Bailey on the map

The moment success opened its door to Jeff Bailey, executive director of Melbourne-based Maptel, he was walking around a car park in west USA in mid-1999, waving around a GPS-enabled handheld to test its reception of satellite signals.

A marketing manager at Environmental Systems Research Institute (ESRI), the world leader in geographic information system (GIS) software for desktops and mainframes, was getting out of his car and asked him what he had in his hand.

A short conversation later and Bailey was inside ESRI’s headquarters demonstrating his software to other marketing executives.

Clearly impressed, they called in the president and company owner, Jack Dangermond, and Bailey gave a 10-minute presentation.

Immediately, Dangermond decided to work with the product, bought a 25 percent stake in Maptel a few months later and then, under its ArcPad brand, made it the most widely sold GIS handheld system in the world.

However, it turns out the “accidental meeting”, as Bailey describes it, was hardly a stroke of serendipity. He and his wife had driven 130 kilometres east from Los Angeles on their holiday to make a cold call at ESRI’s HQ in Redlands.

That timely doorknock was the culmination of a year-long campaign that had begun at ESRI’s last annual user conference in San Diego.

At that time, Dangermond had taken the stage to present a slideshow of new ideas indicating that the future of GIS software, and therefore of ESRI, lay in handheld systems. Sitting among the 9000 attendees was Maptel’s lead developer (and now CEO), Elvin Slavik, who had a fully working GIS handheld system in his bag.

In 1999, the first of the Windows PDAs with screens readable in sunlight were released, making them suitable for outdoor work. Finally, the hardware and the operating system were suitable to work with Maptel’s software – the timing was perfect and Bailey knew it.

“We had to get to this guy who was a visionary across the whole industry,” says Bailey. “When we had seen the major of the four players promoting the concept of mobile GIS for the future, we knew we had to get to the top.”

This success was hard won, and the lengths that it took Maptel to be noticed locally and internationally illustrate the difficulties facing small software developers in Australia.

Bailey’s background is not in IT but as a geologist. After graduating in the late 1960s, he worked for 10 years in the mining industry, and then for the next 13 years was research co-ordinator at the Australian Mineral Industry Research Association.

AMIRA managed research between the CSIRO and local and overseas universities on behalf of the mineral and petroleum industries, a conceptually new and very successful model that has since been mimicked by several other countries. “It was a really good way of holding a carrot out to people,” says Bailey. “But after so many years of being a middle man in that type of business you need to get out.”

In 1989, Bailey set out to perform his own R&D through a private company, initially called R.I.A. TerraSystems, which he formed with two others, a surveyor and a programmer.

The three, who remain the nucleus for Maptel today, self-funded their research by selling satellite imagery and GPS systems.

Over the next 10 years, the company became a major distributor for GPS equipment in Australia and its cash flow paid for testing and programming applications.

The two initial ideas were a desktop program Terrascan – one of the first Windows programs to run GPS on maps – and MapPad.

The latter was a GPS application designed for laptops and the Apple Newton and a forerunner to today’s ArcPad, which combines a PDA and database management with GPS mapping and is sold in over 30 industries. “In the first 10 years our software sales were negligible,” says Bailey. “We knew we had really good software but we couldn’t sell it easily.”

Part of the problem was that the majority of the customers of mapping software were government agencies and mining and oil companies which only bought the big software brands. No-one was willing to take a risk on an unknown, tiny local developer, regardless of the quality of the software.

“There are only four big brands in the geographical information area and we took the view that we had to align ourselves with one of the brands otherwise our software would be too difficult to sell.”

Another difficulty was in the testing. Without a large group of in-house software testers on hand to work out the bugs, Maptel relied on individuals within government agencies and private companies to use the program in the field and provide a constant stream of feedback.

Only 100 licences were sold to individual GIS managers – MapPad’s “champions”, as Bailey calls them – working in mining companies, local, state and federal government in Australia.

“They would only buy one or two licences but they could see that it was important for their work. It was in geological mapping, mineral exploration, asset mapping in local government in Victoria and a few councils, some electricity utilities.”

Finding these champions was no easy process but a continual slog of road shows, trade shows, talks and presentations.

One advantage was the ability to tie software demonstrations into the distribution business.

As a major GPS distributor, the company had access to a large customer base that were receptive to the idea of a GPS device positioned on a computer map in the field.

“You meet these type of people by accident – they come out of the audience when you give a presentation. That’s been our philosophy for many years, that if someone expresses interest we will help them at no cost and support them at what they are trying to do in their job.”

The small test group proved crucial to the product’s success. By the time that Maptel won an audience with the ESRI CEO, who had only just announced his company’s intention to produce such software a year earlier, the MapPad product was at version 4.1 and had sold 200 licences.

Although Maptel was a perfect candidate for government assistance it was unable to win a large grant to develop its idea.

However, the Victorian government did supply a $2000 subsidy to help with an overseas trade exhibit in San Diego. The amount, while small, was enough “to tip the bucket”, says Bailey.

“It doesn‘t sound a lot but that’s the sort of thing that helps because it is a low cost to apply for that money and then you are up and away.”

Australia is unlikely to ever compete with California’s Silicon Valley or its equivalents in India, China and Europe in nurturing a large-scale industry of programmers.

Instead it is best suited as an incubator for very small groups such as the seven-person Maptel team to come up with original ideas and then look to international distributors to sell them.

Bailey believes that subsidising overseas trade exhibitions is a smart way to guarantee that money goes to the right groups, as taking a showcase on the road takes a certain level of dedication.

But Bailey has a word of caution for young developers in a rush to monetise their ideas. “People can be a little bit naïve and show interested parties their ideas and preliminary code, whereas if it is something that is quite mature you are in a much better position,” says Bailey.

“Our product was quite sophisticated and we knew that someone looking at it would take about a year to catch up. The view we have with our software is to stay well ahead, because that’s the biggest protection.”

There was also another threat. Intellectual property resides not just in the product itself but in the staff who have worked on its development. Bailey was aware that a multinational company with deep pockets could simply poach the most talented programmers and work on a competing product in-house.

The answer was to provide equity in the company to the key developers. “That is a positive step, to be able to hold people when it gets exciting,” says Bailey.

Once the software had reached maturity, the next problem was getting the idea into the hands of the major GIS players. ESRI was the largest player and therefore the most obvious choice, so Bailey went to its local branch offices to get a hearing.

Although Bailey did manage to secure an audition and fly over to the US, no senior executives attended and he was filtered out by minor management. “We got nowhere,” says Bailey.

Then in 1999 Bailey decided to drive to ESRI headquarters – and struck a home run with the man that mattered.

Maintaining a good relationship with a large corporation still requires a fair amount of effort. Frequent visits between employees of both companies keep the lines of communication open and Maptel is always represented at business partner and user conferences, which pull over 14,000 delegates.

The multinational company also recognised the benefit of having a small, agile R&D unit and has left the developer team to its own devices. The team is still no larger than seven people.

Bailey offers the following advice to independent software vendors looking to break into the global market: “I’d say the networking approach of getting people to work with you and test your software and get some credibility locally is important. It’s really important to have something working rather than showing an idea and aim to work jointly with the overseas parties and not just trying to sell the concept.”

Maptel’s next step has been to make its software even more mobile. Telstra is already offering to all state government agencies Maptel’s CommandMap, an application that runs the same GIS program on a mobile phone through a server. ArcPad 7.0 was released this year and has been updated to work with Bluetooth, SD cards, in-built cameras and WiFi.

With one major win on the board, government funding has been much easier to secure. AusIndustry handed over more than $1 million over three years to pay for the development phase.

This time around Bailey located champions in the emergency services and Maptel has performed a number of trials with the Melbourne Metropolitan Fire Brigade, the Victorian Police and the Roads and Traffic Authority in NSW.

“We realise that we are well ahead of the rest of the world and we just have to get the CommandMap concept picked up. And that is a challenge, we are not admitting that we have got that one beat.”

But what about ESRI – wouldn’t it be the obvious buyer? “Not necessarily,” says Bailey, choosing his words carefully. “We would like them to be interested in it.” This time, at least, he has the CEO’s phone number.