By Julian Ferguson | May 15 2020
The future of software development is driven by greater digitisation
One thing we can be sure about when talking about the future of software development is that there will be a future. That said it will look very different from how it is today. According to IDC it took around 40 years to create the first 500 million apps but only 4 years to develop the next 500 million. Whilst predictions vary few question the inexorable rise of the internet. Internet users are expected to at least double by 2025 and use of AI, blockchain and deep learning are expected to become more widespread. All very exciting if you are interested in IT innovation but what difference is all this going to make to business?
Increasing digitisation means lower cost of entry and greater speed to market
According to Huffington Post it cost $5 million to start a tech company in 2000, by 2011 it was $5,000 and today it is around $2,000. Thanks largely to digitisation, any student with a bright idea and sufficient drive can start a business. This was simply not the case 10 years ago.
Digitisation will increase in importance as a means for businesses to deliver new products and services more quickly and at lower cost. Last year India has set a target of achieving a $1 trillion digital opportunity by 2025. The report, India’s Trillion Dollar Digital Opportunity, was released by the Ministry of Electronics and Information Technology (MeitY) done in collaboration with McKinsey & Company. While India’s digital economy currently stands at around $200 million, the report states that the move from the “business-as-usual” onto the digital trajectory would create economic value of anywhere between $500 billion to $650 billion by 2025 towards the full potential scenario where the digital economy can create economic value of $1 trillion by 2025.
A study by IDC for Microsoft in 2018 predicted that the digital economy would make up 60% of APACs GDP by 2021 worth some $1.16 trillion. At the time the digital economy contributed 6%. We suspect this prediction will prove to have been wildly optimistic, especially given the impact of COVID 19 but for us the direction of travel is more significant than the absolute number.
We would be the first to admit that technology as a sector has a bit of a reputation for believing that more or less everything is technology dependent. At Elastic Mint we like to think we are more grounded in the real world than most. As companies look to rebuild their balance sheets post COVID 19, expenditure will be under more scrutiny than ever.
If businesses aren’t already asking themselves where they would be without the contribution made by their digital offerings at a financial, customer engagement and business operations level they probably should be.