Developer economics state of the developer nation q3 2016

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Developer Economics | State of the Developer Nation Q3 2016 | © VisionMobile | All rights reserved | https://www.DeveloperEconomics.com/go 1

Contents

Key Insights

1. Mobile platform wars: Round 2

2. Desktop and cloud developer tribes

3. A new phase in the IoT market

4. Where are developers looking next?

Methodology

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ABOUT THE AUTHORS

Mark Wilcox Senior Business Analyst

Stijn Schuermans Senior Business Analyst

Christina Voskoglou Director of Research and Operations

Mark has over 13 years of experience in mobile software across a variety of roles, however. He received his first computer at 4 years of age and wrote his first program at 7. He will probably always be a developer at heart. A growing interest in economics and business models has led him to work with VisionMobile as a Business Analyst, whilst still keeping his development skills up to date on development projects. You can reach Mark at: [email protected] @__MarkW

Stijn has been the lead Internet of Things researcher in the VisionMobile team since 2012. He has authored over 20 reports and research notes on mobile and the Internet of Things. He focuses on understanding how technology becomes value-creating innovation, how business models affect market dynamics, and the consequences of this for corporate strategy.

Stijn has a Master's degree in engineering and an MBA. He has over 10 years’ experience as an engineer, product manager, strategist and business analyst.

You can reach Stijn at: [email protected] @stijnschuermans

Christina leads the analyst team and oversees all VisionMobile research and data projects (big or small!), from design to methodology, to analysis and insights generation. She is also behind VisionMobile’s outcome-based developer segmentation model, as well as the Developer Economics reports and DataBoard subscription services. While at VisionMobile, Christina has led data analysis, survey design and methodology for the ongoing Developer Economics research program, as well as several other primary research projects.

You can reach Christina at: [email protected] @ChristinaVoskog


About Developer Economics ......................................................... 4

Key Insights .................................................................................. 6

Mobile platform wars: Round 2 ..................................................... 7

Android begins to dominate ....................................................... 7

iOS is down but far from out ...................................................... 8

The mobile browser comeback continues ................................... 8

The Windows 10 plan seems to be working ................................ 9

The final four .......................................................................... 11

Desktop and cloud developer tribes .............................................. 12

Desktop platforms as the basis for developer tribes .................... 12

The diversity of web tribes ....................................................... 12

The shepherding of the Windows tribe ..................................... 13

The Unix tribes are still anti-Microsoft ..................................... 14

Why should we care? ............................................................... 16

A new phase in the IoT market .................................................... 17

Smart Home: the undisputed king of IoT verticals .................... 19

What’s next? ............................................................................ 19

Where are developers looking next? .............................................. 21

The battle for the next interface ............................................... 21

Making sense of data ............................................................... 22

Skills for the future .................................................................. 23

Methodology ............................................................................... 26

TABLE OF CONTENTS


About Developer Economics Welcome to the State of the Developer Nation Q3 2016 report, based on the 11th Developer Economics global survey wave. Produced by VisionMobile, Developer Economics is the leading research program on mobile, desktop, IoT, and cloud developers, tracking the developer experience across platforms, revenues, apps, languages, tools, APIs, segments and regions. In this latest survey we also added two emerging areas of developer activity – augmented and virtual reality, and machine learning and data science. The 11th Developer Economics global survey wave ran in April and May 2016 and reached more than 16,500 developers in over 150 countries. This research report delves into the key developer trends for 2016 and discusses mobile platforms, desktop platforms, server side languages, IoT markets, and the adoption of emerging technologies.

The report focuses on four major themes – each with its own visualization, showing how the data lends insight into the developer community.

1. Mobile platform wars: Round 2 – the mobile developer population is shifting east and to Android. After years of stability, Android is now extending its dominance in device sales to even greater developer mindshare and priority over iOS.

2. Desktop and cloud developer tribes – there are strong correlations between desktop developer platform priorities and their choice of language on the server side. These illustrate how the developer population is split into technological tribes.

3. A new phase in the IoT market – the massive influx of developers to IoT in 2015 has slowed significantly, and developers are picking which vertical markets to target. Where are bets going to be placed as the market begins to mature?

4. Where are developers looking next? Augmented and virtual

reality, and machine learning – are they just the latest over-hyped technologies or the next big things? The level of developer interest in both areas suggests the latter.

We hope you’ll enjoy this report and find the insights useful! If you have any questions or comments, or are looking for additional data, you can get in touch with Matos Kapetanakis, Senior Manager for the Developer Economics Program, at [email protected].

You can download this free report at https://www.DeveloperEconomics.com/go

Mark, Stijn, Bill, Christina, Christos, Matos, Alex, Eitan, Andreas, Emilia, Dimitris, Kosmas, Vanessa, Sarah, Michael, Nick, Andrea and Chris at VisionMobile.

Thank you We’d like to thank everyone who helped us reach 16,500+ respondents for our survey, and create this report. Our Research Partners – Intel and Microsoft. Our Leading Community and Media Partners, who are too many to number here – you know who you are! Also, a special thanks to our partner community Agile Turkey – Software Craftmanship Turkey, who were especially supportive throughout the survey.


• Leaping to a new record for any platform since we started measuring, Android now has 79% mindshare amongst mobile developers.

• 47% of professional developers now consider Android their primary platform, up 7 percentage points in the last 6 months.

• The number of professionals who consider iOS their primary platform fell 8 percentage points from 39% just six months ago to 31%.

• Microsoft is clearly having some success shepherding Windows classic developers towards newer technologies; an impressive 36% primarily use C# on the server.

• Developers that primarily target Linux or macOS on the desktop are extremely unlikely to use C# on the server. Just 2% of Linux-first developers and 3% of those that prefer macOS are primarily using C# for their backend.

• The wave of IoT newcomers is coming to an end. Throughout 2015 roughly half of the IoT developer population were newbies – 57% in our Q2 2015 survey, and 47% in Q4 2015 had less than an a year of experience, that proportion dropped to 22% in Q2 2016.

• Smart Home is not just the biggest IoT vertical in terms of developer interest, with 48% targeting it, but also the fastest growing – up 6 percentage points in the last year.

• Nearly 23% of developers are already involved in either AR or VR development, most of those as a hobby or side project.

• An amazing 41% of developers are involved in data science or machine learning in some way, 33% of those in a professional capacity.

KEY INSIGHTS


Android’s mindshare has been fluctuating within a very narrow, 70-73%, range even as the mobile developer population has grown enormously. Similarly iOS mindshare hasn’t been out of a 51-55% range since 2013. The mobile browser went out of favour quite dramatically, but regained mindshare quickly as developers realised that they now needed a mobile site and an app. Microsoft’s Windows Phone very slowly gained mindshare and then gave back the gains as the platform failed to take off with consumers. When it comes to developer priorities, iOS and Android have been roughly neck and neck globally, particularly amongst professional developers. There

was a strong bias towards Android in the East and slight bias towards iOS in the West, with many more developers being based in the West. It seemed that with the phenomenal number of Android devices shipping globally developers favouring other platforms would not be able to justify their preferences forever, yet the status quo remained. However, with the data from our 11th Developer

Economics survey we can see that the stalemate has been broken and the second round of the platform wars is now underway.

Android begins to dominate Leaping to a new record for any platform since we started measuring, Android now has 79% mindshare amongst mobile developers. While Android has been ahead of iOS for almost as long as it has existed, that lead has primarily been driven by greater adoption amongst hobbyists and those building apps as a sideline. Now we see 80% of those building apps professionally target Android. This is also reflected in the priorities of professional developers, with Android up 7 percentage points in the last six months, 47% of developers now consider it their primary platform. Amongst hobbyists, and those exploring mobile development on the side, that figure rises to 52%. If we look across different regions Android still trails iOS by a single percentage point when it comes to the priority of professional developers in North America, and the two platforms are level in Western Europe, but in every other region Android has a clear lead, and in many developing regions (South Asia, South America, and the Middle East & Africa) is more than 20 percentage points ahead. The nature of apps mobile developers build has been shifting away from

1 MOBILE PLATFORM WARS: ROUND 2

Our Developer Economics surveys have tracked mobile platforms since 2010. After an initial war, in which Android and iOS defeated all competing platforms to form an effective duopoly, the high-level picture has been stable for more than 2 years.

Leaping to a new record for any platform since we started measuring, Android now has 79% mindshare amongst mobile developers.


direct monetisation via paid downloads, advertising, or in-app purchases, and towards mobile apps as enablers for other businesses. With Android’s massive advantage in device sales market share, which all major analysts are now claiming to be above 80%, it’s going to be increasingly difficult for developers to justify not supporting Android.

iOS is down but far from out Android’s success doesn’t mean that iOS is doomed. It seems clear that Apple have anticipated this scenario and have been taking steps to manage it. Apple still owns the high-end of the device market and consequently the most valuable customers. As such they have not lost significant mindshare yet and probably won’t for some time. Mindshare for iOS was down to 52% from just over 54% in the last six months, however that leaves it within the same range it has occupied for more than 2 years. More importantly iOS mindshare amongst professional developers remains a very healthy 61% globally. It is the drop in these professionals prioritising iOS that should be of much more concern: the number of professionals who consider iOS their primary platform fell 8 percentage points from 39% just six months ago to 31% in our most recent survey. Part of Apple’s dominance of the high-end market has been their status as the platform for early adopters. iOS has been the platform that has all the new and cool apps first and usually has the best versions of those apps. If that advantage shifts to Android then it could start to hit device sales, which in turn would eventually lead to a downward spiral in developer interest.

Apple has two key problems: the first is that the high-end of the market is growing slower than the total market, so their market share is gradually shrinking; the second is that there’s a shortage of talent familiar with Apple’s platforms to fill professional roles. There are less than half as many hobbyists targeting iOS as Android and less than a third as many who prioritise iOS. To begin to tackle the first problem Apple took its first real (but small) step further downmarket

with the iPhone SE. The solution to the second problem is centered around Swift; Apple’s new language and, according to StackOverflow, developer’s most loved. In East Asia, where Apple has a big focus on China as potentially its largest market for the future, we can see that efforts to court developers have been having some success. The percentage of professional developer prioritising iOS (17%) is moving ahead of local device market share. In South Asia, where iOS is weakest in terms of developer preference, Apple recently announced that they would launch an iOS App Design and Development Accelerator in Bangalore, India. It’s clear that in the second round of the platform wars, Apple is going to have to work much harder for developer hearts and minds than when they’d just redefined the smartphone market the first time around.

The mobile browser comeback continues In Q3 of 2014, the mobile browser hit an all-time low of just 15% mindshare amongst mobile developers, with only 7% of professionals considering it their primary platform. It has been bouncing back ever since. Whilst still far away from the dizzy heights of 56% mindshare that it enjoyed in 2011 the browser as a mobile platform has now regained a very respectable 30% mindshare, although only 11% of professionals prioritise it. This is the new place for the browser in the mobile world. For many it is increasingly essential, if additional, platform. It’s becoming clear that not everyone wants to download a native app for everything they do online. A fantastic example of this is the biggest part of the mobile app economy: e-commerce. Online retailers were seeing their best customers using native apps, and tried to push as many as possible to install their app rather than use their websites. Flipkart are the leading example here, having planned to

The number of professionals who consider iOS their primary platform fell 8 percentage points from 39% just six months ago to 31% in our most recent survey.


move completely away from the web to native app only. It turned out that this trend was driven by correlation and not causation. Very regular and satisfied customers were willing to download a native app for a better experience. More occasional customers, and particularly new customers, would much rather use a mobile website. Flipkart’s native-app-only plan was abandoned towards the end of 2015, and hopefully the rest of the industry has learned from their mistake. We expect the mobile browser’s comeback to continue for at least the next few years.

The Windows 10 plan seems to be working Microsoft has been struggling to break into the mobile market ever since it was slow to react to the iPhone. Despite buying Nokia’s devices unit and pumping enormous amounts of money into marketing, sales traction never materialised. Surface tablets with ARM processors (branded “Surface RT”) didn’t sell either. Microsoft’s hope of building a profitable niche around their Continuum concept; smartphones that turn into a full PC when docked with a keyboard, mouse, and monitor, may have been dealt a blow when Intel decided to pull out of smartphone processors this year. The docked phone is going to be missing essential enterprise apps, just as the ARM-based tablets were. However, Windows tablets with Intel processors are looking like winners, in particular hybrid

devices, that are both a tablet and a laptop, are successfully blurring the line between desktop and mobile development. Developers of desktop apps for Windows are now incentivised to create mobile optimised UI’s too. This has pushed Windows 8/10 into third place in platform mindshare, with 34% of developers targeting it. Enterprises using existing, native, Windows apps that are looking to take advantage of tablets may have significantly less development effort if they stick with Windows. If they really want to support iOS or Android then Microsoft can offer them Xamarin, so they don’t have to migrate their code away from .NET.

Windows Phone, which is still selling even if new devices will all be Windows 10 Mobile, has remained stable at 27% mindshare although the percentage of professional developers prioritising it has fallen to 4%. This loyalty from developers may seem surprising in the face of plummeting market share as Microsoft scales back their smartphone efforts. Windows on the desktop owes much of its success to OEMs creating their own hardware in which to run the Microsoft platform, but despite drops in pricing and other incentives OEMs have failed to fill the gap. We saw similar temporary loyalty from BlackBerry developers in the past, as their customers disappeared too. In this case we won’t get to see the true drop in Windows Phone developers when it comes as they’ll be largely absorbed into the Windows 10 developer pool.


The final four As Windows Phone eventually disappears, being fully replaced by Windows 10, we’ll be down to just 4 important platforms in the mobile market. The many other platforms out there combined have just 20% mindshare total, and the vast majority of that is Android variants like Amazon Fire OS, CyanogenMod, and MIUI. These other platforms, between them, are prioritised by less than 1% of professional developers. Given the scale of the ecosystems that exist around the top platforms it’s almost impossible for a new platform to emerge. Android variants can continue in successful niches as long as they don’t stray too far from compatibility with Google’s version. However, without some major shift in UI paradigm transforming the market, these are the only platforms that matter for the foreseeable future. We’ll keep watching and reporting on the battle between Android and iOS at the top, along with Windows and the mobile

browser’s attempts to win greater mindshare. The really interesting action in the mobile market will be on a different level. The centre of the mobile development universe is moving east. North America is heavily populated with hobby and side-project developers and there are already more professionals in Western Europe, but several other regions are catching up fast. How will the makeup of the mobile developer population change in terms of their goals, tools and revenue models? Will messaging apps successfully build platforms on top of mobile operating systems? Will augmented and virtual reality, driven by mobile devices, be the big new computing paradigms? If so, who will dominate those? Will future success in the mobile platform and app markets be driven by capability in machine learning? Our premium research subscriptions will keep you up to date with the latest data and insights for all of these questions and more.


These developer tribes can then differ significantly in terms of the tools they use, both technically and for communication, and where they go to find information. We can see evidence of these tribes if we look at developers working across both desktop and cloud, and the correlations between their desktop platform preferences and their server side language choice. In theory, server side language choice is independent of desktop platform. Of course there are advantages to standardising on a particular technology and at least someone in each organisation has to have a high level of understanding of how everything works. Even so, the best tool for the job will not always be the one a development team already knows. This tribal behaviour, and tendency to stick within a particular technology ecosystem, is the basis for many developer segmentation models. However, as we’ll see, these tribal affiliations are neither permanent nor strongly predictive of future choices when compared with other factors.

Desktop platforms as the basis for developer tribes Microsoft clearly won the battle for desktop operating systems, and a big part of that victory was winning over developers. Independent

software vendors built large and successful businesses on top of Microsoft’s platform and most companies built their internal systems on it too. Microsoft’s monopoly has multiple opponents. Developers, originally motivated to preserve the freedom they had in early Unix days, fought against proprietary operating systems. They eventually found a viable cause to champion in Linux, although it’s a cause that’s significantly more popular amongst developers than end users. Developers who chose and stuck with Apple’s Mac were a very small tribe with a small but viable niche audience. They’ve experienced a resurgence in recent history thanks to Apple’s success in mobile computing. However, by far the biggest opponents of the native Windows world are web developers. Championing an open standards-based browser as their runtime, web developers can reach users on any operating system, avoiding control by any one company.

The diversity of web tribes Although the web browser forces the use of HTML, CSS and JavaScript on the front-end, the choice of server side language is then fairly free. Despite the availability of JavaScript on the backend via

2 DESKTOP AND CLOUD DEVELOPER TRIBES

Developers can be quite a tribal bunch. They often band together around particular technology clusters, engaging in endless ideological or technical debates with those that choose other technologies about which is ‘best’. A lot of developers, although far from all, can end up living within particular technology ecosystems, and learning new technologies from within those to solve new problems.


Node.js, this is only the first choice for 15% of web developers. Web developers are more likely to prefer JavaScript on the server than those using any other desktop platform, but not by much. The most popular language for backend development amongst the web developers is perhaps the most divisive: PHP is preferred on the server by 24% of those prioritising the web browser on the desktop. Yet a simple search will find endless rants going back more than a decade about how terribly designed PHP is as a language. Most PHP developers are pragmatists and will claim that it’s easy to learn, great for building simple things quickly and trivial to deploy almost anywhere. Interestingly, there’s a larger than average tribe of server-side Java fans (20%) amongst the web developer crowd, whilst the fairly similar C/C++ is strongly avoided (2%). Perhaps using a very dynamic and flexible language like JavaScript biases developers away from having to manage memory manually. At the same time, Microsoft has also managed to hold onto a decent fraction of developers that have opted for the advantages of web deployment. 18% of those whose primary desktop platform is the web browser are using C# on the server.

The shepherding of the Windows tribe Microsoft’s unbeatable advantage on the desktop was built around the Win32 API. Despite years of modernising and pushing newer alternatives built around C# and .NET, there are still millions of applications out there built for the older API in C/C++. This is

currently the largest group of native Windows developers and a surprisingly large 13% of them still prefer C/C++ on the server too. However, Microsoft is clearly having some success shepherding them towards newer technologies, since an impressive 36% primarily use C# on the server. Amongst the Microsoft-technology-focused developers that have embraced modern Windows apps on the desktop, that percentage grows to a massive 41% prioritising C# on the server (and C/C++ fans fall to 6%). Almost 17% of all Windows developers prefer PHP on the server, with nearly another 15% preferring Java. These proportions are consistent across classic and modern native Windows app developers, with the same being the case for Ruby, Python, and visual development tools. The key area of difference between the two outside of C# and C/C++ is that the more traditional classic Windows app developers are still skeptical of JavaScript on the server, with only 5% prioritising it, while the modern Windows developer embraces it at a similar level (12%) to users of other desktop platforms. While they clearly have a strong core audience for Azure using C# and .NET, Microsoft also need to successfully embrace the diversity of server side languages in their desktop base in order to expand beyond it with their cloud efforts.

Amongst the Microsoft-technology-focused developers that have embraced modern Windows apps on the desktop, that percentage grows to a massive 41% prioritising C# on the server.


The Unix tribes are still anti-Microsoft It seems that old habits die hard. Under the leadership of Satya Nadella, Microsoft has transformed their approach to other platforms and open sourced a significant number of their development language and tooling code bases. Even so, developers that primarily target Linux or macOS on the desktop are extremely unlikely to use C# on the server. Just 2% of Linux-first developers and 3% of those that prefer macOS are primarily using C# for their backend. The

Linux tribe really like C/C++ on the backend (22% prioritising) while the macOS tribe do not (just 6% prefer it). Somewhat surprisingly, those that primarily target macOS are the most likely to prefer PHP on the server side (26% do so), while the Linux desktop developers are the least likely to do the same (just 13% prefer PHP). This is despite the fact that Linux is at the core of the once ubiquitous LAMP stack (Linux, Apache, MySQL and PHP). Both tribes are happy with Java, the Linux developers slightly more so (24% and 18% respectively), and both have about average preferences for JavaScript. As for the other dynamic languages, both tribes show an above average fondness for Python, but only those that prioritise macOS seem to significantly favour Ruby on the backend.

Just 2% of Linux-first developers and 3% of those that prefer macOS are primarily using C# for their backend.


Why should we care? Within tribes, developers adopt more habits than just which technologies to use. Generalising slightly, the web developer community tend to open source almost everything on GitHub, ask and answer questions on StackOverflow, and network with their peers on Twitter. Microsoft’s developer community has tended not to open source much in comparison, when they do it has a decent chance of being on CodePlex instead. They’re active on StackOverflow, but also use Microsoft’s forums and other smaller communities extensively. If you try to reach out to them on Twitter you’ll only see the tip of the iceberg.

For developers this means cross-fertilisation of ideas between communities is not happening as much as it could. In many ways C# is a better Java and is evolving faster, yet it’s rejected by many. Going the other way, there are simply not the open source solutions for distributed computing that C# developers need to build scalable cloud services, which the Java ecosystem has in abundance. The Reactive Extensions that Microsoft pioneered in C# are certainly spreading across languages and growing in popularity, but there is resistance to standardising on TypeScript amongst those that want static type-checking in JavaScript. Meanwhile the Apple tribe now

has Swift, which is well-loved and extremely promising, but it remains to be seen how it will influence other languages rather than just become a silo.

The other side of this is that developer marketers have a critical need to understand their target markets in detail. We’ll be publishing an in-depth report on where developers go to find information later in the year. However, while these technology driven splits in the developer population are important, they are mostly useful as a secondary tool for understanding future developer choices. When mobile platforms came along, a lot of the Microsoft developer tribe decided to explore mobile apps with Windows Phone. Then, when they wanted to start making some serious money, or make mobile their new career, they switched platforms to iOS or Android, depending on their goals. Indeed it is goals that are the causal driver of developer choices. At VisionMobile this has been at the core of our segmentation model from the beginning and we have segmentation reports available for Desktop, Cloud, Mobile and IoT developers using this approach. Understanding what technology tribes developers live in can help to fine-tune product positioning and marketing communications for a specific segment.


This marks a new phase of the IoT market. One sign of this can be found in the vertical markets that IoT developers focus on.

When developers first join the Internet of Things space many of them start by playing around with IoT technology without committing to any specific vertical market (although they might have some in mind that they plan to enter in the future). Just think about the large communities that are playfully experimenting with Arduinos or Raspberry Pis and you understand what this group is about. Overwhelmingly, these developers self-identify as Hobbyists, who are in it purely for the fun, or Explorers trying to create career opportunities – 86% of non-committed developers are found in these two developer segments. At the start of 2015, 24% of IoT developers

didn’t target any vertical... yet.

As we discussed extensively in our June 2016 IoT Developer Segmentation report, the percentage of developers without a target vertical falls quickly with experience; after two or three years in the field only a small number of developers remain non-committed. Combined with the end of the large-scale inflow of new IoT developers, this results in a big drop of non-committed developers: from 24% to 18% in one year’s time. We’re starting to get a large pool of fairly experienced IoT developers who know what they’re after; a more mature, more focused, IoT community.

And what’s the first vertical that many IoT developers pick? Smart Home.

3 A NEW PHASE IN THE IOT MARKET

2015 saw a massive inflow of developers joining the Internet of Things market. Throughout that year roughly half of the IoT developer population were newbies; active for less than a year in the field (57% in our Q2 2015 survey, 47% in Q4 2015). That wave of newcomers is now coming to an end. The proportion of IoT developers with less than a year of experience dropped to 22% in Q2 2016; 54% of IoT developers now have one or two years’ experience in IoT.


Smart Home: the undisputed king of IoT verticals Almost half (48%) of the IoT developer population now targets the Smart Home. The next most popular vertical is Wearables, at 29% a distant second. Smart Home is not just the biggest vertical in terms of developer interest, but also the fastest growing – up from 42% a year earlier.

It’s fairly easy to imagine a potentially valuable Smart Home solution, and technology-wise Smart Home is not the most challenging vertical to build a prototype for, given the popularity of Raspberry Pi computers and open source Smart Home platforms. This makes the vertical very popular among inexperienced IoT developers. Smart Home has the highest proportion of all verticals of developers with two years experience or less (78%). It also has the highest proportion of Hobbyists and Explorers, at 70% combined.

Developers don’t create Smart Home solutions just because it’s easy, however, they also see this as a time of opportunity – the right time to enter this market. The Smart Home market is slowly starting to consolidate. In 2015 and 2016 we’ve seen several high-profile acquisitions in this space (ADT, iControl), several major failures of early entrants (Nest ending support for the Revolv hub, layoffs at Sonos), and Smart Home standards merging (the Open Interconnect Consortium acquiring UPnP, and subsequently merging with IoTivity). At the same time we see major platform players coming to the fore. Amazon leads the pack with Dash buttons and especially with the developer-friendly Alexa assistant (embodied in the Echo, Dot, and Tap devices). There is speculation that over 3 million Echos have been sold, and developers have created over 1,000 Alexa Skills (services) so far. Google is cleaning house in its Smart Home efforts, leading to the departure of Nest founder Tony Fadell, and

has recently launched Google Home, a direct competitor to Amazon’s Echo. Apple inches forward with HomeKit and has launched a new Home app at WWDC.

Overall, fragmentation seems to be reducing, and it feels like a good time to execute on a fast-follower strategy, learning from your predecessors’ mistakes. It’s also becoming clear that artificial intelligence will be a major component of the Smart Home user interface, and in that sense the Smart Home market is riding the hype wave that AI is currently experiencing.

This said, the Smart Home – both as a developer pool and as a market – is still immature. The killer apps for Smart Home systems are not yet clear, and the market is still dominated by point solutions like connected lightbulbs and, more recently, DIY security systems. There is fierce competition among device makers, which will undoubtedly lead to heavy commoditization. Security issues and painful product failures are abound. The Smart Home might be one of the biggest IoT markets, but these elements are not a reflection of a highly mature, stable IoT developer ecosystem. One can’t help wondering whether Smart Home is a good school for starting IoT developers, and whether or not it will yield skills that can easily be transferred to other IoT verticals in the future.

What’s next? What comes after Smart Home? Which other vertical markets are IoT developers considering?

The biggest loser in terms of developer popularity is Retail, which experienced a drop of 10 percentage points in one year, from 33% to 23%. Retail is big business, responsible for $22 trillion USD in 2014 or 28% of global GDP, and growing. It was (and is) an obvious target for early IoT efforts. But the hype around first RFID and then location beacons seems to be cooling down. Beacons in particular have not delivered on the promised transformation of the shopping experience so far, plagued by issues of app discovery and opt-in

Almost half (48%) of the IoT developer population now targets the Smart Home.


requirements, lack of standardization, practical implementation difficulties making the solution unreliable, and murky benefits for users and businesses alike. This said, Retail is still in the top five most popular verticals, and we can assume that a substantial group of developers and entrepreneurs will keep chipping away at this sector.

Other verticals are stable over time, with no clear, sustained, trends in developer popularity, despite the hype around some of them. This stability is relative, of course; the absolute number of developers might still be growing together with the overall IoT developer population. We’ll have more to say on that in our upcoming IoT Developer Population report.

The Wearables market is still soul-searching, but lacks real forward momentum. Companies are jostling for position, like Samsung, who recently stopped producing Android Wear watches in favor of its own Tizen platform. Android has updated its Wear platform, but mostly it seems developers are getting more of the same. Apple felt compelled to thoroughly rethink the user interface for its Watch, after disappointing user reviews and lackluster developer attention. IoT developers are interested in Wearables – it remains the second highest ranking vertical market – but they are also apprehensive.

The Industrial IoT market similarly makes steady progress on the platform front, without any radical shifts in technology or developer interest. The drop in relative popularity in the past year is, in part, explained by the inflow of inexperienced developers, for whom

Industrial IoT is not a good entry point. In part, IoT developers are focusing on fewer verticals. Some multi-vertical IoT developers might have actively dropped Industrial IoT over the past months, realizing that it would be difficult to succeed there without focusing on it exclusively.

Health & Wellness has perhaps the best potential for fast-rising developer interest. This vertical is surprisingly consumer oriented: 45% of professional IoT developers in this market target consumers, more than in Smart Home or Wearables. Some developers might be trying to disrupt the traditional healthcare system with new technology; others want to ride the Silver Tsunami, the phenomenon of aging population in many highly-developed nations. While there is no sustained growth in developer mindshare for this vertical yet, it is certainly an area to watch closely.

The Connected Car market was abuzz with excitement over car apps in 2013-2014 (remember Android Auto and Apple CarPlay?), but enthusiasm has since stalled. In our Q4 2014 survey, 34% of IoT developers who were not already developing for the car, were planning to do so in the future. Most of them seem to have given up on those aspirations, at least for now – there is no noticeable rise in car developers. The rollout of Android Auto and CarPlay is excruciatingly slow, and the conversation has moved on to autonomous driving and artificial intelligence; highly specialised areas that will be out of reach for most developers. Platforms that focus on vehicle data are not yet mainstream.

What’s to come? Will we see IoT devs soon migrating to more enterprise oriented markets? We’ll keep watch! Meanwhile, we’ll dig much deeper into IoT developer trends in our upcoming IoT Landscape 2016 report, due in October.

The biggest loser in terms of developer popularity is Retail, which experienced a drop of 10 percentage points in one year, from 33% to 23%.


None of these are new areas of technology but all have become more prominent thanks to technical developments, sparking new focus and attention. Is all the media hype reflected in developer activity? Certainly the two are not proportional. The messaging bot hype has been at fever pitch in recent months, and yet there’s relatively little developer activity so far. At the other end, Machine Learning is probably the least hyped of the three and has the most developer activity. There are some fantastic opportunities in all of these areas and we’ll be publishing dedicated reports on each later in the year. However, for the rest of this chapter we’ll focus on the two that are currently attracting significant numbers of developers.

The battle for the next interface Technological change is accelerating. It seems almost impossible to believe that 10 years ago no-one had a modern touchscreen smartphone and now 2 billion are in use around the world, most of them used for hours daily and many essential to lives and businesses. If we accept the speed with which this change has happened, it

shouldn’t be too hard to believe we may be interacting with digital content and services via something other than a small black rectangle 10 years from now. In this regard, Virtual Reality may be a side show. Part of the attraction of the smartphone is that it’s always available, fitting into the gaps between other activities and usable almost anywhere. Strapping on a VR headset and stepping into a virtual world is unlikely to be something most people will do in public places anytime soon. However, there are potentially industry changing applications of VR to come in entertainment, communications, and education. Also, many of the technical solutions involved in creating a great VR experience may be used in AR too. The promise of Augmented Reality, or Mixed Reality as some like to call it, is that instead of digital worlds taking us out of the physical world, we can integrate the two. The ideal AR glasses, or maybe even contact lenses, of the future are not only always with us but able to see what we see. As such they can be used to provide interactions that are contextually appropriate and relevant. If a screen is required for some task then there’s no issue of size, with AR any sized screen can be projected onto the real world.

4 WHERE ARE DEVELOPERS LOOKING NEXT?

As part of the research underpinning Developer Economics we actively monitor industry trends and opportunities, looking for new areas of significant developer interest. In our 11th Developer Economics survey we investigated the emerging trends for Augmented Reality (AR) & Virtual Reality (VR), Data Science & Machine Learning, and Messaging Bots.


Facebook has invested heavily in VR, starting with the acquisition of Oculus. Most of the games industry is similarly interested in working in virtual worlds as a much simpler problem than trying to build games into the real one. Google has focused on commoditizing VR using the smartphones already in users’ pockets, initially with Cardboard and now Daydream. They also have some fairly heavy investments in AR, with the partially paused attempt at Google Glass, a big stake in Magic Leap, and also Project Tango. Microsoft is focussing on AR with HoloLens and Apple is keeping silent about their plans as usual, although their acquisition trail and patent filings also point to a strong preference for AR. The question is whether the third party developers that create all the content and services believe in this future too? With nearly 23% of the developers who took our survey already involved in either AR or VR development, it seems that they really do. Most of those developers are very recently involved and 76% of them only as a hobby or side project. This is the way we usually see new technology areas explored when the commercial reality doesn’t yet support many paid jobs. The other thing our data points to is that these developers think it will be a consumer-first market. 44% of professionals in this sector are targeting consumers versus only 19% targeting enterprises. While AR smartphone apps occasionally take off, like the current Pokemon Go craze, for these technologies to reach their potential new personal hardware will be required. This does point quite strongly to the consumer market as the place to gain initial traction.

Making sense of data A side effect of there now being a 1990s-level supercomputer in 2-3 billion pockets worldwide is that we’re drowning in data. All of the data collected in human history, up to the turn of the millennium, is certainly less than we now generate every day. The Internet of Things is adding sensors to anything and everything, which will compound this problem. Some parts of the industry like to talk about Big Data. The term has been abused close to meaninglessness but at a

minimum we’re talking about too much data to process easily on a single PC. Definitely too much to load up in a spreadsheet and make a few charts. The thing is, data doesn’t have to get this big before it’s too complex for a human to “eyeball” it and spot patterns. This is where data scientists come in. A data scientist’s role is to extract useful information from a sea of apparently incomprehensible data. There are a wide array of statistical tools for doing this in a guided way but when the dataset is very large, complex, or analysed in real-time, a popular approach is to have the computer analyse the data and figure out what’s important. To achieve this the machine needs to learn about the structure of the data.

The idea of machine learning is an old one. Some of the early pioneers of computing believed that self-modifying systems that learn from real world data are the best possibility for producing artificial intelligence (AI). They didn’t have the hardware or software tools to build such systems but their intuition was good. The first artificial neural networks were implemented in the 1950s. However, by the end of the 1960s it became clear that the computing power available at the time was insufficient to train more complex networks, capable of solving non-trivial problems. Focus shifted to a range of other techniques, many of which have become mature and useful tools. Not everyone gave up on neural network approaches and eventual improvements in training algorithms and ongoing increases in computing power created breakthroughs. A set of techniques for structuring and training many layered neural networks, collectively known as Deep Learning, started reaching record levels of performance in a wide range of problems. Machine learning tools are

The question is whether the third party developers that create all the content and services believe in this future too? With nearly 23% of the developers who took our survey already involved in either AR or VR development, it seems that they really do.


now at the forefront of AI research again, as well as being indispensable to data scientists. The trick is that both the data scientists and the AI systems are using machine learning tools to find structure and patterns in complex data. The output from the machine learning systems used by data scientists is being used to support human decision making at many of the largest organisations in the world. The output from machine learning subsystems within an AI system is used to drive autonomous behaviour.

The really headline-grabbing breakthroughs in AI have come in the last year, so it’s perhaps not surprising that machine learning has a lot of developers newly interested and exploring via a side project. Data science and machine learning in general have been helping companies do more with their data for several years now, so the fact that 41% of the developers in our latest survey are involved in some way makes sense too. 33% of them are professionally involved, and they show more of a bias towards enterprise and internal audiences. If we look at the hobby and side project activity it’s clear that a lot of developers are just learning the ropes. 41% are not sure what

audience they’re targeting, typically suggesting a pure technology exploration. Across the whole sector open source toolkits in Python and R are extremely popular, whilst there are smaller but clear early signs of interest in internet-giant-backed offerings like Google’s TensorFlow.

Skills for the future Although there are already important and highly profitable applications for these emerging technologies, it’s clear that they have much bigger roles to play in the future. The global developer population is busy levelling up their skills to co-create that future, or at least be ready to benefit when it arrives. The huge interest in AR, VR, and Machine Learning, when compared to the relatively tiny activity levels in messaging bots, is perhaps in recognition of their significance. Indeed, unless we integrate computing directly with our thoughts, AR might be the final interface paradigm. Similarly Machine Learning is likely to be a central part of most of the really important systems created in the future. It’ll be the magic behind many amazing new products and the automating force that comes to replace many white collar workers. Hopefully technology will be giving with one hand while taking with the other, creating jobs in our virtual and augmented worlds to replace the ones it’s eliminating from the physical one. If not, being a developer with skills in either or both of these areas may be one of the safest places to be.

Data science and machine learning in general have been helping companies do more with their data for several years now, so the fact that 41% of the developers in our latest survey are involved in some way makes sense.


Developer Economics 11th edition reached an impressive 16,500+ respondents from 145 countries around the world. As such, the Developer Economics series continues to be the most global independent research on mobile, desktop, IoT and cloud developers combined ever conducted. The 11th Edition has expanded our scope, now also the most global research on augmented and virtual reality developers, as well as machine learning developers and data scientists. The report is based on a large-scale online developer survey designed, produced and carried out by VisionMobile over a period of six weeks between April and May 2016.

Respondents to the online survey came from over 140 countries, including major app and IoT development hotspots such as the US, China, India, Israel, UK and Russia and stretching all the way to Kenya, Brazil and Jordan. The geographic reach of this survey is truly reflective of the global scale of the developer economy. The online survey was translated into 9 languages (Portuguese, Spanish, French, Turkish, Russian, Korean, Japanese, Chinese (Simplified), Vietnamese) and promoted by 59 leading community and media partners within the software development industry.

To eliminate the effect of regional sampling biases, we weighted the regional distribution across 8 regions by a factor that was determined by the regional distribution and growth trends identified in our App Economy research. Each of the separate branches: mobile, desktop, IoT, cloud, augmented and virtual reality, and data science and machine learning were weighted independently and then combined.

To minimise other important sampling biases across our outreach channels, we weighted the responses to derive a representative

distribution for platforms, segments and types of IoT project. Where we had sufficient historical data we used a Random Forest to calculate appropriate weights. In new branches and areas where response options had changed significantly we compared the distribution across a number of different developer outreach channels and identified statistically significant channels that exhibited the lowest variability from the platform medians across our whole sample base. From these channels we excluded the channels of our research partners to eliminate sampling bias due to respondents recruited via these channels. We derived a weighted platform distribution based on platform data from independent, representative channels. Again, this was performed separately for each of mobile, IoT, desktop and cloud, augmented and virtual reality, and data science and machine learning.

In addition we have historically only allowed each developer to answer questions related to a single area of development, selected randomly from the ones they indicate involvement with. In this 11th edition survey we have allowed developers to select which development areas they answer questions about and to answer questions about multiple areas. This captures significantly more data and allows us to look at the choices of a single developer across areas. However, it also creates a selection bias that favours professional developers in each area, as developers tend to select areas in which they are involved professionally. We applied a correction for this on top of the other weighting of responses to make the distribution of professionals and hobby/side project developers representative of the overall involvement in each development area.

METHODOLOGY


distilling market noise into market sense

Developer economics state of the developer nation q3 2016

Technology

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