TEM and MMS are rapidly evolving into much broader Technology Expense Management platforms. Enterprises need to understand why this is important and critical.
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TEM and MMS are rapidly evolving into much broader Technology Expense Management platforms. Enterprises need to understand why this is important and critical.
To immediately download a report excerpt please provide the requested information.
I get to join several product demonstrations each month and speak with various technology companies about the current and next-generation problems they are working to solve. Sometimes you hear about products when it’s too late, when you don’t work with a client anymore who might have benefited from a solution or a solution they tried killed implementation completely.
When speaking with Blue Cedar CEO John Aisien last week, I found a product that could have helped me solve for a problem a client was challenged with in 2016. John and his co-founder Kevin Fox have assembled a team that is simplifying the role out of BYOD for enterprises and delivering seamless security solutions for heavily regulated B2C organizations focusing on mobile applications for their users. They have competition in the space, but I noticed a differentiation between them and the more commonly known providers in EMM.
How? By placing the Blue Cedar Security Injection product directly into an organizations application development tool-kit. The solution lights up a security control center to monitor, track, and control the applications behavior on any given device without any use of the traditional MDM products. They are moving the line on untrusted user access, creating a tool that enables the enterprise to securely mobilize their entire workforce, and with the varying controls that enterprises are accustomed to in the MDM services we utilize today. The key difference, however, is that there is no MDM agent required to sit on any BYOD device – a huge move to full enabling BYOD.
I see Blue Cedar taking serious strides to simplify the mobile application security management questions that enterprises are boiling water over today. Their recent announcement of a partnership with Neptune Software and their Rapid Mobile APP Development Platform, as well as their ongoing work with SAP is evidence of this. And they are developing a tool set that becomes more critical as we expand our hardware connectivity and computing capabilities from a centralized secure location to the edge.
Blue Cedar completely solves a very real enterprise security problem.
The client this made me think of is a pharmaceutical company that took the strategic initiative to bring mobile technology to their clinical trials. What an opportunity – and challenge – to securely generate valuable user data.
Think about it; this company runs more than 200 clinical trials annually and for varying lengths of time. The number of participants per trial varies from 50 to tens of thousands, and the user make up is diverse and unique to each clinical trial they run. None are employees and they’re not consumers whose data can be shared, viewed, or left unattended.
It’s not that the users could not be trusted with their own data. The question really surrounded how to securely deploy an application that would collect highly sensitive and proprietary data from a decentralized and uncontrolled user group?
The solution at the time was to loan these users a corporate-owned tablet, pre-configured with a Mobile Device Management (MDM) application, coupled with Apple’s Device Configurator (I know, I cringed too), a custom-built in-house application specifically for use in this trial, and a robust logistical support strategy for replacements, software and application updates. We started with a user group of 250 participants in one country and had some other challenges to consider.
We knew right away that this would be expensive and technically challenging to scale from one trial to more than 200. Each clinical trial requires its own application(s) and connectivity capabilities with other 3rd party applications, and maybe even wearables or connected medical devices and other controlled systems. Not every user needs a device, but not every user doesn’t need a device.
If I were to guess, 80 percent or more of the total users globally could be BYOD users if a tool like the Blue Cedar product were deployed in their application development strategy. It solves the security conundrum that MDM was meant to address while delivering a high volume of logistical and user support savings. Otherwise, a client would spend hundreds of millions of dollars on one-time-use hardware and the tracking of 3rd party software licenses.
The remaining 20 percent of users who receive a device for the term of their trials would leverage the same application, but with a far less complex device configuration setup and logistical support network. This would further save the company millions in support and deployment costs.
Who else is solving for complex mobile problems and weighed down by the cost and security of the hardware, and the security of the network? Everyone.
Mobility is now a table-stakes requirement for any organization to deliver on, and most companies that I speak with these days fully acknowledge this mobile reality. In an earlier blog post, “Managing Today’s Enterprise Mobile Projects – The Right Partners are Critical to Success,” I strongly suggested that, as large SMBs and enterprises embrace mobility for significant strategic business initiatives which typically have very short windows of opportunity for successful deployment (what I sometimes refer to as fast and furious mobile deployment), there will be plenty of opportunity for unsuccessful results.
Companies that either fail to plan properly for their projects or that opt to try and manage their mobile deployments internally will find themselves on the sure road to mobile project failure.
What must businesses do to ensure they avoid that road?
Over the 16 years, I’ve covered enterprise mobility I can identify three distinct eras of enterprise mobile computing. This first, the pre-iPad era running from 2001 to 2009, we can now think of as ancient history. Some might argue that the ancient history ended in 2007 when the original iPhone was introduced, but this isn’t true. It was the combination of the iPad and the generation of iPhones that emerged in 2010 that were the critical mobile game changers.
Next are the middle ages covering 2010 to 2014, a five year period that saw the real foundation of enterprise mobility – mobile devices, wireless communications/bandwidth and mobile software capabilities – fall into place. Finally, we have the era we now live in, the Renaissance…in the truest sense of the word – enterprise mobility rebirth.
Rebirth? Yes. Despite the many exciting business transformation promises of anytime, anywhere capabilities mobility brought to enterprises and regardless of BYOD and how many pioneers sought to gain business advantages through it, mobile technology as a key enterprise enabler went through a slow slog of growth. It left many enterprise mobile researchers wondering if mobility would ever become as transformative as we kept predicting it would be.
In 2015 that all changed – suddenly and quickly. In what I define as a true mobile inflection point a great many businesses across every possible vertical market had the sudden and urgent realization that despite apparently slow enterprise mobile adoption there was substantial – in fact enormous – progress being made at those companies that had chosen to embrace mobile technology early on.
From my decades-long perch as an observer of leading edge technology (no kidding – I used to write a column called The Observatory for Internet World back in the day – hmm, in fact I may revive it) I have witnessed many technology-driven business transformations. Some of those transformations were driven by “killer apps” of course, and some emerged over a fairly lengthy period of time.
Over time? Yes – think for example of the “Year of the LAN” mantra many of us witnessed from 1990 – 1992. I believed in it so much I left Microsoft to become part of the startup team for a tech journal dubbed Network Computing (NWC as we fondly knew it) in 1990 to capture the moment. The truth of the matter, however, is that we never had a year of the LAN. Rather it sneaked up on us and one day in 1993 we all woke up to discover that sure enough, we were all LAN-enabled – it had become the “age” of networking. Interestingly, NWC’s own journey echoed that path – we floundered financially (well, we broke even anyway) from 1990-1992 but then became highly charged and immensely relevant once LANs and networking technology became pervasive and business-transforming.
I can say the same for mobile technology. I became a mobile research pioneer (along with a small handful of other brave souls) back in 2002-2003, anticipating a revolution driven by enterprise mobility. Eleven years later, in 2013-2014, enterprises finally woke up to the strategic uses of mobility and are now finally driving the age of mobility.
That bit of personal history now brings me to another technology – Telecom Expense Management (TEM) – that is finally undergoing a unique renewal, at least among some of the more savvy industry players. Now let me be quite honest…some of us – ok, I – have long thought of TEM as the green eye shades end of technology. By this I mean a sleepy cohort of accountant-types reviewing endless wireline, landline and fax expenses, telecom bills, and analysis driven in large part by offloading most of the number-crunching and report generation to TEM vendors.
A somewhat more modern era of TEM began to emerge in parallel with the emergence of the Internet and Web yet the core functionality of “green eye shades TEM” remained essentially unchanged. Yet another age of TEM began to emerge in parallel with the maturing of smartphones, tablets and cellular-equipped laptops but the core functionality of TEM remained entirely unchanged. For me it has long been the case that just as history does green eye shades TEM simply likes to repeat itself. It was safe and reliable to stay the course.
It didn’t help the pace of TEM change that, as I noted earlier, enterprise mobility took over a decade to become relevant at a large enterprise scale. Sure, we had lots of technology change but the changes were not disruptive to businesses but merely evolutionary. Mobile-driven disruption has tended to occur on the consumer side – it did after all give us BYOD. Business technology however generally moved forward incrementally rather than disruptively.
Dig a little deeper into the TEM space and it is utterly clear that TEM has undergone a very long term evolution of incremental improvements since the 1990s but it has never needed to deliver business services that required it to be disruptive in any real sense. Traditional TEM capabilities – green eye shades TEM – have continued to serve businesses well.
But…The TEM Times are A’Changin’ at a Supercharged Pace
Ah, but the safe harbor of incremental TEM technology improvements suddenly disappeared over 2013 and 2014. Actually and more accurately it became disrupted.
Enterprises found their way to becoming fully mobile-aware, cloud-driven infrastructure and services adoption (ITaaS and MaaS) grew at lightning speed, big data became really big, and the Internet of Things (IoT) became not only real but profoundly real. Under the covers processors and memory became many orders of magnitude faster and richer in capabilities, and newer technologies such as software defined networks (SDN, SD-WAN), in-memory databases, business intelligence/analytics and machine learning all became enterprise-ready – and deployed.
“Real time” literally became real time…in the moment, of the moment, at the moment. Even simple decision making became disruptive – and a strategic advantage.
These technologies, among others I haven’t noted, suddenly became highly disruptive in nature and began driving enterprises to rapidly adopt the technologies and adapt to the fast-paced technology changes taking place. Enterprises that are seeking to embrace today’s new technologies – and in particular those companies that recognize that today’s technology disruption cycle makes it vital for them to do so – are now declaring “green eye shades TEM” as inadequate for meeting the needs of today’s transformative business ecosystems.
The TEM market in turn suddenly found itself in need of stepping up and greatly broadening its own capabilities, especially in the wake of realizing that there is now a wealth of new opportunities to extend its services beyond core green eye shades TEM to managed mobility and IT Expense Management (ITEM). The industry’s key association, TEMIA, is itself in the process of defining ITEM and the significant shift it entails for businesses.
History is actually beginning to change for TEM instead of repeating itself. Blue Hill Research has noted these emerging opportunities for TEM vendors – which now includes the need to seamlessly monitor and manage recurring telecom, IT and mobility expenses, including the emergence of IoT expense management.
Our research team has taken a strong stab at looking underneath the covers of what it takes to transform from TEM to ITEM – check out “Applying TEM Best Practices to Optimize Your Cloud Investments” for the inside look on this.It provides a great blueprint to assemble the right enterprise strategy to ensure both your TEM and cloud platforms are fine-tuned for both your present and future needs.
We’ve also been investigating which TEM vendors are best positioned to take advantage of this wave of technology disruption and emerging opportunities for their own business growth. We’ll deliver a research report in the near-future on it.
I’ll wrap this up by also elaborating slightly on the two acronyms I casually dropped earlier – ItaaS and MaaS. “IT as a Service” is a useful term to define the general underlying platforms TEM vendors are now launching to meet the challenges of transforming from TEM to ITEM vendors. In great part this is important as well because a key enterprise consideration for TEM vensor-driven ITaaS is to deploy it to optimize enterprise investments in cloud computing. I recently delivered a webinar on this topic for Calero’s Calero World 2017– check it “Utilizing TEM Best Practices to Optimize Your Cloud Investments (http://connect.calero.com/utilizing-tem-best-practices-optimize-investment).”
“Mobility as a Service” is the emerging means of describing the end to end Managed Mobility Services (MMS) solutions vendors such as Stratix are now deploying. More on this in an upcoming blog post. Stay tuned!
Previously, I observed how the evolution of the cloud has led to considerable growth in cloud solutions within legal environments. At the same time, concerns about the security and privacy of cloud environments have created obstacles to adoption among the profession. For the legal community, the contradictory opportunities and risks presented by the legal cloud results in a tension between attitudes that, at their extremes, we can refer to as “cloud complacence” (or an uncritical trust in cloud providers) and “cloud anxiety” (an uncritical refusal to consider cloud solutions). Cloud-complacent and cloud-anxious attitudes both work, in effect, to increase law firms’ vulnerability to risks, on the one hand, or to deprive them of the real benefits of a cloud solutions, on the other.
Part of the problem is that both cloud anxiety and cloud complacence stem from very reasonable responses to cloud computing. It is not unreasonable to believe that cloud providers (who by the very nature of their expertise and business models) will invest in the security and integrity of their solutions, generally with a sophistication that is lacking at law firms. Nor is it unforgivable to feel uncertain about the sufficiency of these efforts, particularly given some high profile incidents which have erupted over the past year. In fact, for a reasoned articulation of (and response to) cloud anxiety, see Sam Glover’s take on Lawyerist. The trick lies in understanding how much trust or suspicion (or both) is reasonable to find a way that balances the risks and benefits of the cloud. This requires understanding the nature and sensitivity of the data that you putting into the cloud, and how a particular solution protects and potentially exposes that data.
There are a several relevant factors to consider here. First, a basic understanding of what’s involved in data security when using mobile-cloud (the successor to the endpoint-server paradigm):
1) Servers – Generally, cloud offerings transfer data that was held on dedicated hardware physically located within the walls of the firm to remote, shared servers controlled by third parties. What those third parties do to protect and maintain the integrity of these servers is thus an important aspect of cloud security. It is also the most obvious element to consider. Other important questions here relate to multi-location failure, and the extent to which server space is shared or dedicated.
2) Transfer – For the cloud to work, the data and applications stored on remote servers must be accessible by users through their computers and mobile devices. How this data is exposed or protected in transit between cloud servers and these access points is also a crucial element of the overall security of the cloud. The core questions here typically relate to identity encryption and secure data transfer.
3) Access Points –One of the advantages of the cloud is how it opens up the freedom to access data from a wide variety of devices and locations. This also increases the opportunities for exposure. Many devices automatically log into cloud systems and save local copies of the files stored on the cloud servers. As such, we need to be concerned with the security of the device itself, as well as the ability to control it after it leaves physical possession of the firm. The security literacy of users is often an important element here as well.
Different providers take different approaches in how they address these needs, leaving firms with a range of options to consider. Let’s look at a few basic approaches to provide some context for these strategies, and what they mean for your firm’s use of the cloud.
Again, we’ll start with the obvious option. Many legal cloud vendors have responded to the market’s concerns by improving encryption and server security. The need for strong security has prompted vendors to use security efforts as a matter of differentiation. Key factors here are the security certifications and protocols used by the cloud provider. Firms with dedicated IT resources can suss out the meaning of the terms that are used in these environments, but smaller firms often lack the background to translate the terms and standards referenced into a practical understanding of how secure it will be.
While a little self-education is a healthy thing, vendors often opt to use a number of shorthand tricks to signal the trustworthiness of their platforms by highlighting the:
– Number of certifications obtained. For example, cloud practice management provider Clio highlights that it possesses three certifications (by VeriSign, TRUSTe, and McAfee Security), even if the standards themselves are somewhat redundant, primarily verifying the use of Secure Sockets Layer (SSL) encryption (although the TRUSTe certification also identifies incorporation of its privacy standards).
– Adoption of known security standards or industry requirements. For example, Box and Microsoft Matter Center for Office 365 both underline their compliance with HIPAA and EU security and privacy standards as a way to indicate their appropriateness for legal environment. (Microsoft also lists ISO 27001 and Federal Information Security Act compliance, and goes so far as to identify its own security expertise as a consultative value-add for legal customers.) MyCase (which leases cloud space from Amazon Web Services EC2) and cloud ediscovery provider Logikcull both take pains to identify that they leverage “bank grade” security (which again is largely SSL).
– Physical security at data center sites. Box and MyCase highlight the physical security and disaster precautions of their data centers. Kroll Ontrack goes further, identifying steps taken to ensure temperature control and power supply redundancy.
Moving to a Private Cloud
Generally speaking, when we refer to cloud offerings (in the legal sector or otherwise), we are speaking of “the public cloud,” or cloud resources that are available for public use. On public clouds, server space is shared, and an individual user’s data might be distributed across multiple servers and data center locations. In this way, public cloud offerings maximize the economies of scale that supply the cost advantages of cloud solutions, and can potentially create exposures and a lack of transparency regarding data location and control.
Private clouds represent an effort to avoid the latter issues through dedicated cloud resources. While they can be provided by third parties (or maintained internally), private clouds are distinguished in that the servers involved are only used to support a single organization. This helps maintain the control over the network. In addition, hybrid clouds offer a middle ground to segregate data between private and public clouds as appropriate.
Typically, legal cloud providers are public cloud providers, with private and hybrid offerings generally offered by core IT infrastructure vendors, such as IBM, HP, VMware, and others. The leading voice for private clouds in the legal technology space has been Abacus Law. While its roots lie in practice management, Abacus Law has recently made strides as a hosted legal infrastructure provider through its Abacus Private Cloud environments. The provider takes an agnostic approach to its private cloud offerings that do not tie customers to its practice management solutions, or any sort of solution. In fact, the company has indicated its willingness to run other vendors’ solutions within its environments, effectively adding an extra layer of assurance for cloud offerings and flexibility for other applications.
Private clouds reduce some risk of public clouds, but are not a panacea. In particular, they do not necessarily alleviate the need to perform complete due diligence. Firms still need to understand the security related to servers and data transfer, particularly with respect to hosted solutions. Private clouds also do not protect the end access points of the solution.
A third approach taken by vendors is to maintain flexibility in deployment, offering customers the ability to select cloud or on-premises options, rather than force them to use a particular offering. Generally speaking, these efforts are dictated by a desire to maintain flexibility to meet varying customer need. As such, in some part, they function as accommodations to cloud anxieties. Prominent examples of this strategy include Microsoft’s Matter Center for Office 365 and Amicus Attorney, both of whom have stressed the flexibility to offer public cloud, hybrid cloud, and on-premises offerings. Ediscovery vendors, who frequently encounter tensions between data storage, multi-party access, and high privacy sensitivity, have been particularly open to maintaining the flexibility of deployment options. To this end, Guidance Software, kCura, Recommind, Kroll Ontrack, and LexisNexis Concordance (to name a just a few) all offer options for hosted and on-premises solutions.
Ultimately for the vendors, this approach is about preserving opportunities by adapting to end-user comfort levels. For end users, it’s about obtaining the desired software capabilities with the flexibility to select or avoid the risks of cloud deployment. However, while this approach offers multiple paths, it does not necessarily answer questions about the vendor’s cloud solutions. In other words, while vendors falling into this category can often respond to end user preferences for deployment, firms selecting cloud options will still need to perform full due diligence regarding the solution.
Securing Access and Collaboration
The final category we’ll consider is primarily about securing the access points we mentioned above as much as anything else. If the other categories described largely related to differentiating solutions through reassuring firms about server and data transfer security, this category is about mitigating the risks associated with the expanded accessibility of cloud offerings. In other words, we’re discussing approaches intended to neutralize access-point risks.
Because this is a by-product risk of the legal cloud, rather than a barrier to adoption, this area has not received the same amount of focus as the approaches mentioned above. That said, a few players have sought ways to combat these issues, primarily by partnership with providers focused on supporting mobile environments. The primary strategy in this context has been to supply enterprise mobile management (EMM) or mobile data management (MDM) providers with expertise in supporting the distribution and control of data across large and diverse sets of device users. Leaders in this area include LexisNexis for its integration of Firm Manager with WatchDox, and kCura for its integration of Relativity Binders with MobileIron. Generally speaking, these integrations focus on combatting end-user risk by providing the capability to monitor, manage, and eliminate cloud access and data use on individual devices.
While the opportunities created by these integrations largely turn on the use of a particular legal function-oriented vendor (typically practice management), other vendors have focused on this particular need. To this end, EMM vendor AirWatch has sought to provide device and mobile content management capabilities independent of other solutions. Similarly, Box has focused on providing similar capabilities for managing and monitoring access to file permissions, access, and use from its storage environments. Microsoft’s Matter Center product responds to these concerns by keeping all data within cloud environments, eliminating local data exposures.
By and large, major movements in this area relate to either dedicated offerings, or integrations involving cross-enterprise providers tailored within the legal space. That does not mean that other options are not available. In particular, the last year has seen the entrance of TitanFile. TitanFile stands out as a provider focused on offering a secure collaboration platform for the legal space, without tying users to a particular data or document management environment. Rather, TitanFile encrypts files at the end-user source and serves as a content management and secure collaboration layer for attorney and client communications and document sharing.
Determining the Fit to Your Organization
Given the variety of paths that vendors take across these needs, it can be difficult for firms to compare providers to determine exactly what they need. In practice, this reinforces the need for self-education on the part of firms regarding the mechanics of the legal cloud. At the same time, it points to the need for a dedicated data security standard within the legal industry. The closest we currently come is ILTA’s LawSec efforts to disseminate ISO 27000 within the legal industry. While ISO 27000 is a prominent and well-regarded standard, it is not tailored to the legal sector.
There is a significant opportunity here for solution providers, firms, state bars, and professional associations to come together to develop a meaningful set of requirements and certifications for the industry. Even if it’s just an application of ISO 27000, the creation of industry-specific standards will go a long way to facilitate law firms’ understanding (and likely adoption) of security practices as well as help navigate a path through the extreme responses to the legal cloud.
In case you weren’t aware of it, IBM’s expansive mobile group has recently formally aligned itself in a partnership with Xamarin, a very sharp company that will now provide IBM with a mobile development platform that allows C# developers to easily build native mobile apps in C# for iOS, Android and Windows Phone. The Xamarin platform includes a number of developer tools as well as a cloud-based app testing ecosystem. On the IBM side IBM’s MobileFirst platform – which includes IBM’s own Worklight mobile app development platform – will provide Xamarin-built apps with cloud and backend enterprise connectivity and data services.
The Xamarin and IBM partnership drives home for me that mobile app development in the enterprise is becoming extremely “frothy.” Though I believe that we’ve been riding the enterprise mobile app wave for several years now, mobile app and MBaaS vendors alike are making a lot of noise about 2014 and 2015 proving to be the true “tipping point” years. For argument’s sake I will grant them this point. That leaves me wondering, however, if we now entering a true golden age for enterprise mobile app development, or if we are instead in the process of watching a bubble emerge that may be nearing its bursting point.
I will come back to Xamarin, IBM, and the question of an enterprise app development platform bubble. But first, a few more words on MBaaS platforms, which are important to Xamarin’s future success, are in order.
MBaaS Matters a Great Deal
Last week, I spent some time thinking on MBaaS (Mobile Backend as a Service) becoming the new enterprise mobile architecture of choice. There is one very interesting and key underlying notion about MBaaS: that its major goal is to give enterprises a great deal of freedom (or a liberation from the shackles of enterprise IT infrastructure, to put a bit of a literary feel to it) to focus their time and efforts on developing rich mobile solutions that meet “business needs.”
Cloud computing and platform as a service (PaaS) capabilities that easily replace old school infrastructure are two of the critical markers that define MBaaS. There are two other markers. The first is the ability to “easily” connect with the myriad backend app and data servers and other enterprise sources (that can include occasionally looney legacy systems such as an old early 1990s VAX system) that a business may need to tap. Extensive yet also simplified backend connectivity capability truly defines MBaaS – at least that’s what I think.
I can also add to the mix here DBaaS – the emerging Database as a Service “next wave” – which startups such as Orchestrate are moving to deliver on. From the 20,000 foot POV DBaaS provides a simple set of APIs that a company can utilize to connect to numerous and diverse backend database systems. I’m going to leave DBaaS for another day, but keep it in mind nonetheless.
The final marker is the very open-ended nature of MBaaS on the mobile app development platform side of things. As important as the cloud and backend services of MBaaS are to its immediate and long-term success, it will likely be the flexibility enterprises gain relative to the development tools they can use (such as Xamarin) to actually build their mobile apps that may prove the most significant marker overall in terms of what will ultimately be the greatest driver of MBaaS mass deployments.
From here, it is just a very short leap to extending the enterprise mobile app possibilities out to both the Internet of Things and to enterprise wearable tech. 2015 will indeed be a very interesting year for enterprise mobility!
Lots of Flexibility and Choice
Before I go on, I want to make absolutely clear that there is an enormous amount of complexity that underlies MBaaS. It has been an extraordinary technical challenge that the MBaaS vendors have taken on. Making cloud-based services and complex backend access and implementation appear “easy” to the enterprise – such that enterprise IT teams can almost think of an MBaaS as a nifty mobile development black box – is an unparalleled technical achievement. By this, I mean to equate MBaaS to the emergence and total integration of LAN/WAN in the 1990s, and the Internet/Web since the late 1990s, into the very DNA and fabric of all businesses large or small.
In a few years, all enterprises will have fully integrated MBaaS into their DNA as well. I will go so far as to say that I’m highly confident the security that is part and parcel of successful MBaaS platforms will be such that even today’s on-premise bound verticals – healthcare in particular – will all eventually find themselves MBaaS-based. The demise of on-premise computing is close at hand!
What the MBaaS vendors have achieved is a pure cloud and backend technical accomplishment. But in the grand continuum of enterprise mobility we arrive now at the ultimate judge or arbiter of any mobile application and development effort – the end user (whoever that may be – workforce, partners, customers, or large scale collections of consumers).
One thing MBaaS platforms won’t be able to ensure is the final outcome on how delighted end users will be with the mobile applications that are ultimately delivered through any MBaaS platform. The technical wizardry (and occasional black magic) employed by the MBaaS vendors can only go so far…they can and will free up enterprises to focus on their business needs, but they cannot help businesses actually develop their mobile-based business solutions and apps. Of course.
What MBaaS does do is create a great deal of freedom for enterprises to pick and choose the actual app development platforms that are preferred within an organization or that an organization’s development team may have expertise in. This approach maximizes developer flexibility, and minimizes the need for developers to have to use specific and likely unfamiliar tools required by a given platform.
The reason that the MBaaS vendors focus a great deal of marketing effort on the ability to create “agile” mobile app development environments for their customers is due to this developer tool flexibility. This flexibility in turn gives organizations a great deal of opportunity to focus specifically on business needs as the basis to quickly deliver finely-tuned mobile apps. This is something I will be exploring in detail over the coming weeks and won’t take any further here. It is worth mentioning, however, that the Xamarin-IBM partnership now exists at least in good part for this very reason.
Are Xamarin and IBM a Good Match?
As a front-end development platform and framework, Xamarin has gained a lot of ground in a relatively short period of time. It claims that its platform – which focuses entirely on C# developers – is now used by more than 750,000 developers, some of whom come from over 100 of the Fortune 500 (including Dow Jones, Bosch, McKesson, Halliburton, Blue Cross Blue Shield and Cognizant). That is a heady number of developers, and represents more than 10 percent of the total estimated population of just over 6 million C# programmers.
The partnership with IBM gives Xamarin’s developers integrated access to IBM MobileFirst – and IBM Worklight, which provides Xamarin-built mobile apps with an entirely new suite of secure cloud-based data services (sounds like MBaaS, doesn’t it?). Xamarin and IBM now provide an SDK for Xamarin developers that can simply be embedded in their mobile apps to integrate, secure and manage apps with the IBM MobileFirst platform.
There is much more to what the two companies actually put on the table, but the implementation details aren’t important here. What is important is that Xamarin is now able to provide IBM-sourced cloud and data services capabilities for those Xamarin developers that can benefit from it.
IBM, meanwhile, adds yet another arrow to its already full mobile quiver. Xamarin integration simply provides IBM with the ability to offer its enormous collection of mobile customers additional mobile app developer flexibility, and choice in how they want to – or prefer to – build their apps. Xamarin obviously also gains IBM’s mobile endorsement through the partnership; that will clearly open many new doors for Xamarin.
So yes, it is definitely a good match.
A Bubble or a Golden Age?
The answer to the question I’ve posed depends entirely on whether or not I’m right about how MBaaS is going to play out. If MBaaS does indeed emerge as technology that becomes part of overall business DNA (again, as LAN/WAN and the Internet/Web have become), then it makes a great deal of sense to have substantial app development flexibility and development platform and framework choice.
If MBaaS deployment runs into roadblocks, and if other cloud service options that limit developer choice emerge and become dominant instead, then the current proliferation of MBaaS and app development platforms (along with all the startups in the space) will indeed look like an unsustainable bubble.
That won’t happen, though – I like to think I’m right about MBaaS.
Enterprises really do face a tremendous need to get great mobile apps out the door – there is enormous enterprise demand now being generated for MBaaS and developer flexibility and choice because of this. Assuming that businesses take their strictly business-side mobile homework seriously, the infrastructure and development tools will be there to get high quality mobile apps out the door.
Red Hat/FeedHenry, Kinvey, Pivotal/Xtreme, Appcelerator, AnyPresence, Kidozen, Cloudmine, Sencha, Xamarin, Orchestrate and many other startup and established vendors (among them the usual suspects amid the giant tech companies) all stand to make a mark here. Enterprise mobility is ready to pay out on the bet.
For those of us who have been waiting since the early 2000s for such a mobile moment to become real, it is indeed looking like a golden age is finally here.
Several weeks ago, nearly $100 million dollars were put on the enterprise mobile app table, reflecting sharp bets that the new mobile application platform game in town is now MBaaS – Mobile Backend as a Service. The first of these bets was placed by Red Hat when it reached an agreement to acquire FeedHenry – in my opinion the most mature of the MBaaS independent vendors – for a substantial $82 million. For a company sporting a single previous investment round of $9 million that amounts to solid FeedHenry ROI for all concerned.
Nearly concurrent to the Red Hat-FeedHenry acquisition, the second bet came in the way of a Series B funding round for Kinvey, which I believe is a close second to FeedHenry in its MBaaS strengths and capabilities. The Series B is worth $10.8 million – coupled with an earlier Series A round of $7 million investors have now placed a $17.8 million bet on Kinvey, and quite honestly that looks to me like a damn fine bet to have made. I expect big things from Kinvey – and no doubt there is yet another major MBaaS acquisition to be made here at some point.
My detailed report on Red Hat’s acquisition of FeedHenry underscores not only the many good reasons why FeedHenry and Red Hat are a perfect fit for each other (Red Hat provides substantial enterprise scale and market penetration, FeedHenry gives Red Hat true enterprise grade mobile app capabilities), but also outlines the advantages that MBaaS platforms bring to the mobile enterprise application game.
Enterprise mobility has been around for more than 10 years, though it wasn’t relevant on a large scale until the current decade arrived and brought with it Apple’s iPad and iPhone and of course BYOD. Mobile development platforms (we all know the old acronyms – MADP, MEAP) have traditionally been built around client-server architectures, and have ruled the enterprise roost for many years. Some of these platforms were better for building monolithic single purpose mobile apps, some lent themselves to mobile Web development, and the majority of them have required dedicated application development and management resources.
MADPs have certainly served useful enterprise purposes over the years, and there would be no enterprise mobility today without them. But technology constantly evolves, and to make what is a very long story short, even the most state of the art of these now legacy platforms cannot keep up with today’s across the board enterprise move to cloud-based computing. Their client-server roots now work against them, and to evolve their core platforms into modern day enterprise architectures is not a viable option. Embracing HTML5, Web apps, and native-hybrid app development is as far as they’ve come…but it isn’t enough.
Today’s modern day architectures – SaaS, PaaS, BaaS and now MBaaS – are the realities of today’s enterprise world. Collectively, cloud computing and these services drive the ability for enterprises to become far more interactive and dynamic. Mobility – driven by both consumer and workforce demand – now requires enterprises to literally “live in the moment.” Client-server mobile app platform architectures simply don’t lend themselves to tackling today’s definition of dynamic interactions.
Today’s Definition of “Dynamic”
Ironically, old mobile apps used to define dynamic enterprise applications – they were of course built to interact with users (whether workforce or external consumers) under anytime, anywhere conditions. But in truth these apps have ultimately tended to be static entities – once built, more often than not at significant development cost, they become single purpose apps.
Today’s definition of dynamic mobile apps has changed, and I’m not understating it if I suggest that the definition has changed radically. Those enterprises that can lay claim to being today’s mobile pioneers are those that are not only extending mobility out to the workforce, partners, customers and consumers, but they are as well living in the moment in building mobile apps dynamically.
The MBaaS mobile vendors all have a specific common view of how enterprises must now build their mobile apps to stay competitive or to gain competitive advantages:
– Primary stakeholders – line of business (LOB), IT and finance need to always be able to come together and quickly develop apps that meet revenue-generating and/or business intelligence gathering requirements (this is in fact our own Blue Hill mantra for any enterprise technology development)
– Other key stakeholders – for example the CMO’s office, need to be easily integrated into planning and development processes
– IT must have at its disposal significant flexibility to quickly bring together in the cloud both front end/user interface capabilities and easy backend connectivity to numerous potential resources
– Both mobile app planning and development must be collaborative and agile in nature – this requires embracing a myriad of development frameworks that are likely to already exist within a business and that developers already know well
– The key MBaaS competitive advantage is that all of the underlying complexity is handled by the MbaaS platform, leaving enterprises free to focus specifically on business issues, user interfaces and – most critical of all – in the moment development of apps that can be quickly put into the field
– FeedHenry in particular strongly suggests that in today’s dynamic and in the moment world many mobile apps should be “disposable” – that is, they can be built quickly and at very low cost to serve specific needs that are likely to be short lived in nature
I think that paints the right picture.
I and my Blue Hill mobile analyst colleagues are all of a mind that MBaaS is the necessary new enterprise mobile app game. There are a number of key vendors in the space – Red Hat/FeedHenry, Kinvey, Pivotal/Xtreme, Appcelerator, AnyPresence and Kidozen key among them – that all enterprises will soon get to know quite well. Those that don’t embrace MBaaS will find themselves at competitive disadvantages.
I am now in the process of researching MBaaS-based enterprise mobile app development. Blue Hill Analyst Insight and Anatomy of Decision reports are in the works and they will go into significant detail on what I’ve only scratched the surface of above.
Before wrapping up I will note that all of the old caveats for mobile app development (at least “old” as of the end of 2013!) still apply. Even in an emerging world of disposable and in the moment mobile app development, mobile strategy remains, as I am extremely fond of claiming, “a long term strategy and never a short term fix.” In truth the more things change the more they remain the same – I’ve also long been extremely fond of noting that the three key business components of any enterprise mobile app project are: rapid development, speed to market and VERY reasonable cost.
I’m thrilled the MBaaS vendors are embracing these concepts. I am even more thrilled that through these MBaaS vendors enterprises will in fact be able to actually deliver on them as well!
MBaaS is the smart enterprise bet to make.
Life at a clearly revitalizing BlackBerry (it’s a work in progress and I can’t quite say that it is “revitalized”) continues to move forward with a certain amount of buzz and interest. Last week BlackBerry not only held what I am going to call a good old-fashioned product announcement in Toronto for the new Passport (more on that in a bit) but also held its quarterly earnings call – this one for fiscal Q2 2015. If you happen to be interested you can catch the call itself or download the press release.
I’m not tempted to go through or to dig particularly deep into anything from the call itself. I find it entirely sufficient to simply say that BlackBerry continues to move ahead with its rebuilding strategy. BlackBerry Executive Chairman and CEO John Chen continued with the same low key and cautiously optimistic approach to BB’s immediate future that I’ve previously noted. The one key takeaway from the quarter’s numbers is that they reflect ongoing albeit slow improvements in recapturing audiences.
For example, BlackBerry’s EZ Pass BES10 migration program (if you are not familiar with the program you can get details from my Q1 2015 BB earnings call post) jumped from 1.2 to 3.4 million licenses, reflecting a gain of 900,000 new customers from the previous quarter. Perhaps more interesting is that 840,000 of those 3.4 million licenses represent conversions from BB’s MDM competitors (e.g. MobileIron, Good Technology).
Further good news on the audience improvement front is the fact that active monthly BBM users now number 95 million. For BlackBerry this is a non-trivial jump of 6 million users from the 85 million reported in the prior quarter.
As well, though BlackBerry has reached out to make several small acquisitions over the last three months the company’s cash on hand has actually improved since the previous quarter by $11 million, and now totals $3.1 billion. This is a sure sign of a righting ship and a real measure of increasing stability. That said the company did note during the earnings call that it may still need to dip its hand into the till before its fiscal 2015 year is out, though BB anticipates that cash on hand will not dip below $2.5 billion.
It is also worth noting that Chen stressed that his management team continues to be focused on improving margins. To underscore this focus he noted as well that BlackBerry turned down several fiscal Q2 2015 deals that would have lowered margins for the quarter. Non-GAAP gross margin reached 47.5 percent, which in turn was driven by positive non-GAAP hardware gross margins.
I have been waiting for some time to hear that some of Chen’s old Sybase buddies had joined the BB team and it is worth noting that one of them -Marty Beard – has indeed taken the leap, and is now serving as the company’s COO. Beard was always a favorite of mine to connect with at Sybase analyst events and before the SAP acquisition of Sybase had headed up Sybase Mobile 365 (which became a Sybase subsidiary by way of its $425 million buy of Mobile 365 back in 2006 – practically ancient history now) as its president. This is in my humble opinion great news for BB’s senior management team.
Fiscal Q2 2015 revenue was $916 million. Non-GAAP loss for the second quarter was only $11 million, or $0.02 per share. GAAP net loss for the second quarter was $207 million, or a $0.39 loss per share. It is interesting to take a quick look at how that revenue materialized globally, which is shown in the chart below.
The approximate revenue breakdown between BB’s key revenue generating groups is as follows:
– 46 percent from hardware (on sales of approximately 2.1 million BlackBerry smartphones)
– 46 percent from services
– 8 percent from software and other revenue
Chen continues to believe that BB will attain break-even cash flow results by the end of fiscal 2015, and is now beginning to entertain thoughts that the company will deliver non-GAAP profitability some time during its fiscal 2016 year. There is in fact absolutely no reason to think this will not prove to be the case. As I’ve noted for some time Chen it not given to overstepping on his predictions – he wants financial expectations to fall within the parameters of under promising and over delivering.
That is as far as I’m willing to go in looking at numbers. Really, as long as nothing of the “standing on the edge of the chasm and peering into the abyss” materializes over the next 6 to 12 months – and I do not anticipate any – it is a good bet to make that BB will see its way to some level of profitability – likely enough to justify real investor interest today.
Other important highlights for the quarter – which I’ve already covered in detail – include BB’s restructuring of its technology platforms and patent portfolio management under the auspices of its new BlackBerry Technology Solutions (BTS) group, and it’s very smart acquisitions of Secusmart and Movirtu. These are all moves that enterprises need to take into strong consideration in evaluating BlackBerry going forward as a legitimate Global 2,000-grade enterprise security (note, I don’t say “device manufacturing”) company.
BTS represents a very positive re-org, and the two acquisitions provide several key new competitive technology differentiators for BB. When you add the addition of Marty Beard to the senior management team as well, we’ve reached my definition of what it means for BlackBerry to be “sure footed.” Chen has driven a very strong series of moves since he’s arrived at BB and I have no qualms in using that “sure footed” descriptor.
Living on Shaky Ground
The problem for BlackBerry alas is that it needs to still tread amongst powerful software competitors at every turn. Those competitors manifest themselves not only in rapidly growing independent entities such as MobileIron and traditional competitors such as Good Technology, but also from the giants – SAP, IBM, VMWare and others.
There are of course the hardware competitors as well, key among them Apple and IBM. The Apple-IBM partnership in particular adds a powerful one-two punch of both Apple hardware and well-integrated and extensive IBM software capabilities to the competitive mix. Further, though I hardly think it will matter from an enterprise perspective Google is of course developing its own enhanced security capabilities to Android, some of which will come from Samsung’s KNOX.
That Apple and Google will continue to dominate is a given. Will they dominate to the extent that BlackBerry will not be able to sell enough hardware to survive as a hardware player? Chen noted during the introduction of the Passport that if BlackBerry can sell 10 million devices on a yearly basis the company can at least break even on hardware.
It is a very sketchy proposition as far as I’m concerned. To begin with the company will have to find extensive numbers of diehard lovers for the new Passport. Chen did note during the earnings call that the company has managed to sell 200,000 devices to date. He also noted that the Passport sold out on BB’s website within 6 hours and sold out within ten hours on Amazon (making it at least for the day that it was released the most popular unlocked smartphone on Amazon). It has a little way to go to catch up to Apple’s opening day weekend sales of the new iPhone 6 and iPhone 6Plus!
I and my colleague and BHR CEO Ralph Rodriguez were both at the Toronto unveiling of the Passport and we are both currently taking deep dives with it. Yes, it certainly is exactly the size of a passport and it certainly has some very appealing capabilities. But am I loving it? That’s a question to be answered in a different blog post.
But I will say a few quick things. As a pure enterprise device it has some very intriguing possibilities, especially as a corporate-liable, corporate-issued device. As a BYOD device – by which I mean can it survive after business hours as a user’s consumer device – I have huge doubts. Downloading Android apps through Amazon is a step in the right direction and there are plenty of possibilities (I was for example able to download the Android version of the Sonos wireless speaker controller and it works beautifully) but was I able to download the essentially universal Kindle reader? You would think I could (its Amazon I’m downloading from!), but alas, no, I cannot.
The Blend software that BlackBerry introduced as a cross- and multi-platform communication capability is quite nice and really well-designed and executed. BES admins will love the granular capabilities it gives them as well. Is it enough to make the transition to the consumer side as a true BYOD device? Hmm…
There are of course diehard BB lovers – quite an extensive collection of them in fact, but are there enough of them to allow BlackBerry to profitably sell devices into the enterprise? I don’t think so. I certainly don’t want to say this but I am not putting my money on devices remaining part of BlackBerry’s future. The Passport will be a purely enterprise device and though there is a “BlackBerry Classic” coming down the road the rest of the year (the “device for the rest of us” as Chen put it) that BB hopes will deliver as a true BYOD device, I doubt there will be traction for it.
This is what leaves BlackBerry with sure feet yet shaky ground to walk on. Having sure feet certainly increases the odds that BlackBerry will survive as a software-based, mobile enterprise security vendor. It will likely survive as a profitable vendor as well.
But that is more than enough at this point to keep BB’s recovery on track.
Finally, in my blog post on BB’s Movirtu acquisition I joked about the Porsche-designed BlackBerry. But I apparently undervalued the reality of the thing! My LinkedIn buddy Frank O’Kelly – one of the true BlackBerry diehards who already covets the Passport and Blend – pointed out to me that in 2012 Harrods of London sold an astounding 130,000 of them at about £2,000 a pop – that’s £260 million. –
Harrods claims that the Porsche BlackBerry is the highest-selling luxury item they’ve ever had in the store. Chen noted during the Passport launch that a lot of “wealthy people are buying them up” – and this includes the newly designed version I kidded about. So then, a Porsche-designed device selling for $599 unlocked should do the trick!
In response to IBM and Apple’s announcement that IBM will be Apple’s strategic global partner for enterprise mobility services, Blue Hill Research has identified the key questions that you need to think about as you consider the implications of this massive partnership. These key questions will be presented in a series of blog posts, and will provide insight on what you need to know, especially if you are considering having your organization partner with IBM on its planned mobile initiatives. [Read parts one, two, three and four of the series]
In this blog post we would like to tackle our fifth and final question: What questions do IBM and Apple have to answer to make this partnership work?
Because this partnership is still in its early stages, IBM and Apple still have a number of questions to answer about this partnership. For instance:
How will IBM’s full mobile portfolio be integrated with Apple?
IBM has invested billions of dollars in Trusteer’s security, Xtify for mobile messaging and marketing, Emptoris (including Rivermine) for expense management and procurement, MaaS360 by Fiberlink for mobile device management, Urban Code and Worklight for application development, The Now Factory and Tealeaf for customer analytics, and IBM’s own internal mobile services and consulting capabilities. IBM has provided guidance for a number of these solutions, but IBM could potentially go even further into providing additional enterprise mobility services for the iPhone to make vertical-specific application development easier and more secure, bring wireless expense management to all iPhone customers, and provide embedded customer analytics for all IBM-based iOS apps. The potential for this partnership is deep (imagine IBM as the Google-like brain behind Apple’s massive App Store).
Will Apple allow MaaS360 to get its hooks into iOS to the same extent that Blackberry can be configured and managed?
One of Blackberry’s great strengths is in the configurability of the platform for enterprise compliance, an area that Samsung KNOX is starting to approach as well. In contrast, Apple has traditionally been standoff-ish in providing access to iOS, even with the enterprise Continuity and Handoff improvements in iOS 8. If MaaS360 can gain preferred status in accessing the iPhone, this would be a huge coup for IBM and a big problem for Samsung, Microsoft, and Blackberry. How much of IBM’s Big Data and Analytics will actually be provided in this offering? IBM has been quiet around the integration of Cognos, SPSS, OpenPages, and Algorithmics, and Watson into the iPhone, but the potential is obvious. IBM has already launched an Analytic Answers service that allows customers to access SPSS predictive analytics just by uploading data and downloading results. Their Watson Analytics tools, which were previously highlighted by analyst James Haight, are directly competing against other easy-to-user analytics tools targeted at line of business analysts. And, as anyone who has watched Jeopardy is aware, Watson is a formidable technology that currently needs help in gaining market use cases and market share. The Apple partnership could help with all of these areas, especially if IBM can share its Watson APIs with the vast Apple developer community.
Will Apple iCloud play nice with IBM’s Cloud? Where will the content, applications, and data ultimately be stored?
Although the short-term strategy will be business as usual, the long-term strategy for these cloud services needs to be determined. Since mobile and cloud go hand-in-hand and the IBM/Apple partnership is predicated on providing an integrated mobile cloud, the cloud strategy needs to be made clear to potential customers. Corporate entities exploring an IBM/Apple enterprise cloud solution need to conduct their due diligence on this partnership’s plans for ongoing cloud interoperability.
Which companies are most challenged by this announcement?
As pointed out before, this is more than just a mobility announcement. On the handset side, Samsung, Google, and Blackberry are obviously paying attention. And on the enterprise mobility management side, VMWare, Citrix, MobileIron, Good Technology, and Apperian have to be thinking about their cloud and mobile application partnership options as well.
But the depth of this partnership means that cloud companies and even application platform as a service vendors need to look closely at this. Every cloud infrastructure company needs to think about how well they play with mobile devices and how they are partnered with key mobile endpoint and management vendors. Likewise, on the PaaS side, Salesforce’s Heroku, Pivotal, and Centurylink’s AppFog need to all reconsider the depth of their mobile application development in light of IBM’s and Apple’s special relationship.
These five posts describe the key questions that we see in the IBM/Apple enterprise mobility partnership. Please keep these points in mind as you decide how to work with IBM and Apple to support your enterprise mobility deployment. If you have any additional questions regarding IBM and Apple or would like for Blue Hill to provide greater strategic context to your mobility deployment, please email us and schedule a time to speak.