As a long term believer in application marketplaces, it has been rewarding to see the success that offerings like the Apple iTunes store are having. A billion apps makes a convincing argument, and all that.
But I admit to still being absolutely mystified by the absence of marketplaces that incorporate, you know, actual developers. Clearly I’m talking about something distinct from the mobile app stores: if I need a developer to help me configure an application for my iPhone, whoever built it has already failed miserably. For enterprise software, on the other hand, this is the expectation rather than the exception. What’s the last piece of software you rolled out for your business that didn’t require some setup?
Exactly.
And yet while we have perfectly good models for marketplace one-time or recurring payments, buyer and seller ratings, elastic pricing and so on, enterprise software vendors have yet to perceive the massive potential that exists in marketplaces. Instead, they leave the task of finding, vetting and engaging qualified resources to the customer. For some, this is no doubt a shortsighted attempt to protect their own services divisions: by introducing or participating in an efficient marketplace around the after-purchase product experience, vendor service offerings would potentially be at risk. Think what vendors could do, though, simply by facilitating connections between their customers and the developers and third parties that work around these products. eBay for the enterprise undersells the concept, in my view.
Most bizarre is how many of the pieces some of the would-be marketplace providers already have, which are simply waiting on someone who can see the potential.
Consider Microsoft’s Web Platform Installer and Web Application Gallery, for instance. According to a release we were sent this week, the WPI has been downloaded 1.5 million times while users have downloaded 100,000 applications. Setting aside the delta between those numbers, which is admittedly curious, it’s difficult to argue that this initiative has been anything but successful. In spite of the fact that it does little to tackle the last mile of development and implementation: the connection of application users to qualified human resources.
Of the pieces the marketplace I envision would need, an Application Repository, Hardware, Identity Management system, Jobs Marketplace, and a Payment System, Microsoft’s already got one of the hardest to construct: the repository. Azure could be leveraged for the hardware, Geneva for identity, and they have to have some payments infrastructure sitting around somewhere, as long as they’ve been talking about it. Leaving jobs, which they could either build or buy relatively simply, I should think.
Not that Microsoft’s alone in its ability to target this opportunity, of course: there are half a dozen large vendors that could. Even Amazon, not an application vendor, has most of the requisite pieces.
Apple’s iTunes store has demonstrated quite convincingly that when you lower the barriers to application discovery and acquisition, volume is the inevitable result. Which is why it’s surprising that vendors looking to increase their volume sales aren’t doing everything in their power to reduce the friction of the same process with their enterprise wares.
Sooner or later, of course, someone will be the Apple of the enterprise market, and if they get it even half right they’ll be successful. Which in turn will inspire competition, just as iTunes led to the Blackberry Application Marketplace.
We’ll have a battle of the marketplaces, in other words. The only question is when, and who’s going to be first and who’s going to be second.
Who knows? Maybe it’ll be Sun.
Disclosure: Microsoft and Sun are RedMonk customers, while Amazon and Apple are not.
