I’ve been saying for a while that the so-called mobile market isn’t really about mobility at all, but about touch and better user experiences. And with the advent of Windows 8, whether Microsoft really knocks it out of the park or not, the hybrid desktop/mobile experience is going to redefine enterprise software – not mobile vs. desktop, but mobile/touch as an extension of the desktop, and vice versa.
Backing me up on this is SAP co-CEO Jim Hagemann Snabe, who spoke to me just after his company announced a strong Q4 and fiscal year that emphasized the importance of the growing innovation strategy that SAP has embraced around cloud, mobile, social, HANA, and analytics.
Snabe told me that the fiscal year that SAP just reported also represents the last time SAP will break out separate numbers for its mobile revenue, which I offer as proof that the mobile market is over. The cynics may try to read into this something about the relatively poor track record of SAP’s mobile platform strategy and its accompanying products, particularly as the company’s two platforms come from SAP’s most recent acquisitions, Sybase and Syclo, which were designed to place SAP squarely in the center of the very mobile market I’m now preparing to relegate to the recycle bin of history. But regardless of the state of the mobile platform strategy, I think Snabe is right to stop calling out mobile apps revenue, and here’s why.
Mobile as a standalone market is really a consumer market, and consumer mobile apps are consumed the way most technology is consumed outside the enterprise: as a means to a very specific and targeted functional end. Peruse the Apple Store’s top paid and free apps and you’ll largely see single purpose apps solving a very specific, and limited, need: A game, a funky camera, a YouTube viewer, etc. These apps need nothing more than an iPhone or iPad and an Internet connection to do pretty much everything the customer expects them to do.
The enterprise market initially tried to adopt this micro-process model, and the initial apps were reflective of this. But, as I have said in the afore-cited post, driving the initial design criteria of mobile apps was an artificial distinction Apple placed in the market between consumption (the iPad) and creation (the Mac or PC desktop), mostly as a ploy to sell us two devices instead of just one. But as we have learned over the years, while it made big bucks for Apple, this consumption orientation limited these initial enterprise apps’ usefulness and made a mess out of end-to-end business process software design.
Most enterprise processes are broad enough to need data and process connectivity to the enterprise back office, and increasingly the front-office and cloud-office, and having developers working in one modality for the mobile component and a completely different one for the rest of the application’s process functionality created a break in the encoding of the process, to be blunt, that was stupid and messy.
One of the reasons I like what Microsoft has done with Windows 8 is that it allows enterprise developers to do what Snabe thinks SAP should do: look at all new enterprise applications as end-to-end processors that can have a mobile and a desktop component, and, regardless of which modality is currently in operation, will be designed to be touch-enabled.
That’s because I firmly believe that touch is more important, much more important, than mobile. If your experience with touch is only on a smart phone or tablet, you’re not seeing the full picture. Adding touch to what is effectively a 20th century tool like my PC laptop running Office 2010 is a huge innovation gain for me, even without specific touch-enabled, net-new apps designed to leverage Windows 8. And making touch the key to next generation apps, and not just mobility, allows developers to imagine – and build – a much broader application environment than just building the next cool iPhone app.
Going back to Snabe’s reasoning for no longer reporting mobility as a separate revenue stream, it’s clear to me that if mobile is a capability, and not a means unto itself, then it makes as much sense to count mobile revenue as it does for a car company to count its revenues from anti-lock brakes. Which once upon a time may have made sense, but with anti-lock brakes being standard equipment, there’s nothing special in having them and no reason to call it out.
What makes more sense is to move towards building, selling, and accounting for complete, highly verticalized solutions that may or may not have a mobile component, something that Snabe said is the ultimate goal for SAP. In this world, there is no way to effectively monetize the individual mobile component: if every app has a mobile component, then there’s no way to call out those revenues as a separate revenue stream.
And if every enterprise app has a mobile component, then there is no separate mobile market. The standalone nature of the consumer market means that the mobile consumer market will endure for some time. But, only slightly hyperbolically, the mobile enterprise market as a standalone market is about to die off.
This follows a time-honored tradition of co-opting and subsuming innovation: does anyone sell client/server software anymore? Internet access? Web services? Those markets have come and gone, and now it’s the mobile enterprise market’s time to be subsumed. And soon some other new big market will rise up and then take the dive.
What’s next? Right now I’m torn between announcing the end of the cloud market or the end of the social collaboration market. It’s not a question of whether these two are next – they most assuredly are – but when the ax will fall.
And fall it will: not because they’re unimportant but precisely because of how important they are.