Software developers who undertake collaborative development and have to shift large files both locally and internationally are at a competitive disadvantage due to poor network performance, they say.
Peter Dickinson, CEO of Auckland-based business suite developer Greentree, says while developers find ways of doing their jobs, “you don’t know what you haven’t got until you experience it”.
Dickinson says if you are travelling on a horse along a dirt track and your competitor is on a superhighway, they are going to get there first.
“We do a lot of collaborative development,” he says. “It’s quite difficult at times for remote developers. Productivity is affected.”
Dickinson says developers live with it because that’s the way it is. They start a download or upload and go away and do something else.
“We’re at a significant strategic disadvantage not having the capabilities of competing companies offshore,” he says.
Greentree has shifted its website to the US because it costs about a quarter the amount of similar local services. Also, trans-Tasman performance is better out of the US than from New Zealand, Dickinson says. Greentree is a significant player in the Australian mid-market financial software and ERP suite space.
Dickinson says the scale of US service providers contributes to those cost differences, but he is also sure local hosters are paying “a hell of a lot more” for their pipes.
Most of the same issues affect Auckland multimedia studio Cactuslab, director Karl von Randow says.
“In New Zealand we are always thinking about bandwidth,” he says.
Developers building websites constantly have to ask themselves if applications are too big and will take too long to download.
People in New Zealand don’t even consider building websites such as YouTube and Flickr, which are based around massive bandwidth usage.
“We don’t have any big bandwidth applications coming out of New Zealand,” he says.
Some locally-built, innovative websites aren’t as successful as they could be because people just don’t have the connections to enjoy them fully, he says.
Like Greentree, Cactuslab hosts many of its sites in the US, because when it comes to gigabytes of bandwidth, New Zealand just can’t compete on price, von Randow says. The company also chooses to host sites with bigger audiences in the US, even if the company is based in New Zealand, simply so people will be able to browse the sites more quickly. In general, it makes sense to host the site close to the audience, he says.
The company chose to switch to a fibre plan through Vector a couple of years ago. The main reasons for going for fibre were time savings on uploads, unlimited national traffic, and not having to worry about going over the cap, says von Randow.
Xero founder Rod Drury is perhaps the most prominent software developer to beat the broadband drum. Last February he wrote a paper called “Securing our Digital Trade Routes” in which he advocated public ownership of a fibre network.
He later wrote, in The Independent Financial Review, that the incident that converted him into a “digital socialist”, was at his previous business, email software developer AfterMail.
“We subscribed to a US-based voice over internet protocol (VoIP) telephony service, which for US$35 per handset, gave us unlimited calling through the US. But even better it meant we could choose US phone numbers. This simple service, used extensively overseas, allowed us to appear close to our customers and sales prospects. VoIP is a fairly low bandwidth application and even this was unusable from here.