To set the stage for the Eurapp project, we interviewed a double-handful of representative European app economy participants: third-party developers and providers of platforms and infrastructure. We used insights from these discussions to help design key elements of our analysis, including framing some of the workshop discussion, the market model, the crowdsourcing exercises, and the two larger-scale surveys we have in the works. Our key takeaway: to grow the market, developers need more business than technical help.
We conducted detailed 1:1 interviews with over 15 companies of varying size, including large multinationals like Microsoft, Nokia, and Salesforce.com, as well as specialists like Bash Gaming, Bango, Grapple Mobile, Mblox, Spotify, and SwiftKey. These companies gave us feedback on how their apps business works, and what new opportunities and industry challenges they face in EU markets. These interviews were particularly useful for understanding and gauging the relative importance of barriers or bottlenecks to the growth of the European app aftermarket, and assessing the needs of developers that could be addressed by Eurpean Commission policies and programs.
We examined bottlenecks related to the following:
- Environmental. This includes European environment issues such as the EU’s inherently fragmented market, regulatory conditions, etc.
- Technical. This category covers core technical challenges such as API and data incompatibility, lagging smartphone or 4G network adoption, language translation tools, etc.
- Business and Financial. These include access to capital, revenue model challenges, a relatively small or fragmented advertising market, etc.
- Resources. These are primarily personnel- or talent-related: a lack of developers, difficulty in attracting talent when competing with US salaries, missing business skills at start-ups, etc.
The consensus among the companies interviewed was pretty clear. Most felt developers needed more support in things like business development, marketing, and monetization, than they needed classic technical support like Software Developer Kits, development tools, shareable code modules, and support forums.
We also got an earful on core environmental and business challenges such as market fragmentation, and on app discovery and limited revenue sharing. Several interviewees complained that European privacy and data access regulations added to infrastructure costs and restricted marketing opportunities. And a number of companies cited startup scalability issues caused by limited access to capital in an investment environment that’s more conservative than Silicon Valley.