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Application developers come of age

Source :China Daily          update : 2017-01-09

Chinese talent takes the digital world by storm; giants set to invest big time

When around 2,000 enthusiastic Chinese app-developers gathered for Google Inc's annual conference for their ilk in Beijing in December, they didn't allow sub-zero winter chills to dampen their enthusiasm for the event.

Suitably impressed, Scott Beaumont, president of Google Greater China, told the large audience at the Beijing Google Developer Day, the biggest such event in the Asia-Pacific region, that Google "is here to know what Chinese (app-) developers want".

The rapturous crowd cheered him on.

Its internet search engine may have been out of the Chinese mainland since 2010, but Google, like other global tech giants such as Apple Inc and Microsoft Corp, has ambitious plans for the world's largest mobile internet market.

The California-based giant has launched a Chinese website for local app-developers and promised help to take their products global.

The developments excited Yan Peng, a Shanghai-based app-developer, no end. "Finally, it's here. This is the best Christmas gift for me. I couldn't wait to ask for a day off to celebrate this moment."

Such gushing praise was earlier common among Chinese consumers at the launch of much-awaited gadgets like, say, the latest version of the iPhone. But China is no longer just a humongous end-user market.

Apps developed in China are increasingly popular among domestic and overseas users. For instance, Clean Master, a junk cleaning app, has over 400 million overseas users. Bigo Live, a live streaming app, boasts 7 million monthly active users from Southeast Asian countries, all of whom came on board within three months.

Such developed-in-China apps abound these days. Call China an app-developer hub, if you will.

This new facet of China is not lost on the world's tech giants. "China is now an indispensable part of the global developer community," said Ben Galbraith, head of product and developer relations at Google's developer product group. "Chinese developers are responsive to new technology and known for high efficiency."

The trend started a few years back. In 2014, China nosed ahead of India in terms of software developers. Out of 18.5 million professional and amateur software developers globally, China accounted for 10 percent of them, while India had 9.8 percent, data from International Data Corp, the US IT consultancy, show.

Data on the current scene is yet to emerge, but it is reasonable to assume that the mobile internet boom and China's digitalization push would likely have boosted the app-developer numbers significantly, said Sandy Shen, research director at Gartner Inc, a US-based technology research and advisory company.

Sensing future potential, Apple has decided to set up a research and development center in Shenzhen, Guangdong province, South China, later this year.

The US tech giant's Shenzhen announcement came after it set up its first China R&D center in Beijing in September last year. The work is still on and the total cost is expected to reach 300 million yuan ($44.6 million), and staff 500 employees eventually.

Shenzhen, which is an innovation hub, already houses over 100,000 developers for Apple.

During his May 2015 visit to Beijing, Apple CEO Tim Cook held extensive meetings with local app-developers. Apple has also invested $1 billion last year in Chinese ride-hailing app Didi Chuxing.

"Chinese (app-) developers are already technologically strong, and Apple will offer more help in the marketing side to help them venture into overseas markets," Cook had said.

China remains key to Apple in spite of tumbling iPhone sales. That's because the country beat the US to become the largest market for Apple's iOS app store last year, according to App Annie, an app-tracker.

In the third quarter of 2016, Chinese consumers spent $1.7 billion on the iOS app store, more than five times what they had spent just two years ago, App Annie said in an email.

Encouraged, Apple organized its first-ever app developer competition in China in October last year, to encourage university students to work on apps.

With spending rising and competition intensifying consequently in the domestic market, Chinese app-developers are venturing abroad.

Outbound Chinese app-developers often start with utility apps like cache cleaners, anti-virus offerings and data transfer tools, before testing waters in the content business, which ranges from social media, live streaming and mapping to mobile payment apps. Some have already had a good start, said Wei Fangdan, CEO of BaijingApp, an online community of more than 40,000 domestic app-developers who have global aspirations.

As of January 2016, they developed about 270,000 apps that were sold via Apple's iOS app store. By May-end, the app-developers earned more than $7 billion£­and half of that came in the past 12 months, indicating strong growth momentum.

In the past two years, Chinese gaming and entertainment app-developers saw a 150 percent jump in revenue from the app store Google Play, Google said, without disclosing specific figures.

The United States, Japan and South Korea are the top three overseas markets for Chinese app-developers. Emerging economies such as India, Mexico and Turkey are new growth drivers, data from App Annie show.

Interestingly, Chinese app-developers are graduating to cutting-edge technologies like virtual reality and artificial intelligence.

Perfect World, a Chinese game developer, unveiled its first VR game "Subnautica" in March. The game enables consumers to be immersed in a virtual sea world and play with underwater creatures.

As of June 2016, the PC version of Subnautica generated more than $1 million in monthly sales. The firm is working on mobile VR games.

"There is an abundance of breakthrough innovation coming from China versus 'me too' technology we saw in the past," said Zack Weisfeld, general manager of Microsoft Global Accelerators.

In December, Microsoft said it would launch its mixed-reality headset HoloLens in China this year, so that more local developers can work on apps for the gadget. "We believe China could be leading the world in terms of mixed reality. We are seeing more virtual reality activities here than in the United States," said Terry Myerson, executive vice-president of Microsoft's Windows and devices division.