The digital goldrush?

By Anthony Doesburg

There's big money in apps - the little programs that transform smartphones and other mobile devices. Anthony Doesburg meets some of the Kiwi software developers working to cash in.

Photo / Thinkstock
Photo / Thinkstock

Some people are calling it a goldrush. Others say the only thing stopping them from hitting paydirt is a shortage of labour.

And although there's a global frenzy, locals caught up in it say there will be plenty of loot to go around for years to come.

The commodity causing all the hype is apps - the pint-size computer programs that turn smartphones and tablets into everything from games consoles to heart-rate monitors.

Apps - many developed here - let users of Apple iOS or Android mobile devices do everything from banking on the move to creating a virtual oil painting. One local iOS app will even tell your fortune.

Colossal fortunes are apparently being made. In October, the New York Times reported that Finnish developer Supercell was making US$500,000 (NZ$601,000) a day through Apple's iTunes App Store from its Clash of Clans and Hay Day game apps. Income like that is exciting local developers, who aren't put off by the 700,000-plus apps already in the store.

For all the hype, though, no one can say how big the New Zealand app development market is. Apple, which strictly controls the apps it allows into its store - and pockets 30 per cent of all sales - won't say how many registered Kiwi developers there are.

The New Zealand Software Association can rattle off names of a few companies in the app business - Sush Mobile, Cactuslab, Bluespark, Carnival Labs - but doesn't report a sudden influx of new app developer members.

IT market analyst IDC studies the various mobile device "ecosystems" - Apple iOS, Android, Blackberry, Windows - from a global perspective, but has no local market insights to offer.

The best guess, based on iOS meet-ups organised by Auckland developer Cactuslab and attendee numbers at Devmob, a conference in November on Auckland's North Shore, is that there are 100 to 200 New Zealand app developers.

Cactuslab co-founder Karl von Randow says about a dozen companies - including his - "make a lot of noise" about app development, and many others are either creating apps in-house or are small operators.

If noise translates into a few million dollars in sales, the busiest dozen companies could be turning over $50 million, and the rest the same again, to give a total market size of, perhaps, $100 million.

Kaiparasoft, a Kumeu company which hasn't shown up on either the Software Association or Cactuslab radar, is a local app development star. It released a game in the iTunes store in November that has been in the top 20 in the United States market since and the company looks set to more than double last year's revenue of $5 million.

Director Chris Harris says Kaiparasoft's success is proof that writing games apps is a legitimate career choice.

"It's moving so fast that we can't wait five or 10 years for people to come round to the idea that it's a viable way to make a living.

"The livings are being made now; the goldrush is on now."

MEA Mobile is at least as bullish as Kaiparasoft.

Director Rod Macfarlane says a skills shortage is the problem.

"A big issue for us is finding new talent, so we've recently launched a new education institute called App School, a joint venture with Prima Group, which is part of Wintec [the Waikato Institute of Technology].

"There's no shortage of opportunity in this market. The amazing thing is, the mobile industry represents 2 per cent of global GDP - it's massive and it's only getting bigger, at a phenomenal rate."

And don't let it be said that playing computer games doesn't prepare you for the real world. Kaiparasoft's Harris says lifelong gamers are precisely the people he looks for when hiring.

In app development, if you strike it lucky, it's all fun and games.


App creation very much a young man's world

If your mental picture of an app creator is a young male maverick with personal hygiene issues, you're probably at least partly right.

United States company Appcelerator and IT market analyst IDC have sketched an app developer profile based on a survey in August of 5500 users of Titanium, Appcelerator's programming tool. Ninety-six per cent of survey respondents were male, 40 per cent were in their 20s and nearly 80 per cent under 40.

The questionnaire apparently didn't probe their showering frequency, so the truth or otherwise of the popular belief that geeks get so wrapped up in their work that they forget to wash is untested.

The survey does suggest, however, that mobile developers want to change the world.

They like "to know it first and know it best", but not for the sake of climbing the corporate ladder - getting promoted and impressing the boss isn't particularly important to them.

On the other hand, pride in their work, freedom of speech, and the environment all matter.

And what really fires them up is fighting corruption and ending poverty and corporate greed.

The iOS platform used by Apple's iPad, iPhone and iPod touch was more popular with respondents than the rival Android operating system.

Auckland app developer John Ballinger, who is 35 and like a third of the survey respondents is self-employed, thinks the profile is "over the top".

He is more turned on by the opportunities presented by Apple's clever gadgets than by attacking the company's bulging coffers.

- NZ Herald

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