With the rise of BYOD and the increasing power of cloud applications, CIOs are finding that virtually anything that they put out has to have a mobile component. Recognizing this, developers of business applications are focusing innovation on ways that companies can take advantage of end-user connectedness and mobility.
CIOs that have embraced software in the public Cloud will find the transition to mobile a bit easier - and business models less complex - than those looking to extend traditionally licensed, on-premise apps. In the case of cloud, mobile devices provide just another mode of access - increasingly, it is "the" mode of access. Even the most basic monthly subscription plan includes mobile access. In addition, cloud models provide a mode of central provisioning, central administration, and rapid speed of deployment for mobile applications.
Software executives at traditional, on-premise software firms know that their companies must invest in mobile and believe that this investment should be monetized. However, these vendors have not cracked the code to meeting all of the customer expectations for mobile today, priced in such a way that encourages adoption.
CIOs are already realizing that determining what they need in order to extend on-premise applications with mobile applications - and how much it will cost - is not as straightforward as in the cloud. Part of the reason is that additional layers of technology are needed underneath the mobile applications, and customers with on-premise applications must deploy and manage these themselves. At a basic level, this includes the purchase of a middleware or application server layer as well as mobile enterprise management technologies including device management and security. As well, there are services costs associated with integration. One application vendor said that its services to software cost for mobile right now is around 3 to 1. This is primarily due to customers building custom mobile applications, and the vendor expects the ratio to flip once more packaged mobile applications are available.
Then there are the mobile applications themselves. End users have consumeristic expectations for mobile apps - they must be native, easy to deploy and use, and provide a rich experience that includes app awareness and contextual data. In addition, there is a low cost expectation as well as the belief that they should be easy for end users to obtain. This isn't usually the case for mobile apps that extend on-premise software. For example, here's the flow for one enterprise application vendor that IDC spoke with: "The customer determines that they want the app, calls up a channel partner or salesperson, and places an order for the number of users they would like. Then, we process and provision that, and an email is sent to each user with a link to download the app via an appstore. Then, the user can self-service." Some application vendors also charge a provisioning fee for mobile applications.
We are in the early days of mobile business applications adoption. Cloud companies are leading the way with "mobile first" strategies that bring software logic out to where their customers are. Traditional software companies are constrained in their ability to offer customers a clear and simple path to mobility that encourages adoption, but this will need to change. However, customers are demanding mobility and software vendors-regardless of their business model orientation-will need to deliver. As CIOs develop and execute on their mobile application strategies, they should be aware that business models are still in flux. It's a good time to tell your vendors how they should be pricing their mobile apps. Chances are, they would really like to know.