App Stores (if Apple permits the term) or Open Source?

It’s been an interesting week for headlines. First and the most controversial is George Cooney, the head of Forrester Research, publicly stating that Apple revenues will overtake IBM and HP as it moves into being a $200 billion company. (IBM is at $99 billion and HP at $126 billion currently). What George didn’t comment on was the Apple business model that drives not only these revenues but a very high profitability model, but then that’s the point of this post. Apple doesn’t just sell the hardware, or even conventional software, the Apple App Store brings a whole new dimension to where, and how, we obtain ‘services’ and pay for them.

With that point in mind, Forrester also produced a report commenting on the confusion in the IaaS (Infrastructure as a Service) market. In the report summary posted on its website, Forrester drew attention to the difference between the 6% of CIOs using IaaS against 16% of business managers. I have not seen the full report but I hope the analyst house asked what both groups are using IaaS for. I suspect CIOs are more likely to be doing testing using external virtual machines and business managers are building, or consuming, actual business apps. Forrester Principle Analyst Frank Gillett points out the obvious risk of enterprise data being moved outside, and comments on the related security issues.

The second headline that I want to link with this followed RedHat publishing a 25% rise in Q4  revenue leading to headlines that it was expecting to become the first $1 billion Open Source company. Hidden in the text was the comment that this was due to strong growth in data centre and cloud market places. Maybe now the linkage and the headline become clearer? The other point in the title and another headline this last week, is that Apple is suing Amazon over its use of the term App Store claiming it as an Apple term. Given the number of companies that have announced that they will be launching App Stores, the lawyers are going to be busy.

It’s clear that we are shifting to an externally focussed and shared environment in which we all meet to do business, and that means using the internet for connectivity, the web for content and the cloud for processes delivered and orchestrated from ‘services’. All of which means a technology shift towards loose coupled orchestrated services, away from internal enterprise applications, and therefore a shift to Open Source licenses, as traditional licenses based on defined numbers of processors and users simply don’t work. So here is the explanation for a whole year of 20% plus per quarter growth by RedHat, and I suspect other Open Source players.

But how open do we want the things that our business colleagues use to be? It was fascinating to see Apple, who has previously collected abuse for its closed app shop business model, standing up forcefully at the recent RSA Conference to argue that their closed ecosystem is a safe approach, and indeed they are right. As Apple controls the developers and the resulting apps are tested for safe conformance a user should be able to load an Apple App from its App Store in complete safety. The real question is not about the closed environment; technically it’s actually about the commercial cost of the model with complaints that Apple currently wants too big a share of developers’ money for the benefit of participation in this closed market place.

HP is the latest company to announce its conversation to developing an App Store concept which I guess will be an extension of its current Download store into a much enlarged enterprise as well as consumer store. Presumably this, coupled with its shift to being a provider of smartphones, tablets and PCs, will change its business model towards one more like the Apple model, and maybe that could stop Apple overtaking in revenues as George Cooney predicts. The real question in all of this is where we source the software we want to use, will there be enough choice, how expensive will a closed community model be and is this a price worth paying for ‘safe’ end user computing?

Open Source software is one route, but app shops are another and newer model to consider. We also need to contemplate that we can already see four players offering end users a combination of different devices each with its own operating system for user / device integration which presumably will also tie them to some form of app shop. Who are the four? Apple with iOS, HP with WebOS, Google with Android, and Microsoft with Windows and there is no significance in this order!

Related Posts


People: the backbone of every innovation lab

Henk Vermeulen
July 20, 2018
We are building demonstrators of how these technologies have a practical application in a diverse array of business processes in weekly sprints.

On the ground with Agile

Singhania, Sunil
July 18, 2018
At Capgemini, we can meaningfully offer to start Agile onshore, then graduate to nearshore and offshore as clients’ confidence in the process grows.
change management

Digital culture – (en)rich companies and employees

Yvette Zzauer
July 18, 2018
How can companies transform themselves into a digital enterprise? Our study results and experience show that a transformation with an iterative change management approach is a crucial success factor.

By continuing to navigate on this website, you accept the use of cookies.

For more information and to change the setting of cookies on your computer, please read our Privacy Policy.


Close cookie information