Quit your job, design an app, go broke

There are people who've designed top-selling apps and made a great deal of money. Then there are people who've designed apps and gone nowhere. Unfortunately the latter outnumber the former by a factor of thousands.

As The New York Times wrote:

"Despite the rumors of hordes of hip programmers starting million-dollar businesses from their kitchen tables, only a small minority of developers actually make a living by creating their own apps, according to surveys and experts."

That hasn't stopped people from trying. There are at 700,000 apps for the iPhone and iPad, most of which you've never heard of and you never will. According to federal data, there are more software engineers (a rather broad term) than farmers and almost as many as lawyers.

The tech industry makes great claims as jobs developers. Apple said that its app business alone created nearly 300,000 American jobs, rising nearly 40 percent in one year. But this includes people all up and down the supply chain.

The main beneficiary, though, has been Apple and other large operations. "Since Apple unleashed the world's freelance coders to build applications four years ago," said the Times, "it has paid them more than $6.5 billion in royalties." But most of this has gone to a few successful developers and large companies.

But the hopefuls add to Apple's coffers as well. For instance, nearly 300,000 developers, and potential developers, have paid Apple a $99 annual registration fee.

In a way this phenomenon is like the 19th century gold rush. The people who get rich are the ones who, like Levi Strauss, who sold the equipment, not the ones who panned for gold.

The Times profiled Shawn and Stephanie Grimes of suburban Baltimore who quit their jobs, rented out their house, sold their belongings and cashed in a 401(k) to spend their time developing children's apps for Apple. They made some money, but not much. However, "At one point they owned a 24-inch iMac, a Mac Mini, a 24-inch cinema display screen, two 13-inch MacBook Airs, a 15-inch MacBook Pro, two iPad 2s, two Apple TVs, two iPhone 4s and an iPhone 3GS."

Apple does well, but the rest of us might want to hold onto our day jobs - if we have them.

As Boom Lures App Creators, Tough Part Is Making a Living (NYTimes, Nov. 27, 2012)

Creating jobs through innovation (Apple website)