App Industry Thrives Despite Recession

“App Economy” in full swing

By Stephanie Chuang
|  Monday, Oct 15, 2012  |  Updated 11:30 PM PDT
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While the recession has crippled many industries, one has not only survived   it has thrived. We re talking about the mobile app sector. Stephanie Chuang reports.

While the recession has crippled many industries, one has not only survived it has thrived. We re talking about the mobile app sector. Stephanie Chuang reports.

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While the recession has crippled many industries, one has not only survived – it has thrived. We’re talking about the mobile app sector, which has created more than half a million jobs since the 2007 debut of the iPhone. That’s according to a new report out by “The Wireless Association,” which has dubbed the phenomenon the “App Economy.”

Both experts and the numbers indicate that this isn’t a hiring bubble, especially with the number of Americans who own a smartphone. According to the Pew Research Center, 45 percent of adults in the United States owned a smartphone as of August, up from 35 percent in May of 2011. At the same time, the Apple App Store has more than 700,000 active apps, up about 40 percent from the end of last year.

PlayPhone, a social gaming provider based in San Jose, has seen tremendous growth in the last year. Scott Masters, director of Business Operations, says the company’s trademark game is poker but is expanding all the time.

“We’re roughly around 140, 150 games. We’re looking to quadruple that over the next six months or so,” said Masters. “As the industry grows, we’re going to look to grow and bring new people onboard.”

It’s the same storyline in San Francisco, where about a dozen new hires had their “training day” at Exec, another app company. Justin Kan, who became famous from this Justin.tv startup five years ago, founded Exec in February. The app allows people in San Francisco to get local help with errands and tasks using just their smartphones. It’s so popular, Kan says the company is adding dozens of people to its team every month.

“The market continues to grow in the U.S. but especially overseas, as more and more people get their first computer and it’s not actually a laptop or desktop – it’s their Android phone.”

Need more proof? Just ask Monica Bloom, a recruiter at talent agency “Vitamin T.” She says up to one third of her job is focused on hiring for the mobile industry. Bloom added even the recession didn’t slow down company requests for app industry hires. “So many of our clients are coming to us, do you have these people? And you really have to dig to find them.”

Here’s another gauge. The iTunes and Android App stores opened five years ago. As of 2011, the mobile app revenue was estimated at nearly $19 billion dollars. That figure is expected to skyrocket to $46 billion dollars by 2016.

Kan added, “A very smart VC told me that the phones becoming the remote control for the real world. It’s a great industry. It’s exploding.”

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