news Leading Australian game developers Halfbrick Studios are opening a new Sydney office and will be developing the next edition of their internationally acclaimed app Fruit Ninja in the city, announced NSW Deputy Premier Andrew Stoner yesterday, with the support of funding from the State Government.

Halfbrick’s current Brisbane office had created the original Fruit Ninja, which recently exceeded over 100 million downloads across various platforms — primarily Apple’s iOS operating system used on iPhones and iPads.

Stoner stated that the NSW Government had made the investment through the new Interactive Media Fund that has been set up to support creative digital content, including electronic games and transmedia projects.

Earlier, in October the NSW Government had announced the formation of a taskforce to help create a 10-year action plan for developing the NSW digital economy. Along with this, Stoner had also revealed the allocation of $3 million by the Government into the Interactive Media Fund.

Fruit Ninja was named by Time magazine as one of the 50 Best iPhone Apps of 2011. Stoner predicted that the worldwide gaming phenomenon Fruit Ninja would grow even larger with the project spearheaded by the newly formed Sydney team of Halfbrick Studios. A team of talented games developers for the new studio is being put together by Sydney-based developer Aidan Millott and colleague Dale Freya. The new Sydney team will progress towards evolving the Fruit Ninja games franchise. The new game will entail players releasing a series of fruit to knock ninjas off their towers in a 3D world, with each fruit having special powers.

The game’s latest edition is due out in 2012; it will initially be developed for Apple’s iOS mobile operating system. Later it will be provided for other platforms including Android.

Speaking about the fund, Stoner said that it would help NSW build its share of the high-value digital games sector, which would have increasing importance in developing serious business and educational tools in addition to entertaining games like the new Fruit Ninja project. “The global digital games market is expected to more than double to $53 billion by 2016 and mobile gaming to triple to $17.5 billion,” Stoner said.

Other Interactive Media Fund projects that the NSW Government is supporting include:

Dog Money World: An advanced mobile games platform encompassing augmented reality, social components and real-time location gaming. A narrative can be wrapped around the technology for an integrated audience-experience linked to any film or television show. Players become part of the story, undertaking virtual missions in real locations and competing against friends and other users to become the top-ranked player. While developed with crime fiction in mind, the white label platform can support any story theme from vampires and werewolves to fairies and elves.

Flashcards for iPad by INKIDS: An expansion to the Flashcards educational software title designed for children 2–10 years old to help them learn the alphabet, new words and new languages. INKIDS will build on their concept to create cross-platform titles with the goal to make Flashcards the best children’s learning application in the portable device educational software category across many languages and countries.

CADMAP (working title) by Ambulance Research Institute: A serious game to assist paramedics in their clinical decision-making skills by simulating emergencies from the safety of their mobile phones.

Expansion of Nnooo: An expansion to the indie game developer’s staff will see the employment of two junior programmers, allowing the company to grow more quickly through rapid development of its software. The new programmers will develop Nnooo’s new game escapeVektor for the Nintendo 3DS and PC/Mac or Playstation Vita.

Tag Town by MOD Productions: A location-based game that is played cross-platform using mobile apps and desktop web browsers. At its core is a social mobile experience where players identify locations from photographic clues as they move around in the real world.

Habitat: the Game by Australian Documentaries: Habitat is an online and mobile game for 8–12 year olds, supported by an animation series, which encourages players to reduce their environmental footprint and help their very own online wild animal survive and flourish.

opinion/analysis
I continue to be impressed by the NSW Government’s commitment to making Sydney the home of independent technology development, especially in the fast-growing and highly dynamic video gaming sector. Since the Coalition won government in the state earlier this year, it has really made this area a priority, reversing a lengthy period of inaction in the area from Labor. Kudos to NSW for this effort; keep it up!

Image credit: Halfbrick. Opinion/analysis by Renai LeMay

news Two high-profile Australian startups who have built their businesses on crowdsourcing this week revealed they had attracted a total of $14 million in venture capital funding that will allow them to continue to grow aggressively and extend their reach outside Australia.

The largest investment a $11 million Series A round which was ploughed into local data analytics company Kaggle by investors including Index Ventures, Khosla Ventures, Google’s chief economist Hal Varian and Applied Semantics co-founder Gil Elbaz. The deal was announced in the US, where Kaggle is now based in San Francisco, following a move from Melbourne earlier this year. The company also this week announced Slide’s Max Levchin as its company chairman.

Kaggle is fundamentally a company which conducts predictive modelling activities. “Companies, governments and researchers present datasets and problems [and then] the world’s best data scientists then compete to produce the best solutions,” the company’s web site states about its model. “At the end of a competition, the competition host pays prize money in exchange for the intellectual property behind the winning model.”

“The motivation behind Kaggle is simple: most organizations don’t have access to the advanced machine learning and statistical techniques that would allow them to extract maximum value from their data. Meanwhile, data scientists crave real-world data to develop and refine their techniques. Kaggle corrects this mismatch by offering companies a cost-effective way to harness the ‘cognitive surplus’ of the world’s best data scientists.”

In a blog post, the company said its vision was to build Kaggle into a “hive” buzzing with enough public and private competitions to support hundreds of thousands of data scientists relying on the site for their full-time incomes. Kaggle was founded by its Australian chief executive Anthony Goldbloom about a year ago.

“Having noticed that Melbourne seemed to be popping up as a hot-spot over the last few years with the emergence of Atlassian and 99designs, I asked Steve Lipchin, a business school friend who recently moved there from South Africa, to let me know what companies he thought we should look at. A few weeks later, Steve put me in touch with Kaggle,” wrote Index Ventures’ Neil Rimer in a post on the Kaggle investment.

“I met with Anthony Goldbloom and [Kaggle chief data scientist[ Jeremy Howard for coffee on a Sunday when I was passing through San Francisco, and yes it was one of those meetings that is supposed to be 45 minutes and ends up being 3 hours. It was also one of those meetings that makes you smile on your drive home because it reminds you why it is such a privilege to be in the business of helping entrepreneurs fulfill their missions.”

The second major investment to take place this week in an Australian firm is more local. It saw some $3 million ploughed into DesignCrowd, an online marketplace that helps businesses around the world outsource creative projects.

The company was launched in 2008 by local Alec Lynch from what the entrepreneur described as “his mother’s dining room table”. DesignCrowd’s ‘crowdsourced’ business model is not dissimilar to the one used by Kaggle — taking advantage of resources located around the world. The company has some 40,000 graphic designers from around the world registered to bid for design projects on its system.

This week DesignCrowd announced Melbourne investment house Starfish Ventures had invested $3 million in the company. The money will allow the Sydney company to further expand globally. “We’ve done well in Australia, now we want to take on the world, and Starfish is the perfect partner to help us succeed,” said Lynch in a statement issued yesterday.

Tony Glenning of Starfish Ventures (who led the investment in DesignCrowd) said: “We really believe in the crowdsourcing model. In particular, we are really attracted to the idea of crowdsourcing the solution, rather than simply providing a marketplace for outsourcing, which ends up as a race to the bottom and is neither beneficial to the customer nor the designer. Alec and his team have done a great job providing a unique offering that serves both.”

opinion/analysis
A few things come to mind when I think about these two investment this week. Firstly and most obviously, the idea that it’s hard to find venture capital investment in Australia has now been completely debunked. We’ve now got a stack of incubators for solid angel investment, plus VC firms locally and globally that have demonstrated a willingness to invest in Australian companies at any level — from a few hundred thousand dollars right up to tens of millions.

And it doesn’t matter how new or old the startups are — after all, Kaggle is only a year old. All that matters is their potential and early demonstration of an ability to execute on rapid growth plans.

Secondly, both DesignCrowd and Kaggle demonstrate that forming a startup in Australia can actually be a benefit to your business, not a curse. Both companies have used Australian insight into their industries (backed by our great education and technology startup community here), coupled with an ability to leverage global resources.

To my mind, it seems like this will very much be the future of Australian startups from here. Using Australian ingenuity plus tapping resources outside our borders to get the job done. And if you think about the potential for this model, it looks as though Australia’s technology startup sector has a very bright future indeed.

Australian DVD rental service Quickflix this morning revealed it had raised over $4.6 million in funding through private investors, with the money set to be put towards the company’s growing expansion plans.

Quickflix provides Australian members with the opportunity to rent movies online, after which the company mails out the DVD that arrives at member’s homes within days. The company, which had been placed in a trading halt on the Australian Stock Exchange (ASX) until today’s announcement, has announced that they’ve managed to secure $4.675 million in funding through the private sale of 55 million ordinary shares at a price of 0.085 per share.

Quickflix said the funding, undertaken by E.L. & C. Baillieu Stockbroking and Foster Stockbroking, would provide it with the means necessary to expand its online operations — the team are hard at work, adding functionality which will allow the company to stream movies over the Internet to customers.

“The funds raised under this placement puts the company in a strong financial position and supplements existing cash reserves,” the company said in a statement announcing the funding today, noting that alongside the funding, “contributions from a growing subscriber base will be used to fund sustained growth and the roll-out of Quickflix’s digital launch”.

Last week, Quickflix announced a new deal with Sony that will see their yet-to-be-launched streaming service available across a range of Sony internet-enabled devices, including Sony Bravia internet-enabled televisions, SVIB-capable Blu-Ray players and home theater systems and Sony’s VAIO computer range.

“We’re operating in a exciting space and we have plenty of growth momentum. There are always alot of developments underway which are about positioning us for the future and building shareholder value,” chairman Stephen Langsford said two weeks ago.

It’s been a busy month or so for Quickflix, which also managed to acquire equipment and assets from rival Telstra, which announced it would be shutting down its BigPond DVD rental service on September 30. Quickflix has also added a new CEO, as well as a new board member over the course of the past several weeks.

Image credit: Quickflix

The Queensland Government has unveiled a raft of moderate-sized technology projects in its state budget handed down this week. However, all are dwarfed by a substantial tranche of funding allocated towards the highly public problems suffered by its disastrous payroll systems implementation at Queensland Health.

The project was initially kicked off in 2007 as a replacement for the department’s previous ageing HR system, with the Government inking a $6.19 million contract with IBM for the replacement system, to be based on software provided by German giant SAP.

However, the project quickly ran off the rails, with IBM advising in October 2008 that it had understimated the complexity of the project. In early 2010, the replacement system went live, but malfunctioned severely, with thousands of Queensland Health workers being left out of pocket. Several reviews of the project since have damned its governance, and the state allocated $209 million in November last year for several years’ worth of fixes.

In the state budget handed down this week, the full amount was confirmed as $208.7 million over three years, which will see the system’s bugs completely worked out. Last year, Queensland noted about $46 million of that figure would be spent on improving the system this year, while another $55 million would go towards an 18 month project to add more features to the system and improve its efficiency. It’s not clear what else the full amount will be spent on.

Little was said in the state’s budget papers about the project, with the Government focusing on previously announced action taken to remedy the project’s problems.

A range of other moderate-sized projects and funding allocations which will affect a number of departments and agencies over the next several years were revealed this week, however.

Queensland Health has also received a $61.2 million grant to improve ICT, although the state did not disclose what the funding would be used for. $45 million over three years will be provided to supplement funding from the Federal Government’s Digital Education Revolution project, which is helping give every year 9 to 12 student access to a PC. Queensland’s Department of Education and Training will use the money to support the rollout, provide software licensing and put in place infrastructure, including network equipment.

The state will pay Telstra $35.8 million over three years to decommission its South Brisbane telephone exchange to make way for a new hospital in the area, and funding is also being provided in minor batches to agencies such as Queensland Police, CITEC and more — although substantial details of the projects was not included in the budget.

Image credit: Jamie Woods, royalty free

Communications Minister Stephen Conroy confirmed over the weekend that the Federal Budget due to be delivered on Tuesday night contains $308.8 million to continue a scheme which is seeing pensioners provided with a free set-top box to assist them with making the switch to digital television.

“The Gillard Government’s Digital Switchover program is ensuring people in regional and remote Australia have access to the same number of digital television channels as people in capital cities. When the switchover is complete in 2013, all Australians will have access to metro-equivalent TV services, no matter where they live,” Conroy said in a statement.

“For most people, making the switch to digital television is straightforward and inexpensive. However, the Government recognises that some Australians, particularly the elderly, people with disabilities and their carers, may require assistance to switch to digital TV.”

The program provides eligible pensioners with a HD set-top box and assistance to install the hardware and use it – at no cost to the receipients. The 2011/2012 budget provides funding for the program until the end of the Digital Switchover program across Australia at the end of 2013.

The news comes as the Federal Government is increasingly ramping up its push to switch the nation over to the new digital television standard. The spectrum used for the analog television signal – known as the ‘Digital Dividend’ – will be reallocated to other purposes, such as supporting mobile networks in Australia.

Just last week, Conroy announced a switchover date for regional Queensland, as well as the launch of free to air digital TV services by satellite to residents in remote and regional Western Australia, via a government-funded service.

A number of towns in regional Queensland – such as the regions of Wide Bay, Capricornia, Darling Downs and so on, will switch to digital-only TV on 6 December 2011.

“More than four out of five households in regional Queensland have already converted to digital TV, according to the latest Digital Tracker survey to the end of March 2011,” Conroy said at the time. “Those households yet to make the switch to digital now have a deadline for when their analog TV signals will be switched off for good.”

Conroy said 79 per cent of households across Australia were now digital ready, according to the latest figures from the Digital Tracker survey for the first quarter of 2011: “Whether by terrestrial or satellite broadcast, almost four out of five households across Australia has now made the switch to digital TV. This compares to less than half of households which were digital ready just two years ago.”

Image credit: Ry Young, royalty free

A number of high-profile technology projects which have been on the Department of Defence’s drawing board for years have been approved by the Federal Government, paving the way for hundreds of millions of dollars of technology spending to be unlocked over the next decade under the guidance of Defence chief information officer Greg Farr (pictured).

The highlight of the announcements late last week was Defence Minister Stephen Smith’s move to approve funding for a project definition study which will look into an overhaul of Defence’s troubled human resources management and payroll platforms.

Defence currently operates several major payroll systems – the high-profile PMKeyS, which broadly supports the force’s civilian remuneration (although it also supports the armed forces somewhat), and the Central Reserve Pay System (CENRESPAYII). CENRESPAYII is the system at the centre of Defence’s remuneration debacle in 2008 which saw some officers receive incorrect payments. A separate system, ADFPay, generates what Defence describes as the “allowance” component of the armed forces remuneration.

In Apri 2009, a KPMG audit of those pay problems found that Defence’s “ageing” computer systems were working well, but nonetheless were experiencing “vendor support issues”. Defence’s chief information officer group, led by Farr, has long been working on a replacement strategy, dubbed the Defence Personnel Systems Modernisation.

In a statement last week with Defence Material Minister Jason Clare, Smith said the Government had given approval for Defence to conduct pre-first pass analysis to investigate the costs and risks associated with streamlining and improving its HR and payroll systems.

“Defence will now report to Government in Financial Year 2011-12 on its requirements and implementation options with a vital requirement being the integration of the military payroll capability into Defence’s core personnel management system, which is currently used to pay over 20 000 Defence civilian employees,” the statement said. “Joint Project 2080 Phase 2B.1 is cost capped between $100 million and $500 million.”

The duo of ministers also gave first pass approval to Defence’s planned new Battlespace Communications System (Land). The project aims to provide a modern, deployable communications system which will enable combat information to be transmitted over a range of wired and wireless networks (including radio and satellite, for example) – including the transmission of multimedia information.

“This Project will enable Army and elements of the Air Force to replace ageing mobile communications infrastructure services and provide commanders with an increased level of situational awareness, command and control and information sharing capability,” the pair’s statement said. “This equipment will greatly enhance Defence’s ability to use modern information technology to link sensors, weapon systems, commanders and personnel in a networked environment.”

Although the Government does not expect to make a final decision on approval for the project until between 2012 and 2015, it has allocated costs between $100 million and $500 million for the project.

New Defence desktops
Like its payroll systems replacement project, Defence has been seeking to overhaul its desktop PC platform for many years, with Farr famously highlighting the fact that many Defence staff run multiple desktop PCs to separately access its two internal networks – the more mainstream Defence Restricted Network and the Defence Secret Network.

In April 2010, Defence requested suppliers interested in helping the department overhaul its desktops provide it with information as part of a request for interest process. The potential exists for Defence to shift to a thin-client model, instead of utilising traditional desktop PCs.

Last week, Defence Science and Personnel Minister Warren Snowdon noted the Government had given first pass approval to Defence’s Next Generation Desktop project.

“It will make use of thin client and application virtualisation technology to deliver more effective use of Defence’s ICT resources,” the statement said. “Some key benefits anticipated from the Next Generation Desktop Project are increased savings on support and equipment costs, enhanced delivery of software upgrades and the introduction of new applications to the Defence Information Environment, and the delivery of a multi-level security capability.”

Defence will now proceed with a pilot project, which will assist the department in confirming its detailed requirements and costs for the full implementation. “This project will have positive industry outcomes, and also reduce energy consumption in Defence. Investment in Information Technology reform is critical to Defence, and this project will deliver the next generation of desktops for the department”, Snowdon said.

Image credit: Department of Defence

The Federal Government has allocated $375.4 million over the next 12 years in tonight’s budget to building its new satellite platform for providing digital free to air television services across the nation.

The platform — dubbed VAST for Viewer Access Satellite Television service — will aid television broadcasters around Australia in bringing digital television to their local areas.

“Under an agreement reached with all television broadcasters across Australia, broadcasters will upgrade a substantial number of existing regional and metropolitan analog ‘self-help’ transmission facilities to operate in digital, while the Government will fund the VAST service,” said a statement issued by the office Communications Minister Stephen Conroy tonight.

The service will provide the main standard definition channels — Seven, Nine and Ten — as well as high definition channels and new digital channels like Go!, 7TWO and ONEHD. The national broadcaster channels — ABC1, ABC2 and ABC, as well as the forthcoming ABC news channel and SBS ONE and SBS TWO — will also be transmitted through the satellite.

“The VAST service will also provide a dedicated news channel containing the local news content of the regional commercial television broadcasters from all regions of Eastern Australia,” Conroy said in the statement.

“As a result, all Australians watching the satellite service will be able to see locally relevant news. The Western Australian broadcasters will deliver their regional news services as they do at present.”

Conroy said in general the service was aimed at fixing the “poor television reception” which he said for some years had troubled a number of residents in regional remote areas of Australia.

“It will ensure that viewers who are unable to receive terrestrial television services are not left behind in the coming switchover to digital,” the Minister said. That switchover kicks off in the Sunraysia area in late June this year and will finish nationally at the end of 2013.

A further $99.1 million in funding running through the end of 2013 will aid about 130,000 viewers in about 600 communities who currently use community-run self-help towers to view television. Under the new scheme those towers will be shut down.

“The satellite subsidy will be a minimum of $400 per household, with higher amounts of $550 for defined ‘very remote area’ households and $700 for defined ‘far north tropical’ households,” said Conroy. “In addition to these subsidy amounts, households in identified remote indigenous communities may be eligible for an additional $280 worth of assistance.”

Image credit: MJimages, royalty free

news Australian audiovisual technology startup Audinate has raised another $4 million in funding from existing local investors Starfish Ventures and Innovation Capital.

The company was founded in 2006 as a spin-off from the nation’s flagship ICT research centre National ICT Australia (NICTA) and has quickly attracted a number of customers for its technology, which replaces traditional analogue cabling in large entertainment venues with a flexible digital equivalent based on the TCP/IP protocol on which the internet is based.

Audinate’s solution is dubbed ‘Dante’ and has been picked up by a number of partner manufacturers such as Bosch, Yamaha, Peavey, Dolby and Lab.gruppen.

The two venture capitalists are both headquartered in Australia and have significant funds under management, according to their sites — $400 million at Starfish Ventures and $100 million at Innovation Capital.

Audinate didn’t disclose the total amount invested in its operations so far in a statement issued last week regarding the additional $4 million, but TechCrunch investment tracking site CrunchBase has listed a previous round of $3.71 million in June 2008, involving Innovation, Starfish and the US-based National Insurance Producer Registry.

“Audinate’s management team has consistently delivered on transforming its unique technology into a great global business,” said Starfish investment principal Michael Panaccio in Audinate’s statement.

“We have been extremely impressed with the momentum of adoption among the major OEMs who have committed to implementing Audinate’s solution.” said Innovation Capital general Partner Roger Price.

ZDNet.com.au startup blog bootstrappr gave Audinate a “boom” rating in July 2009, indicating commentator Brad Howarth saw a solid future for the startup. He noted the technology had been used, among other things, for distributing audio at a Star Trek film premier at the Sydney Opera House and for the well-attended events associated with World Youth Day in Sydney last year.