Mobile app dev: Outsource or in-house?

There are good reasons to go either way; just make sure you know what you're getting into.

The Weather Channel, with some of the Web's most popular mobile apps at 90 million downloads and counting, supports some 1,200 different mobile devices -- and does it all in-house.

But it wasn't always that way, and TWC's mobile development strategy has evolved over time, says Cameron Clayton, president of the company's digital group.

An early adopter, The Weather Channel first began developing mobile apps in 2000. Initially lacking the skills to do mobile development in-house, the company turned to outside vendors and continued to outsource the function until 2009.

"We were testing out the mobile environment at first," Clayton says "But we could see how much potential it had."

   Cameron Clayton
"There is a real shortage in the marketplace for people" with mobile app-dev expertise, says Cameron Clayton, president of The Weather Channel's digital group.

Two factors convinced the company to pull development back in-house in 2010. After working with "a multitude of vendors," TWC decided that its "baker's dozen" of mobile apps were too strategically important to leave to others. In addition, after all those years TWC had finally brought some of the development expertise onto its own staff.

The changing approach to mobile applications development at The Weather Channel is not unique. Indeed, it is an evolving journey for many organizations. Some, like TWC, start with outsourcing and then bring mobile development back in-house. Others try to do it themselves, but find they lack the trained resources internally or don't have the time, and must subsequently go outside. Others experiment with both approaches and settle for a combination of the two.

Although IT managers who have gone the in-house route say they feel they have more control and better security, there is a price to pay: Expect to open the purse strings and to spend some time building your team.

Android and iOS application developers can command salaries of $100,000 just a year out of school, Clayton says. "There is a real shortage in the marketplace for people that have these skills."

Keeping the knowledge in-house

Founded in 1967 as the IBM Texas Employees Federal Credit Union, Amplify Federal Credit Union is the seventh largest credit union in Austin, and has total deposits of $479 million. Two years ago Amplify decided that it needed to increase customer services and streamline online banking features.

Eric Clemens had just been hired as director of software development, and "the CEO wanted to make sure we were providing customers with best-in-class services," Clemens explains. That meant going mobile, of course.

"Outsourcing was considered," Clemens says. "But we wanted to make sure we were able to quickly adapt to member needs, and we wanted to keep the knowledge in-house." As a financial institution, Amplify was especially concerned about the risk of allowing an outside firm to tap into sensitive systems.

So Clemens was charged with assembling a new team of application developers, a function that the bank had never done internally before.

"The challenge was trying to find a group of developers that had some banking experience," Clemens says. That experience didn't come cheap.

The bank hired five developers. Two were at a senior level with some banking experience, having come from other financial services companies. They commanded salaries in the $100,000 to $120,000 range, Clemens recalls. The other three were senior developers from other industries, also with salaries near the $100,000 range.

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