[This article was written by Asavin Wattanajantra, who works with the Microsoft Developer Experience (DX) group in the UK. If you have any questions feel free to follow us on Twitter @msdevuk, or view similar content on Microsoft UK Developers].
Since the smartphone era started, the message has been of an app "gold rush’. Anybody with a bit of technical talent and knowhow was able to take advantage of our hunger for new software on our phones, from pick-up and play games like Angry Birds to management apps designed to organize our business and personal lives.
But it looks like that time has passed, and the bigger app development businesses are dominating. According to a study this year by analysts Vision Mobile, 1.6 per cent of developers make more than the other 98.4 per cent combined. And more than that, of the 3m mobile developers in the world, more than half made less than $500 per month.
But smartphone use is growing, right?
The smartphone market would seem to be the definition of a growth industry. Smartphone adoption is growing throughout the world, and the tech firms have optimized their app stores in such a way that it"s easier than ever before to get an app created, built and uploaded to the store.
While this is true, ironically one of the big problems for smaller and mid-market developers is the massive success of app stores. Because there are millions of apps to choose from, it"s actually quite difficult to build a sustainable business, with users generally going for the well-promoted apps that receive backing from powerful companies that have big marketing budgets.
Another problem is a reported decrease in app demand. According to a recent report by Deloitte, almost a third of smartphone users don"t download any apps for their devices in a typical month. It also predicted that the volume of app store sales was reaching a ceiling. However it"s important to note that this doesn’t indicate the app market is shrinking, but rather an increase in the amount of "casual" users.
When and where is the next apps gold rush?
So far so gloomy. But all is not lost for smaller developers who want to build sustainable long-term businesses, though they do need to think carefully about what kind of apps they should be focusing on. And there is one area which could expect explosive growth in the near future: enterprise apps.
The growing use of smartphones and tablets in the enterprise means that more and more companies are adopting mobile technology. The big tech companies are already well aware of this – IBM and Apple recently announced an enterprise app link-up, while Microsoft made a well-received move to put their Office suite on the iOS platform.
And although this wave of adoption is in its early phases, the data show that this is the place to be playing: 16% of developers which target enterprises are twice as likely to be earning $5k per app per month and nearly three times as likely to earn $25k.
What this means for developers
Building an app business is not an easy-fix way to make money. Like in all industries, growing something long-term takes a combination of hard work and inspiration, plus a dollop of good luck. As it should be, it"s very easy to create mobile apps if you have a decent level of tech knowledge, but it’s a significant challenge to make a whole living from an app start-up business. One step to set off on the right path is to focus where the growth is.