Post-Globo: Is it time to have a rethink over the enterprise mobile industry?

James is editor in chief of TechForge Media, with a passion for how technologies influence business and several Mobile World Congress events under his belt. James has interviewed a variety of leading figures in his career, from former Mafia boss Michael Franzese, to Steve Wozniak, and Jean Michel Jarre. James can be found tweeting at @James_T_Bourne.

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The unfortunate story of Globo, the Greek enterprise mobile software provider, is one which has the potential to raise serious alarms over the enterprise mobile industry. Yet if you glanced through the regular industry press, it barely caused a ripple.

The full saga makes for sorry reading. From the accusations by the US hedge fund Quintessential Capital Group of impropriety, to the extraordinary – in every sense of the word – board meeting in which Globo’s CEO, Costis Papadimitrakopoulos, admitted to what was described as “falsification of data and the misrepresentation of the company’s financial situation”, and eventually to administration, Globo’s demise was covered in chapter and verse by the business and financial press. Technology, aside from a few mentions, not so much. But there are major ramifications for the industry in which the company played.

Nick McQuire, VP enterprise at analyst firm CCS Insight, pulls no punches in his analysis. “I think it’s a disaster for the space,” he tells Enterprise AppsTech. “There’s a lot of cowboys, [and] this sort of stuff is I think really not a good thing for the overall industry. There’s a lot of companies out there that are working hard to get mindshare with the customer, reputable, hard working organisations, and then you’ve got companies in this situation, who in my opinion bring the market down. I feel awful for the hardworking employees in Globo caught unaware,” he adds.

Globo is just the icing on the cake for what has been an increasingly cautious market

Before the events of last month, Globo’s reputation was on an upward trajectory, and impressively so given its mostly European heritage and given the heart of the mobility industry – and its media – is US-based. In June, the company was recognised by Gartner as a ‘niche player’ in its enterprise mobility management (EMM) Magic Quadrant for the second year running. In a document seen by this publication, the company stated at the time of the MQ’s release: “We are confident that by next year we will have strong brand recognition in the US.”

Those words may seem unfortunate now, but the reality is Globo was already beginning to make headway in the States, as Maribel Lopez, founder of US-based analyst firm Lopez Research explains. This is interesting considering the EMM market has been traditionally dominated by three companies; AirWatch, acquired by VMware in 2014, MobileIron, which filed for IPO later that year, and Good Technology, which had plans of its own to go public before being bought by BlackBerry earlier this year.

Don’t rail against the establishment

As an industry matures, it naturally gains the attention of larger players. The aforementioned VMware, whose moves into mobility and identity have been well documented even outside of AirWatch, and Microsoft, with its Enterprise Mobility Suite (EMS) among other developments, are a case in point. But will the Globo revelations make organisations looking to roll out mobility solutions look to the more established players?

McQuire expects so. “I think it will generate more caution, and I also think it will focus minds on looking at the players who are going to be around for a while,” he says. “People are going to be much more cautious now – but I think they already were cautious. As evidenced by some of the recent quarters of the leaders, growth is slowing down in EMM. I think Globo is just the icing on the cake for what has been an increasingly cautious market.”

It’s just hard to make money in mobile – it’s extremely important but no-one wants to pay for anything related to it

Mary Brittain-White, the CEO of field operations app provider Retriever Communications, argues ‘the market is waiting on a clear winner.’ “Traditional vendors such as SAP, IBM and Oracle have been found wanting and innovative solutions are in smaller vendors are seen as intrinsically risky,” she explains.

For Lopez, it’s a slightly different take. “While an accounting scandal is always surprising and unfortunate, I think it speaks to a bigger issue with mobility,” she tells Enterprise AppsTech. “It’s just hard to make money in mobile – it’s extremely important but no-one wants to pay for anything related to it. Companies want the mobile versions of the enterprise app for free, and they want to pay as little as possible for mobile middleware and management.”

Caution and complexity – and a big decision for the CIO

Not only will CIOs be more cautious, they will become more confused at the complexity of the industry. Ovum’s EMM rankings, published this time last year, outlined six features to an integrated EMM solution; mobile device management, mobile app management, telecoms expense management, identity and access management, network access control, and a mobile application development platform – the latter of which being a speciality of Globo.

“It’s just a mess,” McQuire admits. “There are over 300 suppliers selling some level of enterprise mobility software to the market. This is not just about EMM, where we tend to think of it as small because it’s consolidating, but there’s all the adjacent technologies that go around it.”

He adds: “I think when companies are doing this now, particularly in larger companies, this is an opportunity for them to really shine in the business. It can really have an impact on a CIO, mobility, or IT manager’s career trajectory. They want to make the right technology decisions.”

The problem however, as this reporter has heard on multiple occasions, is the right path is not always taken – and with potentially damaging results for both the business and the executive involved in making it. These decisions are not being taken lightly, either. A recent survey from Colt revealed CIOs and senior IT leaders across Europe are feeling greater personal risk when making big decisions. Three quarters of respondents said their careers were defined by big moments in a business calendar rather than day to day duties.

The market is waiting on a clear winner – traditional vendors have been found wanting and innovative solutions in smaller vendors are seen as intrinsically risky

Brittain-White notes: “One of the greatest inhibitors for the enterprise mobility industry is that CIOs are unsure of the stability of their selected vendor or product. The demise of Globo fuels this fire of uncertainty.”

She advocates four tenets for companies to ensure they don’t get stuck. Speak to current customers of the potential vendor at the end user level and support staff as “decision makers are often too far divorced from the reality of everyday usage”; ensure source code is in escrow – placed in the hands of a third party for safekeeping – so if things turn sour you can move away without too much pressure; meet the owners of the company; and “scepticism can be healthy” over growth claims.

Moving on

If anything is to be learned, it is to act with caution, suspect pretty much everything, and ignore the grandstanding as much as possible.

“A lot of [vendors] look the same, there’s a lot of overlapping features between various different technologies, everyone says they’re a platform, and frankly a lot of these guys don’t have a lot of time,” argues McQuire, again citing the complexity for the CIO. “Companies will have spent time looking at Globo amongst the other EMM suppliers. I think time wasting looking across so many firms is a real pain for companies.

“I think the market is way overhyped,” he adds. “Penetration of EMM is, in the broad scheme of things, the employee base, still very low. I think companies want to expand their deployments, but they’re facing a lot of challenges in doing that.” Lopez’s prediction intimates more is to come. “It’s a tricky market,” she warns. “I expect many mobile vendors to fold or get acquired over the next seven months.”

Globo did not reply to Enterprise AppsTech’s request for comment at the time of publication.

 

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