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Analyst Ellison Predicts Widespread Mobile Innovation Fueled by Platform Competition

Jun 25, 2012

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Most of us don’t think about all the decisions that go into making our favorite apps. But for mobile developers, trends and market makeup come into play when developing a new app. 

Mobile is an incredibly dynamic, swift-changing industry. It has opened the door for businesses to innovate and improve a variety of industries from healthcare to automotive and education, just to name a few.

We sat down with Scott Ellison, vice president of Mobile & Connected Platforms at IDC, to separate the hype from reality and to decipher the trends and verticals developers should be paying notice.

"I think the overall pace at which users are adopting mobile apps for a broad range of functionalities and just the sheer pace of innovation coming out of developers continues to amaze everyone. It's one of the brightest spots of mobile,” Ellison said. While larger companies are bringing mobile app development and innovation in house, Ellison points to a phenomenon he calls “crowdsourcing innovation” to describe the near-equal footing new developers have in today’s mobile landscape. “Some of the most innovative things we’re seeing are coming from independent developers,” he adds.

As for which vertical industries have seen the greatest momentum shift, Ellison sees near-term opportunities for mobile developers in retail shopping, healthcare, education and automotive, among others.

“Shopping is a basic human, real world almost daily activity. It’s becoming a real area of innovation,” he said. One particular trend that he’s following in the retail space is the functionality and somewhat disruptive nature of mobile barcodes. Consumers are increasingly scanning barcodes in stores to search for price comparisons, but there are rumblings of a retail backlash in the form of private, proprietary barcodes that would cover the manufacturer’s barcode, for example. Whether this happens or not, it points to an increasingly popular trend and opportunity to put more shopping power in the hands of consumers through mobile innovation.

“Healthcare is another major area of innovation,” Ellison continued. There are numerous health-related services that can be initiated via mobile, but Ellison is especially interested in the data that can be obtained from passive sensors in mobile devices and how it is being integrated into early-detection measures, safety applications and a growing number of new use cases for mobile in personal health.

Automotive is an area of “logistical extension where we expect apps and smartphones to go,” Ellison said. Again, while all of the large auto companies are embracing the mobile opportunity, there is abundant need and opportunity for independent mobile developers to innovate in automotive as well. “The mobile app phenomenon is largely about crowdsourcing innovation. You would expect the automakers to do the same thing,” Ellison said. Apple’s recently announced plans to integrate Siri as an interface for automobile functions is a noteworthy reminder of the kind of innovation mobile can bring to entrenched industries.

“Education, I think is one of the sleeper verticals, if you will,” Ellison said, adding that smartphones and tablets, in particular, are on the verge of becoming as widely adopted as PCs in the classroom.

“Educational entertainment is one of the key drivers of parents allowing their children to use media tablets,” he said. “I’ve never seen technology adopted so rapidly in schools.”

Apple’s iPad has received the stamp of approval from many schools, and that is transferring to parent acceptance in tablets for education in the home. “It seems remarkably engaging to children of all ages. Even with kids as young as six months old, the tablet form factor is incredibly engaging,” he said. “The number of educational apps is just astounding when you look at the Apple App Store."

As for platform innovation and choice, Ellison echoes a sentiment widely held among developers and many players in the mobile industry. “Nobody likes the idea of saying it's just two companies to choose from or two solutions,” he said. "People like to feel they have choice. Competition keeps things fresh and moving forward."

That trend follows a great deal of interest in Microsoft’s Windows Phone operating system, an ecosystem that just surpassed 100,000 apps in the Windows Phone Marketplace, he said. Ellison also discussed Microsoft’s wide-ranging partnership with Nokia, addressing rumors of a potential merger. "Everyone expects Microsoft to at the very least make a major strategic investment in Nokia,” he said. “Nokia, not withstanding all of its challenges, still has a lot of very smart people. We give them high marks at IDC for how fast they were able to turn out Lumia 800 and Lumia 900.”

Still, Ellison sees a merger or deeper integration as incredibly distracting. “Whether Microsoft wants to get full into being a device OEM is still less likely than more likely, if you will."

Business matters aside, when it comes to platform choice and popularity, developers are also increasingly concerned with fragmentation across device types and software upgrades. “It’s not really going away,” Ellison said. “The challenge becomes which ecosystem can limit the fragmentation. Apple gets the gold star for really consciously thinking through how to avoid fragmentation from the start. “A large part of that is due to the cadence of new Apple device releases, Ellison said. Android, however, is a different story." Android is highly fragmented and the challenges are not so much about the different versions of the software … it's really tweaking around the different hardware implementations,” he said."Android may be highly fragmented, but it's also the single largest ecosystem in terms of the sheer number of devices being shipped."

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Matt Kapko