FierceDeveloper Predictions for 2011

Another year has dawned, and you know what that means: It's time to compile your list of New Year's Resolutions--and if you're a mobile software developer, chances are you've resolved to earn some serious cash in 2011. Read on as FierceDeveloper predicts the events and trends that will shape the year to come in mobile software development--an industry that's anything but predictable. --Jason

2011 Prediction 1. The arrival of the Verizon iPhone vaults developer interest in iOS far ahead of Android. Close to 59 percent of more than 2,300 developers surveyed in mid-September by mobile software platform provider Appcelerator and research firm IDC believe Google's (NASDAQ:GOOG) Android is the operating system to beat over the long haul, compared with 34.9 percent favoring Apple's (NASDAQ:AAPL) iOS. The survey notes that 72 percent of developers feel Android "is best positioned to power a large number and variety of connected devices in the future," as opposed to 25 percent anticipating iOS will dominate. Of course, Android smartphones are available across all four nationwide mobile operators in the U.S., while the iPhone is limited to just one, AT&T Mobility (NYSE:T). But with the apparently inevitable introduction of a Verizon Wireless (NYSE:VZ) iPhone, developer interest in iOS will again explode.

As of the third quarter of 2010, Verizon Wireless served 93.2 million customers nationwide, effectively more than doubling the iPhone's addressable market in the U.S. Pent-up demand for the iPhone is impossible to gauge, but anecdotal evidence suggests it's huge, meaning there's a large segment of the wireless subscriber population champing at the bit to leverage the kinds of applications, services and games enjoyed by AT&T subscribers for several years. And at this point, the iPhone brand sells itself--not to mention that Apple and Verizon Wireless will no doubt pull out all the stops to promote the device's expansion beyond the AT&T network.

In the here and now, 91 percent of developer respondents tell Appcelerator they are "very interested" in creating apps for iPhone, nine percentage points higher than Android--the release of the Verizon iPhone will widen that gap dramatically.

2011 Prediction 2. Android development focus shifts from consumer apps to enterprise tools as Android devices infiltrate the corporate sphere. Google is now activating 300,000 new Android powered devices each day, up from 200,000 in August 2010, and represents 23.5 percent of the U.S. smartphone market according to research firm comScore. As Android's fortunes flourish, Research In Motion's (NASDAQ:RIMM) BlackBerry continues to fade: BlackBerry remains atop the U.S. smartphone market, comScore reports, but its share lead plunged from 39.3 percent in July to 35.8 percent in October. It's a sign of the times that according to data supplied to AllThingsD by ITG Investment Research analyst Matthew Goodman, Android devices represented 80 percent of Verizon Wireless smartphone sales in November--roughly a year ago, BlackBerry devices accounted for over 90 percent of the operator's smartphone sales, ITG notes.

Look for Android to usurp BlackBerry's longstanding enterprise dominance in the months ahead, with a wealth of new devices and applications designed and priced expressly for the corporate environment. In October, Motorola (NYSE:MOT) unveiled the global-ready Droid Pro, promising voice and data coverage spanning over 200 countries as well as full push corporate email, a unified calendar with additional work tools, preloaded Quickoffice Mobile Suite, a 3.1-inch touchscreen and a Qwerty keyboard. Add to that data encryption, remote data wipe and other security enhancements, and Droid Pro offers pretty much everything that enterprise users demand from BlackBerry, bolstered by a superior user experience enhanced by tight integration with Google services and access to the Android Market storefront. ABI Research anticipates worldwide enterprise mobile data revenues will reach $133 billion by 2014--savvy Android developers will jump on that opportunity sooner rather than later, generating a wave of mobile workforce management, fleet management, mobile office and mobile sales force automation tools.

2011 Prediction 3. In-app purchases surpass premium downloads as the leading mobile application revenue model. Consumers have already proven they'll pony up for virtual goods if the proposition is sufficiently compelling--social gaming giant Zynga states that in-application transactions account for 90 percent of revenues derived from its blockbuster FarmVille. In fact, in-app transactions now generate substantially more income for iOS developers than mobile advertisements, according to data published in October by mobile application analytics provider Flurry. Based on a sample study comprising leading iPhone social networking apps and social games reaching an estimated 2.2 million daily active users, in-app sales of virtual goods now account for about 80 percent of developers' average monthly revenue per user--as recently as Sept. 2009, micro-transactions represented only about 15 percent of monthly app ARPU.

That's just the beginning: With RIM committing to support in-app billing across the BlackBerry OS and Android guaranteed to follow, in-app transactions will achieve critical mass in 2011, outstripping even traditional download revenues. Operators are ready to seize the opportunity: In late 2010, AT&T partnered with three different mobile payment solutions providers--BilltoMobile, Boku and Zong--to trial services enabling subscribers to charge digital music, movies and virtual goods purchases directly to their monthly wireless bill. Rival carriers won't be far behind.

2011 Prediction 4. RIM accelerates migration from BlackBerry 6.0 to BlackBerry Tablet OS in last-ditch attempt to galvanize app development. Research In Motion has already confirmed the new BlackBerry Tablet OS powering its PlayBook unit eventually will replace its current BlackBerry smartphone operating system across all devices the company produces. However, RIM has said the transition could take several years, with an updated iteration of the current BlackBerry OS likely to bridge the gap. But with developers steering clear of the BlackBerry platform, RIM will be forced to dramatically accelerate its timetable, with the Tablet OS emerging as the de facto BlackBerry standard by the end of 2011.

The BlackBerry Tablet OS is built upon the QNX Neutrino microkernel architecture and boasts full POSIX compliance, offering developers easy portability of C-based code alongside support for Open GL for 2D and 3D graphics-intensive applications (e.g., gaming). RIM notes the Tablet OS also supports Java, enabling developers to translate existing BlackBerry 6 apps to the PlayBook format, and runs apps built in Adobe Mobile AIR--in addition, the operating system runs apps built on the new BlackBerry WebWorks platform, enabling web developers to create full-featured BlackBerry apps entirely in HTML5, CSS and JavaScript, bringing together existing RIM Web development tools along with new resources and platform services. It may not be enough to revive BlackBerry's fortunes, but it's a start.

2011 Prediction 5. Augmented Reality emerges as the next mobile development hotbed. Limited primarily to local search and reference-based applications, AR will burst into the mainstream in 2011, led by a wave of next-generation mobile games delivering an immersive experience that lays conventional titles to waste. Publishers are already making bets on AR: In November, THQ Wireless introduced Star Wars Arcade: Falcon Gunner for iOS, leveraging the iPhone's camera to overlay enemy fighters on top of the user's natural surroundings--the game also exploits the device's compass or gyroscope to enable 360-degree, full body motion control movement. 

But AR won't stop at gaming: As mobile commerce takes off, AR-enabled retail applications will follow, delivering real-time information, dynamic visualization and other innovations. And look for the second edition of Apple's iPad to incorporate a second camera, further boosting AR's horizons.

FierceDeveloper Predictions for 2011
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