“I already worked from home, I’m into different internet marketing companies and I’d done a bit of programming before,” he says. “I hadn’t done any Apple programming before, and I figured I could learn it quite easily.”
Yates says that his $6 card-counting app recorded 1650 downloads on its best day, netting him $10,000 of which he would have received about $7000.
“There was talk of money to be made, and I already did some stuff at home and thought I could try it,” Yates says. “That was the main reason I started.”
Keith Ahern, chief executive of development studio MoGeneration, designed applications for News Limited before entering the industry for himself.
“Basically I liked working with the iPhone so much that I left and formed MoGeneration and picked my own team with some contractors,” he says.
MoGeneration has created applications across a range of genres, but its most popular is a game designed for children called “MooShake”. The $1.19 app reached the number two spot for kids’ games on the Australian App Store, and managed to reach number four on the US charts.
But it is not just money that makes the App Store platform so attractive to programming entrepreneurs.
Dawson says another attraction is the fact developers can avoid huge advertising and marketing budgets. “If you’re fortunate enough to rank highly, you don’t have to do your marketing.”
Another reason is that the iPhone itself is opening up new possibilities in the mobile sector. The iPhone’s touch screen, simple user interface and easy-to-use software makes it easy to develop simple and practical everyday applications.
Ahern says that the iPhone’s new 3.0 operating system, due for release in the middle of the year, could lead to new boom for applications as developers will be able to add new features to their applications.
“One big thing is push alerts. Apple has finally made available a system that tells the phone when there is something interesting happening, and the user sees a pop-up that they can push it and launch the app.”
He says the other big breakthrough is the ability for developers to sell other features or products within existing applications.
“Until now, apps are either free or it’s a once-off price. Apple hasn’t had a good model for that, but now there’s in-application commerce. That’s going to mean a lot more services and content are going to be available.”
Ahern says that while the iPhone’s limitations have made some applications unfeasible, the new update will allow him to do “basically anything they ask”.
Steve Fawkner of gaming developing group Infinite Interactive also predicts the App Stores will become an even bigger platform for gaming companies. He says developers will even look at bringing old, out-dated games to a new format.
“It’s certainly built for gaming. The number of small iPhone developers coming out tell me the iPhone game market is going to grow,” he says.
But while the App Store has created an entire community and industry around the creation and marketing of these programs, developers say the store’s life expectancy in its current format is short.
Ahern says the sheer size of the App Store means developers are becoming lost. “There are too many applications now. Apple are a victim of their own success – they’ve created their own information management problem.”
Ovum analyst Nathan Burley agrees. “That’s a problem with the internet isn’t it – how do people find content that’s relevant? It’s like any other website.”
Graham Dawson is more blunt. “I can’t see the existing model surviving; it will have to change,” he says.
“The apps that receive the most downloads are the most visible. Given people buy cheaper apps rather than the most expensive, developers have pressure to put prices down.”
Dawson says this means developers then give in to creating cheap, novelty applications that sell well but lack the kind of usability and practicability a high-end business application offers.
“If they change the system so that it doesn’t reward the volume of applications sold, and bias it towards higher prices, then you’d find the higher quality apps would go towards the top of the rankings.”
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
