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On: 15th February 2012

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The App Bubble

We are in an app bubble. Still. We have been since the launch of the iPhone 3G in 2008. This is something that I hear a lot in my role running an app development agency. Apps are a fad; the .com boom / gold rush of our time. Where will you be when the bubble bursts in a year or two? One day we will all grow up and go back to mobile sites. etc etc etc.

Well, it’s now 2012. We are approaching four years of life in said bubble. So is there any truth in it? I think that the answer is yes. And no. We are in something of bubble, but rather than it bursting what we are seeing is a maturing of peoples approach to it.

The billion doller app

Every app developer wants to invent Angry Birds. Rovio, the company behind it, are now worth over a $1 billion. It was downloaded 6.5million times on Christmas day (2011) alone. That’s a big number. But with over 500,000 different apps now in the apple app store alone (plus the windows and android apps that are out there) for every Angry Birds there are many many thousands of apps that you have never heard of and are rarely downloaded.

Building apps is an expensive business too. Yes, you can find a freelancer to build an app for a couple of thousand pounds but you are taking your chances with what you end up with. I know many freelancers who are very reputable but there are also a large number who are after a quick buck or simply bite off more than they can chew. Building apps is not the same as building websites, as many prospective clients suppose. Software development is a more specialist and more expensive skill. The simplest of apps are going to cost you upwards of £7k. If you add any degree of complexity you need to be considering a budget of upwards of £30k. My point is, you can waste a lot of money seeking the next Angry Birds and chances are you will be one of the many who are either never downloaded or downloaded and used only once.

More smartphones than people

Sounds like a bubble then. We will soon all be wise to this and give up on apps. I think not. The growth in smart device technology take-up shows no sign of slowing down. By the end of 2012 some predictions suggest that there will be more smartphones than people on planet earth! We heard from the Office of National Statistics late last year that 70% of people aged 16-25 access the internet on a smart device while out and about. Current estimates suggest that by 2014 use of a mobile smart device to access online services will over take that of traditional desktop / laptops.

The picture is clear. Our behaviour online is changing because we are, increasingly, accessing services via this new breed of device. When using these devices the best experience in many (not all) circumstances is provided via a native app. And for this reason apps are not going away any time soon.

A maturing market

However, we will see a maturing in the market. The rush to join the app gold rush will give way to a more mature, considered approach. As an organisation you need to have clear goals for your app; both for yourselves and the intended users. Does this app have a purpose, does it meet a need? Do your users want or need an app? And, importantly, are you going to see a return on your investment?

I am going to put myself out there and say that you are not going to invent Angry Birds. However, with careful, considered planning you can develop apps, as part of a wider mobile strategy that will include a mobile optimised website, that are of value to your users and provide a solid return on investment.

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Comments

  1. Nikki
    on February 15, 2012 at 4:06 pm

    This is not so much an app bubble but a saturated market… A bubble would presume publicly held companies that could potentially wreak a bit of havoc on its shareholders.

    A saturated market, on the other hand, just means that too many people are creating too many products – supply exceeds demand.

  2. Rob Borley
    on February 15, 2012 at 4:18 pm

    I see your point. Although, it depends on which way around you look at it. In terms of organisations / individuals looking for developers for their ideas there is a big shortage in supply. Demand is huge. There are no unemployed app developers at the moment.

    Where we are seeing something that could be described as saturation is actually at the consumer end. The people using what is developed.

    Though, again, I don’t think it is as straight forward as to say the market is saturated. There is still a hugh demand from the consumer for apps (just look at some of apples recent download numbers). But there are plenty of apps being developed that simply don’t have a market or are being poorly marketed and so flop.

    If you are going to develop an app you need to think about it carefully. Apps are not the silver bullet that many think they might be.

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