The appliance of digital science to your future

Apr 22 2010 by John Hill, The Journal

With around 40 million iPhone users currently tapping screens around the world, John Hill discovers how developers in the North East feel about the opportunities offered by the popular device.

WHEN Apple software engineer Gray Powell left his prototype iPhone 4G in a bar, he didn’t have any shortage of people telling him where he’d lost it.

Tech website Gizmodo paid a reported £3,225 for the retrieved prototype, and the resulting story has been all over the web. Mistake or not, that’s interest in your product that most manufacturers would kill for.

Apple revealed this week that it sold 8.75 million iPhones for the three months up to March 27, 131% up from the same period last year. These sales helped the company to a net quarterly profit of £1.998bn, up from £1.05bn in 2009.

With a potential market of around 40 million iPhone owners, some businesses are looking to explore this opportunity to reach customers.

Tesco has launched an app which turns the iPhone into a virtual clubcard, and grocery retailer Ocado reported that its app generated £15m in revenue since February this year, 4.4% of its total orders.

Steve Grainger, MD of Quayside-based digital development agency Enigma Interactive, said: “It’s a perfect example of the sort of app that will take off if it works well.

“If you go to work on the Metro, it’s an ideal time to be doing your shopping. It fits in with people’s lifestyles.

“What you probably won’t do is fashion buying because it’s more of a pleasure purchase. The convenience isn’t a motivating factor.”

Enigma has bases in Newcastle and London and employs around 25 staff. It says that around 95% of its work is still web-based. Mr Grainger is also on the Codeworks panel for mobile development. He said: “The app and mobile side is where the internet was about 10 years ago.

“You can see the potential, but you don’t have the bottom-line figures to go with it. There’s a lot less actual demand than there is perceived demand.”

That said, he believes that there are opportunities for North East developers: “The North East has quite a lot of quite innovative but often quite small developers, and so it’s a great opportunity to get to market.

“If you want to develop a game for the Xbox or PS3, the budgets are around £1m. You can get away with budgets on the iPhone of about £20k to £30k, with three or four guys developing for three months.

“However, the commercial standard is moving towards the publisher’s standard at a hell of a rate. How long the window of opportunity is open for, I don’t know.”