Mobile Efforts Are Starved For Funding

Forrester just released a new report, “The State Of Mobile Technology Adoption.” The report will allow eBusiness professionals to benchmark their annual spending, mobile services, and approach to building mobile services among their peers in North America and Europe.

One of the biggest takeaways from the research is that eBusiness professionals lack the funding they need to build mobile services, integrate mobile services with their back-end infrastructure, and build out teams with the right skills in-house. Consider that:

·         56% of eBusiness professionals spend less than $500K annually on their mobile services.

·         Only 24% spend more than $1M – the base level for a good native application and mobile website.

From a technology standpoint:

·         40% are building applications in-house, with 12% licensing a platform to do so.

·         62% are building mobile websites in-house, with 46% relying on their IT team directly.

·         68% have native applications – far more than are using hybrid applications (most of the budgets would have to be here to fund these efforts).

Spending at these levels gets eBusiness professionals “into mobile,” but it doesn’t allow them to advance the sophistication of their mobile services to enhance a broad set of consumer touchpoints or offer fundamentally new services to support products and customers. Spending at these levels mostly takes existing services developed for a PC experience and migrates them to the mobile phone’s small screen. It doesn’t allow for developing specifically for the unique use cases on mobile phones.

I live in the Bay Area out in California where Walmart.com/Labs signs speaking to big data line the freeway, and one frequently hears radio advertisements from Walmart and Amazon.com seeking mobile developers. The race is ON to acquire talent. Spending in mobile is shifting from front-end services to back-end infrastructure to build web services, get access to real-time data (e.g., inventory, pricing, etc.). Specialist skills are emerging. The required breadth of skills is expanding.

Consider the following acquisitions: They weren’t JUST about mobile talent, technology, and services, but they played a role:

·         eBay (Women’s Wear Daily estimated eBay’s mobile staff at between 400 and 500 developers on April 19, 2012):

o   WHERE ($135M)

o   RedLaser

o   Milo.com ($75M)

o   Zong ($240M)

o   Fig Card

o   Critical Path (smartphone app developers)

·         Walmart builds out its Mobile Labs:

o   Small Society

o   Kosmix

o   OneRiot

o   Grabble

o   Others …

·         Aetna acquires Healthagen.

·         Deloitte acquires Übermind.

·         Amazon:

o   SnapTell

o   Lexcycle

Many eBusiness professionals aren’t stressing about mobile . . . for the most part, they have been able to catch up in a matter of months with a few hundred thousand dollars once they decided to “go.” A few years from now, it will take millions, if not tens of millions, and years to catch up – if they can. 

Comments

Really informative and upto

Really informative and upto the point sir...thank you for ur help

Great Article!

We couldn't agree more. We focus on the backend expertise and find that the experience and skill set is quite specialized and difficult to acquire.

Benchmarks Are Important

Thanks for the heads up on the report Julie. Every communication platform revolution, including mobile, typically has slow adoption rates by businesses so having benchmarks to justify the resource allocation is extremely valuable. We appreciate the insights and I know our customers will too!

Trevor Brooks
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