Demystifying the buzz word 'Apps' - Views on News from Equitymaster

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Demystifying the buzz word 'Apps'

Apr 13, 2011

In this era of information technology, you may have come across words like Apple Apps store, Smartphone Apps, Google Apps, etc. And would have wondered what exactly this word "Apps" means! App is nothing but simply an abbreviation for application. It is used to refer application software. Application software is a computer program which helps the user to perform one or more tasks on computer, or phone, or internet or some other electronic device. This means that much of the office software, media players, the graphic software, that we all use so frequently, are basically apps.

Application software can be classified in many ways. On the basis of utility, there are business application software like Microsoft Office, OpenOffice.org; Product engineering software like computer aided design (CAD) software etc. Application software can also be categorized on the basis of the platforms.

The word "Apps" is a popular term in case of mobile phones as well. The number of mobile apps downloaded is increasing at a fast clip. According to Gartner, the global information technology research and advisory firm, worldwide mobile application store downloads are forecast to reach 17.7 billion downloads in 2011. By the end of 2014, Gartner forecast over 185 billion applications will have been downloaded from mobile app stores, since the launch of the first one in July 2008.

So it does not come as a surprise that top mobile phone manufacturers as well as network operators are increasingly outsourcing work that requires software vendors to write and/or develop mobile apps. So much so that worldwide mobile application revenues are projected to surpass US$ 15.1 bn in 2011, as per Gartner. This is a whopping 190 % increase from 2010 level of US$ 5.2 billion. Therefore, there is a huge opportunity for software vendors in the area of mobile applications. The revenue share for the vendor from a mobile app could be as high as 70%.

In India, there exists an intense competition in this space. Everyone wants a piece of this extremely lucrative pie. Most major software companies like Infosys , TCS, Wipro, HCL Technologies etc. have their own offerings of mobile applications that are available on various mobile technology platforms. There are mid-sized players as well like OnMobile, Persistent Systems etc who have the capabilities. However, to make it big in this area, focus has to be placed on product innovativeness. For example, OnMobile offers the software for the ever popular "Ring back tones" for mobile service operators. Therefore, to effectively compete it is essential to focus on research and development. The effectiveness of the product is determined more by the end user experience. As a result, there is no set way of deciding whether a new idea would work or not. Nevertheless, players continue to innovate and come out with new ideas. And only those who do, have an edge over their rivals.

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1 Responses to "Demystifying the buzz word 'Apps'"

jayvanthy

Apr 14, 2011

Keep up the good work

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Equitymaster requests your view! Post a comment on "Demystifying the buzz word 'Apps'". Click here!

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