A US think tank has recognised strong growth in the Australian app industry suggesting that with the right policy settings, the tech sector could be a strong source of growth. Andrew Bassat’s company SEEK.com is a key example of a home grown tech success and he suggested growth in the tech sector is being held back by constrained supply in graduates in science, technology and maths.
We also saw online real estate advertiser REA Group post a 37 per cent jump in net profit in the 2014 financial year and Computershare has announced it’s agreed terms for the acquisition of Homeloan Management Limited.
Also Telstra is set to utilise data services at the ASX Australian Liquidity Centre while Digital CC will increase its Bitcoin mining capacity by 90 per cent with a US$1.3 million investment.
Economic News
With Australia’s economy in ‘transition’ and with unemployment hovering around 6 per cent, there’s a ray of hope in the ‘app’ industry. A new report suggests the number of jobs in computer engineering has grown 38 per cent since 2008.
The report by the Progressive Policy Institute has ranked Australia above the US and the UK in terms of job creation in the tech sector. The think tank says the number of Australians using mobile internet rose 33 per cent in the year to June 2013 with the number of Australian’s with a smartphone up by 29 per cent.
The report’s author Dr. Michael Mandel concedes that this is partly due to the Australian economy playing catch-up, however, it is worth noting that the computer systems design industry makes up 1.6 per cent of total employment here, as opposed to 1.2 per cent in the US.
“These figures all suggest that the digital sector may be a potential strength of the Australian economy.”
Policy has a role to play in ensuring the sector has room to expand, the report says “it’s important for policymakers to strike the right balance between essential and excessive regulation, especially in areas such as data privacy.”
Commentary
Finance News Network spoke to Andrew Bassat, co-founder and CEO of SEEK Limited
(ASX:SEK). Bassat explained his company’s strategy for staying ahead of the competition and gave us an insight into the sectors that will lead the way in jobs growth.
See the full interview
here...
Many would consider SEEK to have a monopoly on the online jobs market in Australia but have you identified any competitors or new entrants that you need to consider?
“In our space there are always new entrants, there’s people like Linkedin, there’s a bunch of aggregators, there’s a range of new competitors. We’ve managed to continue to grow our share of anything as a result of continuing to evolve our product and service.”
To what extend do you rely on innovation to keep moving forward or has your ability to innovate diminished now that you are so large?
“We take a view that, forgetting about our market share, what we want to do is help people more, so we’re well ahead of our competitors, we’re only responsible for 25 per cent of all placements in Australia, we want to be responsible for 100 per cent, so there’s many things we need to do better to increase that number.”
And for those watching who may be on the hunt for employment opportunities themselves, what emerging employment sectors have you identified that may be rising in demand?
“Clearly in Australia we are in a bit of a movement away from the mining sector - whereas a few years ago the mining sector was really starting employment engineering jobs, mining jobs and so on. And that’s moved a bit, now the eastern seaboard’s picked up a bit. States like New South Wales, Victoria, have picked up, and some of the other sectors have picked up. But, leaving outside the cyclical trends obviously things like the science areas, technology, maths and a range of areas where there are not enough graduates coming through, are really good opportunities.”
Results
Online real estate advertiser REA Group Limited
(ASX:REA) has posted a 37 per cent jump in net profit in the 2014 financial year. The company says net profit of $149.8 million reflects the underlying strength of the business and its robust strategy for local and international markets.
UXC Limited
(ASX:UXC) announced that it is expecting a substantially lower net debt position than previously forecast. The information technology company says cash payments from successfully delivered milestones on key projects and improvement in on-time cash receipts has lifted net debt from $34 million to $4.4 million.
Growth
Digital CC Limited
(ASX:DCC) will increase its Bitcoin mining capacity by 90 per cent with a US$1.3 million investment. The investment company (trading as (digitalBTC) says new equipment from the BitFury Group will be hosted in Iceland for lower cooling and energy costs.
Data#3 Limited
(ASX:DTL) has finalised its investment in WiFi analytics company Discovery Potential. The IT services company secured an option to invest in, and potentially acquire Discovery Potential last month. Six weeks later Data#3 says it has now exercised its option to acquire a 42.5 per cent stake in the company for $1.5 million and provide $1 million in working capital.
Doing deals
Telstra Corporation Limited
(ASX:TLS) is set to utilise data services at the ASX Australian Liquidity Centre. The telco says the point of presence at the purpose built financial markets data centre will address demand for enhanced market data and low latency solutions.
REA Group Limited
(ASX:REA) has bought a 17.22 per cent stake in iProperty Group Limited
(ASX:IPP) for $106.3 million. iProperty Group is an online property business operating in South East Asia and REA has bought the shares from a French property classifieds portal, [SELoger.com SA].
Amcom Telecommunications Limited
(ASX:AMM) has signed University of Melbourne for Amcom Cloud Collaboration. The telecommunications company says the deal will see it deploy the telephony and unified communication solution across the entire university community of about 13,000 users.
Computershare Limited
(ASX:CPU) has announced it’s agreed terms for the acquisition of Homeloan Management Limited. HML is a third party mortgage administration business operating in the UK and previously owned by Skipton Building Society.
Diversification
Aerial photo mapping company Nearmap Limited
(ASX:NEA) has launched an insurance service utilising its up to date visual analytics. The company says its interactive flood simulation feature will offer insurers timely data to help them measure risk with a simplified process of research and assessment.
By John Treadgold
