App Mania

by JT McGee

Apps.

That word has so much power. It’s incredible.

VCs apparently fall over flat for it. Phone users adore it. Tablet users are just getting used to it. And a small minority makes billions from it.

Apps vs. Car Mechanics

The surge in “apps” for mobile devices isn’t all that different from traditional brick and mortar businesses. A multi-billion dollar business (General Motors) made my car. A small time business owner changes its oil and makes every repair.

Apple makes the iPhone – and 16 year old kids design apps to make it better. Same thing goes for any of the many Android devices.

I recently downloaded a free app to turn my phone on silent for a set period of time. Switch the volume down and a popup appears. I’m asked when I want to turn the ringer back on, and can choose a range from 15 minutes to 12 hours.

Never do I forget to turn the volume back on when I leave movie theaters, the classroom, or for my choice periods of peace and quiet. It really is a phenomenal tool, a feature neither Apple nor Google have yet to add to their devices. There’s no need – an army of developers yearns for the opportunity to make apps to perfect mobile devices.

App Downloads iOS vs Android Chart from BusinessInsider

1 Billion Served…Per Month

Apple’s App Store reportedly generates 1 billion app downloads per month. That’s an incredible number.

The App Store debuted on July 10, 2008 and has since delivered 18 billion downloads. If the current pace is in fact 1 billion apps per month, Apple will serve up more apps in the next year than it did in the first three and a half. Steve Jobs is a champ.

Makin’ Bank

Zynga IPO’d last week at a pricetag of $7 billion for the firm. That’s half the current valuation of videogame giant Activision, and more than EA, which makes hundreds of popular gaming titles.

But Zynga doesn’t even sell games for traditional gaming consoles. It sells online games. Actually – even that’s a lie; it sells cool things inside online games. The company makes generates almost all revenues from 3% of people who actually pay for in-game content.

According to one article, Zynga doesn’t make it cheap to pay your way through. Not a single Zynga game can be beaten with purchases without spending at least $75,000. Who said we had an internet bubble?

Yep, it’ll take $75,000 to show your Facebook friends who’s the boss on Mafia Wars. You tell ‘em, tiger!

Apparently some users spent $50,000 on Mafia Wars “upgrades” in 2009. That’s a single player in a single Zynga game. At least the buyers were frugal about their purchases – buyers made big buys on Black Friday of all days.

Silicon Valley Brain Drain

Silicon Valley should displace Wall Street as a single source of the worst brain drain. Top computer science scholars and graduating engineers are going to work for Zynga, where they design entertainment products to keep the public fixated on back-lit LCD screens.

Obviously the case can be made that this brainpower is indeed wasted. Fifty or so years ago the US put a man on the moon. Today, that isn’t even a goal worth pursuing. Launching another hit social media app is far more monetarily rewarding.

Just look at this guy, a recent graduate recruited by a new start-up Scopely:

silicon valley sign-on bonuses

In front of him is part of his sign-on bonus, which includes:

  • $11,000 in bacon-wrapped cash
  • spear gun
  • Year’s supply of Dos Equis
  • An Oil Painting of the new recruit
  • A Fancy Tuxedo
  • Sex panther cologne
  • A humidor of Cuban cigars

Wall Street has to work for bonuses. All of the above are items you get just for signing on to work for Scopely. High frequency trading doesn’t have anything on the evil that are Apps. Sheesh – let’s not get started on computer engineering salaries.

Photo by: ilamont

{ 10 comments… read them below or add one }

Andrea @SoOverDebt December 19, 2011 at 01:38

I thought I knew all of my regrets in life, but I was wrong – I now regret never asking for bacon-wrapped money as a sign-on bonus. I need to go get another real job just so I can mark that off my bucket list.

I’d be lying if I said I didn’t LOVE me some apps. I actually buy and/or use certain products based on whether they have an app. Examples – bank accounts, retirement accounts, my wireless router, and pizza. Oh yes, because calling to place an order is way too inconvenient. This is the world we live in, and people who capitalize on technology are incredibly smart. Assuming they save some of their money instead of spending it all on Dos Equis.

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JT McGee December 19, 2011 at 14:40

Wow. People actually use apps to order pizza?

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Funancials December 19, 2011 at 21:29

Absolutely – I want to say Dominoes has an app that allows you to watch the process of your pizza being made. That way – you can know exactly when the delivery boy will be approaching your door.

I have no idea where you discovered this tech whiz who apparently is worth all that bacon wrapped cash, but I’d love to know.

I remember when Harvard came out with a course on how to develop apps – and it was insanely successful. I wish I knew more about technology so I could enter the app-rush. BraveNewLife occasionally blogs about his app-developing adventures.

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JT McGee December 20, 2011 at 10:03

A friend wouldn’t let me call to order pizza once, so we ordered it online. He had never done it and wanted to give it a whirl. It was a Dominos pizza, and we definitely watched that stupid ticker for the full 25 minutes until the pizza showed up.

Forgot to cite the original article, but here’s another I Googled: http://news.cnet.com/8301-1023_3-57324275-93/work-with-the-cool-kids-culture-is-a-weapon-in-2011s-hiring-battle/

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101 Centavos December 19, 2011 at 08:25

A box of Cuban cigars?! Sign me up, please.

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JT McGee December 19, 2011 at 14:41

I thought the spear gun and $11k cash was the best part. 😉

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PKamp3 December 19, 2011 at 11:59

I feel ripped off – all I got was some lousy stock when I signed on. You can’t eat stock (well, I suppose you can eat paper stock certificates, but I digress…).

Mobile gaming salaries will eventually equalize when more engineers enter that space. In fact, I’ve seen some University Computer Science programs start to split the major into multiple disciplines, one of which is gaming… maybe we’re blowing a gaming bubble, haha?

I do have to say that App development is about more than games. I’ve been on a team for a few ‘serious’ apps, including physical security applications. One of my good buddies is about to launch a location-aware app. It’s not just about the games – although they do sell well, heh.

Here’s a true waste of talent… salaries are higher in the D.C. area than Silicon Valley, for the first time…

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JT McGee December 19, 2011 at 14:43

Pfft, don’t try to justify the wastefulness! If only the American public could “feel” Wall Street like they can an app. Don’t get me started on DC; I’ve already written that whole city off.

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Jeffrey Trull December 19, 2011 at 14:21

Totally agree on the brain drains there. I guess it goes to show what we value as a society, however unfortunate that is.

There’s still hope for middle ground between more Zynga apps and putting someone on the moon. I just think we need to get more money behind that things that matter (somehow).

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JT McGee December 19, 2011 at 14:43

Maybe an app that allows micro-donations to crazy expeditions to mars? It’d be perfect!

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