Amazon, Walmart buy mobile firms to get talent, technology
E-businesses lack the funding they need to build mobile services, integrate mobile services with their backend infrastructure and build out teams with the right skills in-house, according to a recent study by Forrester Research.
More than half of e-businesses spend less than $500,000 annually on their mobile services, and less than one-quarter spend more than $1 million, according to a survey of 53,400 North American e-businesses by Forrester.
"Spending at these levels mostly takes existing services developed for a PC experience and migrates them to the mobile phone's small screen. It doesn't allow for developing specifically for the unique use cases on mobile phones," wrote in a blog.
From a technology standpoint, 40 percent of e-business professionals are building applications in-house, with 12 percent licensing a platform to do so. At the same time, 62 percent are building mobile websites in-house, with 46 percent relying on their IT team directly. And 68 percent have native applications, far more than are using hybrid applications, Forrester found.
Mobile spending is shifting from front-end services to back-end infrastructure to build web services and get access to real-time data. Specialist skills are emerging, and the required breadth of skills is expanding, Ask explained.
The Forrester analyst cited a number of acquisitions by eBay, Amazon (NASDAQ: AMZN) and Walmart that were motivated in part by the need to acquire mobile talent, technology and services: eBay acquired WHERE for $135 million, Milo.com for $75 million, Zong for $240 million, as well as RedLaser, Fig Card, and Critical Path for undisclosed sums; Amazon acquired SnapTell and Lexcycle; and Walmart acquired Small Society, Kosmix, OneRiot, and Grabble to build out its mobile commerce capabilities.
"Many eBusiness professionals aren't stressing about mobile ... for the most part, they have been able to catch up in a matter of months with a few hundred thousand dollars once they decided to 'go.' A few years from now, it will take millions, if not tens of millions, and years to catch up--if they can," Ask concluded.
- read Ask's blog