Technology

Mobile Apps – the end is nearer than you think

By November 6, 2018 No Comments

Mobile apps as we know them today had a good run since 2007 with the release of the first iPhone. The mobile app ecosystem, one of the biggest industries on this planet, turns 11 this year.

What does the data say about the Mobile App?

Current Estimated Mobile App Statistics:

  • The total number of mobile app downloads in 2017 – 197 billion (Source: Statista)
  • The total number of iOS app downloads in 2016 – 25+ billion (Source: App Annie)
  • The total number of Android app downloads in 2015 – 50 billion (Source: Benedict Evans)
  • The total number of Android app downloads in 2016 – 90 billion (Source: App Annie)

Today there is literally an app for everything, from the bizarre to the expected to the true genius. So why do I think the mobile app era is coming to an end? The answer might not be as obvious as you think…

The concept was that, in future, every company would have its own mobile app.

The concept came to me a few years after I worked for a company called HelloCrowd. At the time it was a brilliant idea. You could use the website to create a mobile app specifically for an event with features such as live polling, event streams, maps, speaker profiles etc.

How many Mobile Apps are too many?

We can only handle about 30–100 apps on our phones.

Count the number of apps you have on your phone. If you exclude the manufacturer’s pre-installed apps that you can’t delete, chances are you have at most 100 apps. Those you use frequently probably number less than 30. Too many apps slow down your phone, take up memory space, run background processes, and constantly check for push notifications even when not in use.

In any case, would you really install a few hundred of your friends’ apps or the apps of all your favourite restaurants, events, and companies?

Apps need to do more than just provide information

Since the dawn of smartphones, major companies rushed to make mobile apps. Then they realized it was a real headache to maintain them. Every time you update information on your website or promote a product, you have to do the same on your app. And every time a handset manufacturer updates its operating system, you have to debug your app to make sure it keeps working. There’s also the strain of managing bugs on different brands, models, and screen sizes.

The vast majority of apps make too little money to justify the expense required to create and maintain. They’re not profit centres. They’re loss centres.

The truth is, unless you are a major retailer or content publisher that needs to sell or deliver to customers frequently, all you really need is a mobile-friendly website. If the information is all people want, they’re going to Google it in a browser.

Smaller apps will become part of social media and mobile wallet ecosystems

Given the first two points, this third is a logical evolution and is already happening in some parts of the world. It’s what the industry calls “building an ecosystem.” The strategy involves binding users’ daily behaviours and spending into their mobile apps.

A good example is how restaurants and cafes are integrating into food delivery apps instead of maintaining their own online order and delivery systems. In turn, these food delivery apps are consolidating with the mobile wallet or ride-share apps to provide synergy and convenience to users. Consider Go-Jek, the biggest motorcycle ride-share app in Indonesia. To many people, it’s an all-in-one mobile wallet, ride-hailing, food delivery, and lifestyle services app.

Go-Jek took its inspiration from China’s WeChat, the biggest instant messaging app in that country, which has integrated just about every lifestyle service you can think of into their mobile wallet section. Every serious Chinese business has a WeChat official account, where users can access both static information as well as interactive services and transactions. WeChat has also introduced a “mini-program” section, an API-based ecosystem that basically allows third-party developers to create “child apps” within the main WeChat app so users never have to leave WeChat itself. Third-party developers’ apps connect seamlessly to the payment and social functions of a user’s existing WeChat account.

While WeChat approached integration from the beginning as an instant messaging app, other players in China are attempting to compete from other directions?—?Alipay from its base in e-commerce and Baidu from search engines. The Western world is lagging in this game of becoming a dominant app. It remains to be seen who will become the giant “app of apps” in other countries.

Even successful native apps will consolidate

Any industry consolidates as it matures. This is especially true in the world of native apps, where economies of scale, large user bases, frequent traffic, and so on are required for monetization. No matter how wonderful a new app idea may be, it costs more and more in advertising and promotion before it reaches critical mass to effectively monetize, much less break even.

Apps were called “applications” in the first place because that’s what Apple called locally installed software in their computers to differentiate their system from Windows (which called them programs). Would you install as many different pieces of software on your laptop or PC as you do on your phone?

As far as installing anything on a hard drive goes, think about the trend toward cloud-based services and the software as a service (SaaS) models that are delivered over browsers instead of installing software.

Conclusion

Maintaining a mobile app requires time, effort, and money, especially when operating systems like iOS and Android update frequently. Have you noticed that every time you update the software on your phone, something goes wrong in one of your apps? Native apps are no longer as necessary as they once were. Consolidation is coming, and the era of “there’s an app for that” is coming to a close.

That’s why I predict new mobile apps and updates will see a major decline in 2020 and mostly become an artefact of a bygone era in 2025. With it, we’ll witness the loss of billions in capital that has been invested in the mobile app startup sector.