Thursday, July 3, 2008

Shortage of mobile development talent sends firms to China

By Efrain Viscarolasaga

The mobile technology business is thriving in New England, but the local talent pool has failed to keep pace. From startups developing mobile products to large corporations building their own wireless applications, mobile software engineers are in high demand and short supply.

The dearth of mobile development talent can cause products to take longer to reach the market and means companies have had to train Internet application developers to learn mobile platforms.

“We can’t hire mobile workers fast enough,” said Mark Botticelli, vice president of engineering for mobile location-based application developer Trimble Navigation Ltd., which has a local presence through its 2006 acquisition of Cambridge-based Eleven Technology Inc. “When you move into the mobile space, it’s a whole different mind-set, and it can take up to a year to train a new person.”

Trimble and other companies are now looking overseas for talent, Botticelli said. But unlike the Internet boom a decade ago, when India was the capital of IT outsourcing, many mobile developers today are looking further east: to China.

Even prior to its acquisition by Trimble, Eleven Technology had used outsourced labor in both India and China. But as it has expanded its product base, which provides large enterprises with location-based mobile applications, the company has sent more work to its team in China.

That is turning into big business for U.S.-based consulting firm Dextrys Inc.

“We have a tremendous pool of mobile development talent that we are deploying to U.S. companies,” said Bob Kramich, Dextrys’ executive vice president of global solutions. “And it’s not just mobile companies that are looking for wireless developers now — it’s financial services firms and independent software firms and health-care companies.”

Originally founded as IT consulting firm Darwin Partners Inc. in 1987, the firm merged with Chinese development firm Suzsoft Co. Ltd. in 2006, creating what executives called the first U.S.-based IT consulting firm with application development in China. After changing its name to DarwinSuzsoft, the firm landed $48 million in funding last summer and then relaunched as Dextrys — with local IT consulting veteran Brian Keane at the helm — earlier this year.

Since its Suzsoft merger, Dextrys has been betting on China to become the next epicenter of U.S. outsourcing. The company has established a foothold in the general software market, but as the wireless industry has grown and the talent pool of mobile application developers has thinned, the firm has seen a boom in interest in mobile development talent in China, according to Kramich.

Two years ago, Dextrys had 350 workers in China, while today’s China workforce is more than 1,000, with about 30 percent boasting skills in the mobile arena. The company is working with 10 local wireless companies, including Trimble and Waltham-based AirPrint Networks Inc.

Mark Thirman, founder and CEO of AirPrint, said his firm is having success with the strategy, saying that the relationship with his 20- to 30-person team in China has been crucial to getting the company’s products to market. AirPrint, which employs six people in the U.S., makes a mobile printing platform that allows users to print small documents, such as tickets or coupons, using their cell phone and a small wireless printer.

China has built an expertise in the mobile realm that exceeds that of India and can offer the same outsourcing benefits — increased productivity, decreased time to market and decreased cycle time, according to Ralph Rodriguez, a senior vice president at Boston-based analyst firm Aberdeen Group. China can also offer something India can’t offer, he said: access to China’s 400 million wireless subscribers.

“China is offering not only the expertise, but a vein and a context into the Chinese market,” said Rodriguez, who is working on a report on mobile outsourcing in China due for release in the fall.

For Dextrys, officials think the boost being provided by customers in the mobile space is only the beginning of a long-term trend toward China.

“We think we are probably in the third year of a 10-year run on outsourcing to China,” said Kramich.