With Apps Stores and Online Marketplaces Proliferating, The Business Model of Software Development is Transforming Before our Eyes.
When I started as an engineer, the waterfall model dominated software engineering. We would focus step-by-step on gathering customer requirements, designing an architecture, and assigning tasks to engineers. This process allowed us to create entire systems from scratch. It also took a lot of time.
The world has changed, and competitive pressure means we no longer have that luxury. Fortunately, we can stand on the shoulders of fellow engineers, relying on pre-existing frameworks, platforms, and services. At the application level, we can use rich APIs provided by operating systems or web browsers. Online services provide infrastructure, databases, and full application management tools.
These components allow us to quickly create sophisticated systems that are rich in features. We reuse modules that provide standard functionality, allowing us to focus our limited engineering resources on the unique, differentiating aspects of our business.
When you’re embedded in a team that’s producing a software package on a budget, the efficiency this creates more than justifies the time it takes to learn a new framework. However, if you’re a small shop or solo entrepreneur, there is something else that is critical: accessing the market.
This points to the strength of a market-based platform that provides both the technical tools and the sales channel. Market access creates both the customers and the facilities to handle payments and subscriptions.
This rides the macro trend of the gig economy and entrepreneurship. Individual developers can go into business for themselves, creating apps that have the potential to go big without investing much more than time. Consider Dong Nguyen, whose Flappy Birds app went viral and resulted in over 50 million downloads and revenues that peaked at over $50,000 per day.
Developers have many options in terms of technology platforms. Today’s it’s incredibly difficult to create successful apps on existing markets due to the level of existing content and competition. Android’s app store includes about three million apps. Apple’s app store has around 2.5 million. And the numbers continue to increase.
For software developers and development firms that want to get in on the ground floor, they should keep an eye out for emerging software platforms that include marketplaces. Engaging early with these companies can help create a presence from the start, establishing a brand and critical mass with users of the platform early. Smaller companies like Envato, for example, have created platforms where third party developers can build and provide their tools to their broad customer base.
To help determine the best platform to develop for, ask yourself these questions:
- What is the subject and content that you care most about? Games, social, or business?
- What companies are creating marketplaces to support their platforms? Which of these have the most compelling vision of the future?
- What companies with marketplaces have the easiest development tools and processes?
- What is the business model for developers? Will the model allow for win-win long-term collaboration?
Developing apps and widgets can be a big commitment but can also result in big rewards. Finding the right platform partner helps ensure software developers get the support they need and can generate revenue that supports and grows their own business.
This is exactly what we’re doing at Praxie. We’re creating a marketplace where developers can create apps & widgets that transform any business process. Check it out.
As co-founder and Chief Technology Officer of Praxie, Michael Rothrock is a seasoned technology executive and entrepreneur with vast experience spanning both large enterprises and successful start-ups. With two decades of experience in large scale collaboration, mobility, and mission critical systems, Michael formerly served as Chief Platform Officer at MaxPlay. VP of Product and Services at ionGrid, building the company and leading it to a successful sale to NetApp. Earlier in his career, Michael held a series of positions with increasing responsibility at Interwise (acquired by AT&T), Orative (acquired by Cisco), and Portal Software (IPO).
