Enterprise MBaaS Set to Explode in 2014

Mark Boyd, December 20th, 2013

While industry analysts expected this year to be the year Mobile Backend-as-a-Service (MBaaS) took off, end-of-year assessments are suggesting that there is still room for further growth in 2014. Forecasters predict a 104% annual growth in the market to reach $7.7 billion in 2017, while this week’s acquisition of MBaaS vendor StackMob by PayPal has piqued more than a few businesses’ curiosity. Meanwhile, analysts from Forrester and major players like Rich Mendis from AnyPresence believe the MBaaS revolution is still yet to happen for the enterprise.

MBaaS has been a growth sector throughout 2013, as more developers look for ways to manage the pace of demand for mobile app development. Industry analyst Michael Facemire from Forrester Research says in an Industry Insight video that MBaaS aims to solve the “not-so-fun parts of mobile enterprise development.” He points to the wide range of issues that developers must manage when working on mobile apps for enterprise use. “Understanding all the data protocols, understanding the nuances of line of business systems you are trying to mobilize. That part sucks.”

These are the pain points also mentioned by Miko Matsumara from MBaaS vendor Kii Cloud in a guest post on ProgrammableWeb a year ago. He also points to a range of other hurdles developers must face if managing their own backend, including maintaining the pace of mobile app development demands once introduced in an enterprise environment, the learning curve involved in switching from backend to UI contexts, and the stack risks involved in picking the wrong combination of services.

Given these difficulties, many analysts expected 2013 to be a watershed year for MBaaS vendors. An end-of-year assessment by James Staten on Forrester Research says while this was true for individual developers taking up MBaas, he grades enterprise uptake as a C at best. “We still see too many enterprises bypassing the MBaaS and trying to connect the mobile app to their web tier or right back to the back office. This burdens mobile applications unnecessarily and inhibits their agility while potentially pounding the backend as mobile becomes the primary system of engagement,” Staten wrote in his summary blog post last month.

Industry perception of StackMob

Part of the misgivings amongst enterprises taking on MBaaS solutions has played out in the market over the past year. GigaOm reported this week that StackMob had been put “on the block” (for sale) because of having a hard time acquiring funding after it’s $7.5 million venture fund raising in May 2011. That problem has been solved by its’ acquisition (for an undisclosed amount) by Paypal, with the developer team currently packing up and moving from San Francisco to Paypal’s San Jose offices. VentureBeat, in a report on the acquisition, warns current StackMob customers they may need to look for other MBaaS solutions.

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Rich Mendis is CMO and Co-Founder at MBaaS enterprise vendor AnyPresence. He told ProgrammableWeb that part of the reason for MBaaS’s poor rep in the enterprise is due to mixed messaging and, in part, the success of StackMob’s brand awareness, which has confused potential customers in the MBaaS market. “Over the past year, the MBaaS space has segmented into two groups of vendors: Those like StackMob who target individual mobile developers; and vendors like us at AnyPresence, and more recently Kidozen, who are specifically targeting the enterprise.

“After [MBaaS vendor] Parse was sold to Facebook [in April this year], vendors like StackMob and Kinvey pivoted their messaging but not their product. MBaaS isn’t struggling , it’s the freemium model that targeted individual developers that is struggling. Usage based models are not how the enterprise buy. Enterprises need predictable cost structures and independence, that’s the fundamental difference between these two types of vendors and is why we are seeing 6-figure annual subscription deals with our customers,” Mendis said.

AnyPresence and MasterCard: MBaaS in the enterprise

Mendis points to the recent partnership with MasterCard as a case of how enterprise can successfully run MBaaS solutions:

“MasterCard is leveraging AnyPresence to enable their developer ecosystem to build full stack apps using MasterCard APIs … full stack development. You can click on the App Launchpad that MasterCard has recently added in beta version to their developer portal and use a ‘white-label’ version of AnyPresence app generation functionality. The portal helps developers understand how to incorporate the MasterCard API into their full stack development application.” MasterCard provide an open API platform and this new partnership with AnyPresence is aimed at making it easier for developers to integrate MasterCard payment and payment related services into new e-commerce and retail mobile applications.”

Mendis explains:

“MasterCard is using AnyPresence to enhance their developer portal experience, providing developers with a sample app in the browser so they can see how the API is used, and download the sample code including the backend server. MasterCard wants to encourage customers to create server-to-server authentication so they have used AnyPresence to generate a sample app and provide it to developers. This means developers are getting access to a fully-functional sample app and backend server code, which is reducing the hurdles to enterprise mobile app development. So instead of taking a few weeks or a month, it can be done in a few hours or a day.”

AnyPresence empowers enterprise developers to remain in full control of the code that is generated using the service, Mendis says. In the past, this has been a sticking point for MBaas, with one forum member on API Evangelist’s industry roundup commenting “The big problem, IMHO, using a BaaS provider is the so called ‘vendor lock in’. What if my backend provider changes the pricing models, or dismisses the service and go out of the business?” It is a risk that more enterprises will want resolved, especially those thinking through the implications of VentureBeat’s statement about StackMob customers looking for a new service provider.

According to Mendis, AnyPresence has taken on the best parts of open source MBaaS to provide flexibility to developers on their platform: “As a developer, you can stop using AnyPresence at any time and get all the source code and continue running your application yourself.” (AnyPresence is currently introducing new features to the App LaunchPad allowing developers to push full stack application server code to Github and Heroku.)

As demand for mobile apps in the enterprise surges, developers will be looking for easy-to-use, full stack solutions while their C-level counterparts will be looking for proof of trust in MBaaS solutions, and industry-relevant pricing strategies. These three factors may well be at the core of enterprise MBaaS uptake in 2014.

By Mark Boyd. Mark is a freelance writer focusing on how we use technology to connect and interact. He writes regularly about API business models, open data, smart cities, Quantified Self and e-commerce. He can be contacted via email, on Twitter, or on Google+.

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