The Apple enterprise app store conundrum

The iOS App Store, introduced in 2008, revolutionized the entire process of buying and installing software on mobile devices, and has since been replicated across every major mobile platform. It's even come to personal computers, first with the Mac App store, and soon with Microsoft's Windows Store for Windows 8-style apps.

But Apple's consumer-focused approach to apps creates challenges for iPhones and iPads in education and business environments. The App Store works great for individual users, but it doesn't work well for enterprises.

The problem is that the entire App Store sales model was built on the sale of songs, not for the traditional licensing of software. A song bought by a user is connected to and paid through a user's iTunes account. It is designed to be played on that user's computer, iPod, iOS device, Apple TV, or burned to a CD. It is a user-centered paradigm. That paradigm applied to iOS apps means that every app is associated with a user's iTunes account (a.k.a. Apple ID) and may be installed and run only on devices associated with that user's account.

Enterprise software purchases are very different. The value in any piece of software isn't found in the application itself. It's found in the legal right to install and run that application (a.k.a. the software license). When businesses purchase software like Microsoft's Office or Adobe's Creative Suite, they buy the right (licenses) to install and use that software either on a specific number of PCs, for a specific number or users, or for everyone across an organization. This volume or site license process is how business, schools, and every other organization has purchased and used software for decades. In virtually all cases, the license is not linked to a specific individual and his or her PCs or other devices.

This creates an inherent disconnect when it comes to iPhones and iPads in the workplace. Users can purchase apps for business use, but they are still associated with their Apple ID and can run only on their devices. Businesses can reimburse users for the expense, but the ability to use the app remains with the employee. If he or she leaves the company, the app leaves as well.

Apple tried to refine the situation with its Volume Purchase Program (VPP), which is available for both businesses and schools. The program allows a business to make bulk purchases of apps. Apple delivers the right to download and install the app to enterprise customers as a spreadsheet of App Store redemption codes - the same type of codes imprinted on iTunes Store gift cards or delivered when you gift a song or app to someone. To distribute apps, an organization can simply email those codes to users. When users redeem them on their devices or through iTunes, they gain access to the app for download and installation on their iOS devices without needing to pay for it.

That would be a workable solution, except that there's a catch. When a user redeems a VPP code, the app becomes associated with his or her iTunes account in the same manner as if the user had bought the app or received as a gift - meaning it leaves the organization with the user just as if the user had bought it.

This creates a problem for app licensing, distribution, and management - not to mention budgeting and reconciling of expenses. It's a problem that has yet to be truly solved in  BYOD (bring your own device) programs as much as in situations where users are issued corporate or school owned iOS devices.

That problem is likely to get bigger over the coming months and years. Mobile app management (MAM) is becoming one of the most crucial mobile management and security techniques, particularly where mobile management suites with MAM capabilities are used to deliver apps directly to managed devices.

At the same time, the enterprise app store concept is becoming a major component of enterprise mobility. An enterprise app store is company-developed app marketplace for employees that includes internally designed apps for specific tasks and processes alongside a curated selection of public apps from Apple's App Store (or Google Play or BlackBerry App World) for employee use. The volume/site license model of traditional software purchasing underlies much of the enterprise app store concept - placing it somewhat at odds with Apple's VPP approach.

Canalys senior analyst Tim Shepherd, speaking at this week's AppsWorld Europe exhibition in London, noted that enterprise app stores are a growing model and may be the future of mobile app distribution in the workplace saying that "enterprise app stores are really starting to come through, and is a reality for what CIOs are now looking at when deploying custom apps for their employees."

He also addressed the Apple enterprise app dilemma specifically.

“Clearly with the Volume Purchasing Program, Apple has been trying to work with selected partners. But I expect to Apple to move in the direction of offering a custom App Store for enterprise. On one hand that would allow enterprise to upload custom app, while employees would also be able to download their own consumer apps for the App Store."

The idea is certainly intriguing and there is some evidence to back it up.

When it introduce the VPP, Apple also rolled out an Apple Configurator utility that can be used to deploy and manage iOS devices - either alone or in conjunction with other mobile management solutions. When a device is configured/deployed, organizations can install VPP-purchased apps using the spreadsheet of redemption codes from Apple. Those apps are installed and available to users, but are tied to the device itself and not the Apple ID of the device's user. Even better, if the device is removed from service within a company and wiped through Apple Configurator, the redemption code/license for apps can be reclaimed and reused for other devices.

Apple has also begun to acknowledge that business and enterprise customers may need more flexibility when it comes to app management and enterprise app stores. In particular, Apple has developed a program for business-to-business app development and deployment. The mechanism isn't perfect and it requires apps to still have App Store review for distribution - an issue not faced for purely internal enterprise apps. It is, however, a sign that Apple realizes the challenges that its enterprise customers are facing.

Does this mean that Apple is likely to deliver a truly enterprise-oriented app purchase and distribution mechanism? That's hard to say. Apple cedes certain capabilities to third party mobile management vendors, but still retains a lot of power and income (after all, 30% of any App Store purchase goes to Apple) over the iOS app ecosystem.

iOS 6 didn't really expand any app management or licensing capabilities. It did, however, expand the role of Apple Configurator. Roughly half of the new mobile management policy options in iOS 6 are tied to Apple Configurator's Supervise mode. Future updates could turn Apple Configurator into an enterprise app management solution. Where that would leave third party mobile management vendors in the equation is anybody's guess, though several vendors have integrated Apple Configurator in their device enrollment processes.

It is conceivable that this could serve as the basis to the hybrid App Store that Shepherd envisions.

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