Emerging Platforms

The B2B App Store: Mobility increasingly evolving towards a strategic business tool

Posted by Scott Michaels on December 2nd, 2011 at 3:28 pm

The B2B Apple App Store program was launched this summer as the tech-giant’s response to growing corporate demands for business applications. The service allows businesses to purchase apps in volume and distribute them within the organization, solving many of the challenges originally posed by Enterprise app deployment.

The B2B App Store acts as a private web portal between buyers and sellers of apps, making it easier for businesses to integrate apps into day-to-day operations. It is also the mechanism to deploy customized applications based on common code or framework logic. This allows the developer to build the app once and make minor modifications, such as branding for each customer, while keeping the “guts” of the application the same. Another benefit for developers is that they retain the IP of the application, unlike most custom application development agreements where the client is essentially buying the IP of the custom developed app.

Apple still does have the Enterprise deployment mechanism for in house applications; however, the B2B App Store allows developers and customers alike to buy and sell apps without the same stipulations of the Enterprise store. Enterprise deployment requires the company to have at least 500 employees, with few granted exceptions. However, the new B2B App Store has no minimum restrictions other than a minimum price point of $9.99, making it possible for businesses of any size to participate. Apple’s only requirement for users of the B2B App Store is that the buyer and seller are both registered. From there, apps can be purchased in volume, distributed to staff, and managed via the very familiar iTunes workflow.

What the minimum price point means for developers is that even though Apple takes their 30% cut of $9.99, developers may create contracts directly with buyers to brand or otherwise customize the app that is outside the purchase of the app from the B2B App Store. Therefore, Apple still gets 30% of $9.99, which is significantly higher than $3.84, the average price of an app in the regular Apple App Store. The B2B App Store fills a previously ignored niche market for high value, low volume applications.

By allowing third-party developers to sell and distribute custom apps for business customers, Apple is spawning a new type of application market that is targeted specifically at enterprise customers, and common needs across a vertical. This lets developers create company and industry specific apps explicitly designed for clients using Apple products.

Applications delivered through the B2B App Store do not need to follow the same guidelines as applied to the traditional App Store. Under new Apple regulations, the mainstream store will no longer accept white label or “cookie cutter” applications. These kinds of apps should be sold through the B2B App Store, since everyday consumers would not typically benefit from them.

For example, a developer who owns code for a boardroom application, previously would have skinned and submitted several boardroom apps, each branded for different institutions, such as Citi Group and BMO. Today these apps would be rejected from the regular App Store. Now the developer can build the boardroom app, submit it to the B2B App Store, and brand it for individual clients who pay him to do so.

Some more examples of applications that would be rejected from the regular App Store, but now find a place and purpose in the B2B App Store:

-       Field sales application to be used by sales reps to inspect inventory, and displays at grocery stores in their territory.

-       Organizations or educational institutions that need to make bulk purchases, such as 10,000 copies of a PDF reader

-       Pharmaceutical app with common features, such as drug information, videos, and photos, which is rebranded for each pharmaceutical company.

Apple’s move into the corporate world along with the new restrictions placed on the mainstream store signal Apple’s maturity over competing app marketplaces, such as Android Marketplace, which does not regulate app submissions at all. While BlackBerry App World does regulate app submissions to its store, both Android Market, and BlackBerry App World’s restrictions on “cookie cutter” apps are much more lenient than Apple’s. In fact BlackBerry App World actively seeks white label apps in an attempt to increase the volume rather than the quality of apps in the store.

Introduction of Apple’s B2B App Store is further indication that mobility is increasingly evolving from consumer entertainment to a strategic business tool.

4 Responses to “The B2B App Store: Mobility increasingly evolving towards a strategic business tool”

  1. Scott,

    Thank you for highlighting the new Apple VPP (Volume Purchase Program) and it's use as a way for companies to get B2B apps distributed. It's fantastic that Apple is providing additional options for companies to get apps for their employees.

    I wanted to clarify a few items in your posting.

    (1) The iOS Developer Enterprise Program is actually open to companies of any size. It's no longer restricted to companies of more than 500 employees. This change was made back in September 2010, and enables organizations of any size to build or have built "custom" iPhone and iPad apps. Development of in-house apps is now available to all organizations. For more information see http://www.apperian.com/tech_notes/apple-ios-enterprise-developer-program-summary/.

    (2) Using the term "App Store" needs to be explained a bit. The VPP Program and it's ability to distribute B2B apps is not a store in the traditional sense -- i.e., there is no public view of the B2B apps provided -- although it does provide a way for companies to directly connect with developers and distribute apps. Companies need to understand how best to use VPP for private receipt of apps, and developers have some steps to go through (e.g., data validation testing) as part of the program. More information is at http://www.apperian.com/apple-vpp-and-custom-b2b-apps-what-does-it-mean-for-developers-and-companies/

    Some additional resources for those interested in the B2B App Store space is available at:

    http://www.apperian.com/demystifying-the-mobile-enterprise-app-store/
    http://www.apperian.com/demystifying-the-mobile-enterprise-app-store-part-2/

    Thanks for covering the evolution of apps from consumer to B2B! It's a very important trend and one we are keenly interested in at Apperian.

    Sincerely,

    Cimarron Buser, VP Product Marketing, Apperian

  2. andy says:

    Thanks. It helped me out figuring out the B2B information for our customer. We were not sure which way to go.

  3. jeff says:

    Great article. Do you know how long it takes to distribute through the B2B app store? I am curious if it is the same as the 3 to 6 weeks in the app store.

  4. Bruce says:

    What distribution model supports truly private app deployment? My company needs to develop and distribute apps for use by Public Safety personnel which would connect to our existing deployed suite of applications at a site. These "apps" could be priced as much as $1000 per device and may need to be updated with an extremely short turnaround (hours). These systems deal with sensitive information and I do not want the IP sitting on some App store server.

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