Mobile use is a critical success factor for most companies, with corporate apps being deployed to a workforce employing a large number of mobile devices, particularly in those organizations that have adopted a bring-your-own-device (BYOD) approach. But increasingly the management and support of these devices is becoming an unwelcome burden. As a result, organizations are looking for ways to make mobile management a lower-investment priority.
Indeed, many enterprises continue to struggle with mobile unless they make big investments in mobile management and support. By leveraging the infrastructure that an enterprise mobile managed services (EMMS) provider has in place, like scalable device management, provisioning, app delivery, support services and cost management, enabled by the cross-platform expertise they have available to support multiple devices/types, getting rid of the burden of device management, support and provisioning are becoming much more attractive to enterprises of all sizes.
This trend follows along the same path previously followed by data center outsourcing, client/server outsourcing and Web outsourcing. These are all relatively mature technologies that can take advantage of the leveraged resources that outsourcers can bring to bear.
There has been a major consolidation taking place in the stand-alone market for enterprise mobile management over the past two years, and this trend will continue with few "pure play" mobile management vendors remaining. Many of the survivors are looking to branch out into other more lucrative areas, and services is an attractive alternative to just selling software. So which mobile services vendors can move into this higher value market?
Some of the smaller mobile device management/enterprise mobile management vendors are already providing some of the services needed. And clearly the larger mainstream players (e.g., IBM, HP, Dell, VMware, BlackBerry, Citrix) see this as an opportunity. Others will likely enter this market as well in one form or another (e.g., Microsoft, Amazon, Apple, Cisco, Samsung). Many midsize players that started out in related fields (e.g., Tango in the TEM space) also have the resources and business model in place to make this work.
But so far, no companies have made enough impact to take full advantage of this potential growth market. And while many have focused on mid-tier organizations, this is increasingly becoming a large enterprise opportunity where most of the revenues will be generated. Of course, several carriers are already moving in this direction (e.g., AT&T, Verizon), but I expect most of the growth to be outside the carrier channel, although many carrier-vendor partnerships will be formed.
Is this really going to become a substantial market? I expect a dramatic uptake of EMMS over the next two to three years, growing from a market that accounts for less than 5 percent of total mobile software/services revenues today, to 15-25 percent in the next three to four years.
Although many service providers will attempt to move into this space, only those with a firm grip on the challenges that mobile offers will be successful. General outsources do not have the necessary expertise to make their services attractive to enterprises, or to keep the wide variety of corporate end users satisfied. But the continued tightening of resources (both monetary and physical) in most IT organizations, coupled with the need to move investment into more advanced next-generation technologies (e.g., IoT, VR, analytics), will push many companies to move to an outsourced approach. This allows those organizations to defer budgetary considerations to a more attractive operations expense rather than a capital investment model.
I expect some of the more substantial current EMM vendors who are feeling the heat of market consolidation and thinning margins to move into this space (e.g., MobileIron). However, offering services is different than offering products, even though the companies can often leverage their own technology to advantage. It means changing business focus and often personnel. But this transition may be the only viable way for some of these vendors to survive in mobile longer term.
So what’s the bottom line? Over the next one to two years, I expect to see a healthy market emerge for enterprise-grade mobile managed services, beyond the relatively limited services offered today. The market will grow very competitive over the next three to four years, and some providers will not succeed. Enterprises that need to consider such services would do well to be cautious in choosing a supplier. Although obtaining a fixed cost per user per month/year is attractive, finding a company that is stable and around for the long haul might be challenging. But that should not prevent your organization from moving in this direction.
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