All advertisers seek to deliver the right message to the right person at the right moment. If content is king, then context is queen – particularly when it comes to mobile devices that are typically close at hand if not in our hands.
Smartphones and tablets are often lumped together as “smart”, “mobile”, or “connected” devices, but their use varies by person and by context. In this post, we explore context as it relates to iOS devices. We discuss who uses each device, which devices are used to enact what aspects of users’ lives and personalities, and when usage tends to take place.
Because Android and iOS devices have different audiences, we focus only on iPhone and iPad in this post. Flurry currently measures activity on 397 million active iOS devices, and this analysis is based on usage during May of a random sample of 44,295 of those (iPhone and iPad only; iPod Touch was not included). A future post will discuss usage patterns on Android tablets and smartphones.
iPhone Goes Out; iPad Stays In
Flurry has developed a set of Personas in which device users are assigned to psychographic segments based on their app usage. An individual person may be in more than one Persona because they over-index on a variety of types of apps. Those who own more than one device may not be assigned to the same Personas on all of their devices because their app usage patterns may not be the same across devices.
We started this analysis by considering what share of iOS devices used by members of each persona were iPhone and iPad. As shown in the “everyone” benchmark in the chart below, overall iPhone had a 72% share and iPad had 28%. The Personas shown above the “Everyone” bar skew more toward iPhone than the general population of iOS device owners, while the Personas shown below the “Everyone” bar skew more toward iPad.
Beginning at the top, the numbers illustrate that Personas “on the move” skew most heavily toward iPhone: Value Shoppers use iPhone to scan barcodes and find bargains, and Singles and Hip Urban Lifestylers use them to socialize. iPhone represents more than 90% of iOS devices (excluding iPod) owned by members of those Personas.
Somewhat surprisingly, that is also true of New Moms. In that case they may still be on the move, but in pursuit of the goods, services, and support they need for their new babies. New Moms may also have less free time to participate in leisure activities like reading and gaming which, as we will show soon, are more heavily associated with iPad.
It appears that moms’ device usage changes as their children get older. Moms (as opposed to New Moms) are one of the Personas that skew most toward iPad. Evidence from other sources and anecdotal observation suggests this is likely to be at least partially attributable to Moms using their tablets to entertain and educate older children. The fact that the Parenting and Education Persona skews toward iPad also supports this.
Moving to the bottom of the chart, the Personas that heavily favor iPad are associated with home-oriented activities. Those include Pet Owners and Home Design Enthusiasts, but also Small Business Owners, who may work from home. Gamers also skew more heavily toward iPad.
iPad Is For Learning and Playing -- Not Navigating
The time iPhone and iPad owners spend in different categories of apps also support the overall pattern of iPhone going out and iPad staying in. Overall, iPad owners in our sample spent 42% more time in apps on their devices than iPhone owners during May, but that time varied significantly by category. As shown in the chart below, compared to iPad owners, iPhone owners spent more than 13 times us much time using Navigation apps. They spent more than five times as much time using Health and Fitness apps to do things such as tracking walks, runs, and bike rides.
The app categories for which average time spent on iPad exceeds that for iPhone are Education, Newsstand, Games, and Reference. Again, more home-oriented activities.
iPad Is For Evening; iPhone Is For Late Night
The chart below shows how time spent using iPhone and iPad apps is distributed throughout the day. As might be expected based on the previous discussion and conventional wisdom about iPad, its heaviest period of use comes between 6 pm and 11 pm – times when most people have downtime for activities such as games and reading. iPhone app usage also peaks during that time, but the absolute amount of time on iPad and the percentage of app use that occurs during those hours is greater. Both of those differences are statistically significant.
The situation reverses as the night wears on, and between 2 am and 4 am usage is greater in iPhone apps than in iPad apps. This may be insomniacs reaching for phones at their bedside or those Singles and Hip Urban Lifestylers finding their way home from a late night.
What is perhaps most surprising about the distribution of time on each device throughout the day is how consistent the patterns are – especially between about 6 am and 4 pm. Given what we’ve described so far about iPhone being more of an out-and-about device and iPad being more of a stay-at-at home device, we believe that this is a function of varied lifestyles, with owners of different devices being at home and out-and-about at different times.
Multiple Devices, Multiple Personalities?
Our discussion up until now has focused on differences between iPad and iPhone owners, but obviously an increasing number of people own both devices. While our data does not enable us to link the same user across his or her different devices, we believe that individuals may express different parts of their personalities and lifestyles through their use of different devices. For example, by night a person in the Single and Hip Urban Lifestyle Personas may use her iPhone to organize her social life. By day that same person may use her iPad to run her interior design business, putting her in our Small Business and Home Design Enthusiast Personas.
That combination of person, usage situation and device is important for app developers and advertisers. For example, in this situation, our single small business owner may be more receptive to work-oriented apps and ads on her iPad and play-oriented apps and ads on her iPhone. Savvy app developers and advertisers will increasingly factor contextual differences such as those into their development and targeting plans.
Apps are telling – they signal our personal tastes and interests. There are probably nearly as many unique combinations of apps as there are devices, and the apps we use reveal a lot about us. Based on Personas that Flurry has developed for its advertising clients, we are beginning a series of blog posts to shed light on different groups of smartphone and tablet users and their app usage patterns. Moms -- who often control household budgets and expenditures -- are considered the prime audience for many brands. So we thought, where better to start our Personas series than by examining what moms are doing with apps?
Our analysis for this post relies on iPhone, iPad, and Android app usage during May of this year for a large sample (24,985) of American-owned smartphones and tablets. Discussion of app usage is based on time those devices spent in the 300,000+ apps that use Flurry Analytics.
What Apps Do Moms Use?
Moms, like most other groups, spend a lot of smartphone and tablet time playing games. In fact, on Android, more than half of the time American Moms spent in apps was spent playing games. Similarly, on iPad moms spent about half their time in games, but on iPhone, that percentage drops to a little less than a third of their time. On iPhone, lifestyle apps capture a larger proportion of Moms' attention (12%) than on iPad and Android devices.
As shown below, the second most popular category among moms on iPhone and Android devices is social networking. On iPad, newsstand (24%) was the second most popular category, demonstrating its strength as a screen for displaying magazine type content.
Where Do Moms Over-Index?
Most mobile consumers spend a large proportion of their app time in gaming and social networking apps, so what makes moms different from the other American owners of smartphones and tablets? Across iPhone, iPad, and Android, American Moms spend more time in education apps than the general population. Also, moms who own an iPhone or an Android device spend a greater share of their app time in health and fitness apps. Unsurprisingly, moms are also heavy shoppers. Android moms over-index for time spent in shopping apps, and iPhone moms over-index for time spent in catalog and lifestyle apps. (For this post, we have honored The App Store and Google Play’s systems for classifying apps. In iOS, shopping apps can fall into either the catalog or lifestyle category, whereas Android has a dedicated “shopping” category.)
Moms Own More Tablets And Gravitate Toward iOS
Compared to other American device owners, moms are enthusiastic users of tablets. As shown below, among the general population 25% of connected mobile devices were tablets, but for moms that percentage is 35%. This could be driven by the fact that many parents use tablets for sharing games and stories with their children.
60% of the smartphones and tablets we looked at were iOS devices. (Note that this number is a function of the installed base of active devices, so does not reflect market shares from sales in recent quarters.) For American Moms, the numbers lean even further toward iOS devices. A whopping 77% of moms own iOS devices while just 23% own Android. There are at least two factors that may explain this. First, it could be a function of Moms’ greater tablet ownership since iPad dominates the tablet market. Second, surveys show that women in general skew toward iOS devices. The key takeaway is that moms are much more likely to be found using iOS devices than Android devices.
For Moms, Connected Devices Are More For Escape Than Utility
So what can we infer about American Moms based on their app usage? For one thing, it appears that they use smartphones and tablets as a refuge from their busy lives. On average, half or more of the time they spend in apps is spent on social networking and game apps. In this sense, they are not that different from other Americans, but it does show that even busy moms need to escape and socialize, and mobile devices provide a way to do that.
Apps where American Moms spend a disproportionate share of time relative to other Americans also tell us something about their more serious side. Those apps tend to be improvement-oriented: education and health and fitness, for example. Moms are using their devices to help them achieve personal goals and possibly to educate their children.
We hope this post gives brands and developers a better idea of where the coveted American Mom is most likely to be during mobile time, and what is capturing their attention. App developers can tap into this valuable group by building experiences that give moms an escape from their hectic day-to-day routine, keep them socially connected, and help them improve different aspects of their lives. Media planners who want to reach American Moms should continue to buy ad inventory in gaming, news / magazine, and social networking apps, and to weight their budgets toward iOS apps.
Over the past four years, Apple’s iOS and Google’s Android have been locked into a two horse race for mobile OS ownership. In the past year, there has been a lot of focus on the rise of Android and its lead in device market share. More recently, many analysts started questioning the true value of Android’s market share especially in the high-end smart phone and tablet markets. At Flurry, we felt that it was important to take a step back and look beyond straight device or activation numbers to simply understand what market or markets are being contested.
In this report we do just that, arguing that there is more than one race for mobile market share occurring simultaneously. We analyzed four years worth of Flurry’s data to understand who is ahead in which contests, discuss the apparent strengths and weaknesses of the competitors, and consider the implications for the overall mobile ecosystem.
Android Leads In Device Market Share
It is clear from announcements from device manufacturers such as Apple and Samsung that Android is winning the race for device market share. Flurry’s own data supports this. The number of Android devices we are tracking worldwide doubled in the past year, reaching 564 million as of April of 2013. While the installed base of iOS devices that we track has also grown over that time, Android pulled ahead in active device share in late 2012 and has maintained that position ever since. This is shown in the chart below. This lead followed a period of just over a year in which the number one spot was changing hands. Prior to that Apple dominated the connected device market following the launch of first iPhone and then iPad. Approximate launch dates of some of the major iOS and Android devices are also shown on the chart as points of reference.
iOS Leads In App Market Share
In spite of Android’s rapid rise and current lead in device market share, iOS continues to lead in terms of time spent in apps. Total time in Android apps nearly equaled that in iOS apps in March of 2012, but it has declined somewhat since then, after the launch of the 3rd generation iPad.
Considering that there are more active Android devices than iOS devices but iOS users collectively spend more time in apps, it’s not surprising that more time per device is spent in iOS apps than in Android apps. The exact proportion of time spent in apps per Android device relative to iOS devices is shown below.
Why Doesn't App Share Follow Device Share?
An obvious question that arises when looking at the charts above is why app usage shares don’t follow device shares. We think there are at least three possible explanations.
One is that at least up until now the two dominant operating systems have tended to attract different types of users. Once Apple established the app ecosystem many of the consumers who purchased iOS devices were doing so to be able to run apps on those devices. They were buying a computer that fit in their pocket or purse. In contrast, many Android devices were provided free by carriers to contract customers upgrading feature phones. To the extent that those customers were just buying replacement phones, apps may be a nice add-on, but not a central feature of the device.
A second possible reason for why Android’s share of the app market lags its share in the device market is that the fragmented nature of the Android ecosystem creates greater obstacles to app development and therefore limits availability of app content. Hundreds of different device models produced by many manufacturers run the Android operating system. App developers not only need to ensure that their apps display and function well on all of those devices, but they also need to contend with the fact that most devices are running an old version of Android because the processes for pushing Android updates out to the installed base of Android devices are not nearly as efficient as those for pushing iOS updates to iOS device owners.
The final possible explanation for the differences in device and app usage shares relates to the first two. It is that the arguably larger and richer ecosystem of apps that exists for iOS feeds on itself. iOS device owners use apps so developers create apps for iOS users and that in turn generates positive experiences, word-of-mouth, and further increases in app use.
While app share and device share are two key races in the competition for mobile supremacy, they are not the only races. Another that has been in the news recently is the race for profits, in which Apple is the clear leader. Apple also currently appears to be winning the race for developer attention – probably both because of its share of app usage as described above and because both surveys and anecdotal evidence indicate that iOS device owners tend to generate greater advertising and in app purchase revenue.
A side race that Android appears to be winning is that for the emerging world, where its lower prices and open architecture give it an advantage. Apple has taken notice of that and is fighting back with incentives, monthly payment plans and cash backs in several emerging countries. In India, for example, a Times of India article suggests that these programs have given the iPhone a 400% boost in sales in the past few months.
As we’ve shown, there are multiple contests for mobile market share occurring simultaneously. That raises a question about whether that is a temporary state that will eventually give way to a clear overall winner or if there can be multiple long-term winners. For the moment it seems as though the consumer is winning in that they are able to choose devices from two dominant ecosystems as well as several smaller ecosystems.
Flurry recently quantified China’s meteoric adoption of iOS and Android applications. While China ranked 10th in application sessions at the beginning of 2011, it finished the year in 2nd place, only behind the United States. With its large population and rapidly emerging middle class, adoption of apps vaulted China into the position of world’s 2nd largest app economy. In additional analysis, Flurry also determined that China has the most market upside, based on calculating those in China who can afford smartphones versus the current installed base.
This report reveals that, for the first time ever, China now leads in new smart device adoption (iOS and Android smartphones and tablets). We also update app usage velocity trends for China and the rest of the world, since first studying this late last year. For this report, Flurry used its entire data set, tracking more than 1 billion anonymous, aggregated application sessions per day. More than 60,000 companies use Flurry Analytics across more than 160,000 applications.
China's Growth Spurt
Let’s start with a look at the fastest growing countries, as measured by app session growth.
Comparing Q1 of 2011 versus Q1 2012, the chart above shows the ten fastest growing countries in terms of app sessions. A session is the launch and use of an application. For example, a consumer who opens a news application and then spends two minutes reading various articles counts as one session. Starting on the left, China leads the world in app session growth, with an enormous growth rate of more than 1100% between Q1 2011 and Q1 2012. China’s growth rate is particularly staggering given that it was already the world’s 7th largest country in terms of app sessions by the end of Q1 2011. This speaks to the country’s sheer population as well as increasing affluence among a meaningful part of its population. Please note that we project the last ten days of Q1 2012.
Building an App? Go East, Young Man!
We next study new device activations between China and the U.S., with amazing results.
The above chart shows new iOS and Android device activations per month in the U.S. and China for the last 15 months, from January 2011 through March 2012. In January 2011, the U.S. accounted for 28% of the world’s total iOS and Android device activations, while China accounted for 8%. In February, Flurry calculated that China surpassed the United States in monthly new iOS and Android device activations for the first time in history. China is now the world’s fastest growing smart device market. For March, we project that China will account for 24% of all iOS and Android device activations, while the U.S. will account for 21%. Again, please note that we project the several days of March to round out Q1 2012.
With China now activating more devices per month than the U.S., this means that the gap is closing between the two countries in terms of installed base. Not only is China already the second largest app economy, but also could eventually overtake the U.S. as the country with the largest installed base of smart device users. We estimate that the U.S., a more mature market, currently has more than twice as many active devices than China. However, China, a faster growing, emerging market, already has twice as large an installed base as the next largest market, the UK.
Apps Without Borders
In this last chart, Flurry looks at the shift in application usage across the world.
The chart above compares mobile app sessions tracked by Flurry Analytics in Q1 2011 versus Q1 2012. The green area shows the percent of app sessions occurring in the United States, the leading mobile app market. While the absolute number of sessions in the U.S. has more than doubled between Q1 2011 and Q1 2012, its share of total sessions has declined from 56% to 46%. In other words, while the U.S. app market is growing rapidly, the rest of the world is growing even faster. Looking at the balance of the top 10 countries (ranks 2 – 10: China, UK, South Korea, France, Australia, Canada, Japan, Germany and Spain), this group has increased in collective sessions by 3.4 times between Q1 2011 and Q1 2012, resulting in an increase in total session-share from 27% to 30%. Further, the rest of the world (another 217 countries across which Flurry tracks user sessions), has grown by more than 4 times, increasing in session-share from 17% to 24%.
No matter how we slice it, the application market continues to grow at unprecedented rates, and increasingly across more borders. With smart devices adoption rates more than four times greater than those witnessed during the 1980s PC revolution and twice as great as those seen during the 1990s Internet Boom, no other consumer technology has been more accessible than smart device application software. It’s literally taking over the world.
In just two years, tablet computing has gained unprecedented traction. According to research firm Strategy Analytics, global tablet shipments more than doubled during the last three months of 2011, rising to 26.8 units, up from 10.7 million a year earlier. And while Apple continues to dominate the tablet category, having sold a record 15.4 million units during the final quarter of 2011, Android OS tablets have increased their share of the tablet category, growing from 29% in Q4 2010 to 39% in Q4 2011.
The increase in market share is due largely to the entry of the Kindle Fire by Amazon. With Flurry in tens of thousands of Android apps, including many of the most popular, the company estimates that it tracks over 20% of all consumer sessions on more than 90% of all Android devices each day. A session is defined as the launch and subsequent exit (or pause for more than 10 seconds) of an app. For example, a consumer may play a game in one sitting for five minutes. Let’s take a look at the data.
The chart above compares application sessions among all Android tablets before and after the holiday season. For January, we use month-to-date figures, at the time this report was written. Since we’re looking at proportions of use, estimating the remainder of January would not change percentages. For an easier visual comparison, we label Amazon Kindle Fire in orange and Samsung Galaxy Tab in blue. On the left, in November, we see that Samsung Galaxy Tab dominated application session usage on Android, with the Kindle Fire only having recently launched. At that time, the Samsung Galaxy Time was widely considered the only viable competition to the iPad, though a distant second. In January, after the holiday boom in devices and in apps, we see that strong adoption of Kindle Fire, combined with significant downloads driven from the Amazon App Store, resulted in a massive surge in session usage that just edges out the Galaxy Tab. Unrounded, Kindle Fire represents 35.7% of sessions and Galaxy Tab represents 35.6%. Remarkably, and from a standing start, the Kindle Fire overtook the Galaxy Tab in just a few short months. Total Android tablet sessions in January more than tripled over November, with Galaxy Tab sessions increasing by more than 50%. Overall, Android Tablets are growing aggressively as a category.
Amazon Uses Its “Fork” to Eat Samsung’s Lunch
So how can a late entrant like Amazon, with little-to-no hardware DNA, waltz in and knock off a consumer electronics juggernaut like Samsung, a company that also enjoyed strong growth in 2011? This is where we believe things get interesting. In short, Amazon’s launch of Kindle Fire had more in common with an Apple-style launch than it did with aligning with the Android system. To date, the Android world has focused on marketing the operating system and the “power” of the devices, with quality of content and the consumer experience subordinated in priority. With Google managing the Android Market, which lacks content control and a seamless commerce experience, inertia pushes those developers who choose to build for the platform toward advertising models. Developers who monetize through other means tend to make less on the platform. To ensure that it could take full advantage of its unique digital store prowess, Amazon forked the Android operating system.
Apple, on the other hand, understands that great content is the key to increasing the attractiveness of hardware. They learned this hard way during the 1980s when an inferior combination of PC hardware and operating systems overtook Apple computers, primarily due to a lack of software. This time around, for the iPhone and iPad, Apple created a robust economy in which developers could thrive, ensuring their allegiance to innovating for the Apple platform, ultimately making Apple hardware more desirable, and creating a rare, but powerful virtuous cycle. To understand how well Amazon might attract developer support, we studied how well Amazon drives paid downloads in its store versus the Android Market through the Kindle Fire and Galaxy Tab, respectively.
To build this chart, we gathered download data from a “basket” of 5 paid apps that ranked in the top 10 apps in both the Amazon App Store and Android Market during January 2012. We then compared how many of these paid downloads were downloaded to the Galaxy Tab versus the Kindle Fire. From our analysis, we found that the Kindle Fire drove over 2.5 times more paid downloads to consumers than the Samsung Galaxy Tab. This shows that for tablets, the Amazon App Store can already deliver more direct revenue to developers than the Android Market. Even more impressive is that the Galaxy Tab, launched in November 2010, has a much larger existing installed base than the newly launched Kindle Fire. Flurry estimates that the active number of Galaxy Tabs in the market is at least twice that of the Kindle Fire.
Amazon Thinks Different
Amazon’s go-to-market strategy for the Kindle Fire is ground breaking among the Android guard. With its offering, Amazon takes the focus away from the device and operating system, emphasizing content, a differentiated consumer experience and commerce. For its launch, it lined up key content such as Facebook and Angry Birds, as well as offering Amazon Prime, its own streaming TV and movie service. Beyond leveraging its cloud and e-commerce infrastructure, Amazon controls its own store, commanding among the largest aggregations of consumer credit card accounts on the planet. Upon launching the Kindle Fire, consumers must either link to their Amazon account or enter credit card information. This makes the user base 100% payment enabled.
Amazon’s approach to the distribution of digital content is the ultimate razor-razorblade model, where the “stalk” (tablets) is given away for as little as possible and profits are made from the sale of razors (content). Understanding that Amazon is a high volume seller of goods, now becoming ever more digital than physical, sheds light on why they embrace the end-user experience and the religious focus on making the sale of content compelling and easy. Further, it shows us why launching with an aggressive low price penetration strategy for their hardware, priced at $199, was critical to its strategy.
Making the Old New Again
Amazon, who once moved the world from buying goods at retail to buying them online and having them shipped to doorsteps, is now distributing the new form of mobile store via tablets. In a move that reduces the possibility of its own disintermediation, Amazon’s distribution model starts with its own roots: books, music and video (aka “BMV”). Through this move, Kindle Fire is changing the rules of engagement on the Android platform to shape the playing field into one where they, the consumer and the developer win.
Before Harry met Sally in the late ‘80s, the dating process typically involved an introduction from a friend. Then, with the Internet and email, dating evolved. By the time we were watching the movie You’ve Got Mail - and actress Meg Ryan was cementing her status as a romantic comedy lead - the concept of online dating was going main stream.
As a social ritual, dating is a human behavior easily accelerated by technology. And it’s big business. One recent study estimated that nearly 1 in 5 singletons, who have access to the Internet, use Internet dating. Another report stated that 17% of recent marriages in the U.S. were the result of online dating websites. In size, combining North American and European markets, the online dating industry well exceeds $2 billion in revenue. Within the world of mobile apps, the largest category on iOS and Android, behind gaming, is Social Networking, in which dating apps appear. Given the voracious consumer usage we’re observing, it may also be the smartphone’s second killer app.
In this report, Flurry compares the usage of dating websites (combined desktop and mobile web) to native mobile applications over the past 12 months. For Internet consumption, we built a model using publicly available data among the top 50 dating websites from Compete.com, comScore and Alexa.com. For mobile application usage, we used Flurry Analytics data, which now tracks over 90,000 mobile applications. With respect to dating, Flurry tracks a large set of dating apps with more than 2 million total users.
Let’s start with total time spent on eDating in mobile apps versus on the web. Note that for this report, we use the term “eDating” to encompass online and mobile app dating.
As you can see, mobile dating apps now command more time compared to online dating sites: 8.4 minutes vs. 8.3 minutes. A year ago, people spent more than twice as much time on the Internet for dating as they now do in mobile apps. However, mobile app usage has increased dramatically over the last year, from 3.7 minutes in June 2010 to 8.4 minutes in June 2011, overtaking online dating time spent. These findings parallel Flurry’s recent report that showed, in total, mobile app usage has overtaken Internet usage.
In terms of engagement, frequency of use is driving growth in time spent per day in mobile dating apps. Last year, the average user opened his dating app 2 times per day, a little under 2 minutes each time. Now he opens his app over 5 times a day, but for shorter periods of time, about 1.5 minutes per session.
Next, let’s look at the proportion of people who use the Internet vs. mobile apps for eDating.
The chart above shows that dating apps are more popular on smartphones than online dating sites are on the Internet. We measured this by looking at the proportion of unique users of dating services versus the total, per platform. For the Internet, we compared unique visitors of online dating sites versus the total number of people using the Internet, which totaled 12% in June 2010 and 13% in June 2011. For mobile apps, we compared unique users of mobile dating apps versus all apps, which yielded 15% in June 2010 and 17% in June 2011.
We also found that the number of people using dating apps is growing faster than the number using all apps. In short, dating is a growth category. Overall, the number of unique users of all applications increased 125%, year-over-year, while the number of unique users using mobile dating apps increased by 150% over the same period. Comparing Internet dating to mobile app dating directly, unique users in mobile dating apps now account for about one third compared to the number of Internet dating users, which has doubled over the last year.
In an age where Facebook allows consumers to display their relationship status and easily connect to friends of friends, we speculate why mobile dating apps are gaining unprecedented traction on iOS and Android. The first reason, we believe, is that dating itself is inherently local and better served by mobile. Now, unplanned meetings of two nearby matches is more of a possibility. Secondly, it seems that mobile apps facilitate better engagement throughout the day. Today’s eDater need not be in front of her computer to view potential matches, or to receive or send messages. Her phone is always by her side. Our engagement numbers regarding frequency and session length, described above, support this trend.
iOS and Android devices are versatile multi-purpose machines that have already significantly impacted the business models of music, games and other Media & Entertainment industry categories. And now, within the nexus of mobile-social-local, mobile dating apps appear to be looking for love in all the right places.
In this new age of mobile computing, the long-term success of Apple and Google depends largely on their ability to amass third-party developer support. Developer innovation improves the way consumers connect with others, entertain themselves, work, and more, all through apps. The more a platform provider can attract unique and superior content, the more appealing the hardware device appears to consumers prior to purchase and the more loyal they become afterwards.
Last week, Apple reported that it had sold a cumulative 200 million iOS devices. Currently the App Store contains more than 425,000 apps, with total downloads surpassing 15 billion. From the developer’s point of view, the most attractive aspect of the iOS consumer audience is that they all have credit cards on file with iTunes. This means 100% of them can seamlessly pay for apps and in-app purchases. All told, the App Store offers a powerful business opportunity to developers and has attracted leading mobile developer support.
At the same time, Google’s more open Android OS distribution strategy has garnered the support of numerous notable OEMs, spawning a rapidly growing installed base of Android devices that is gunning to overtake the iOS installed base. With broader distribution across more carriers, Android device activations surpassed 500,000 per day tweeted Andy Rubin last month. This growth is up from 300,000 activations per day reported just last December. In terms of apps, the Android Market has 200,000, and Google said it crossed the 4.5 billion downloaded application mark in May.
At Flurry, we regularly track developer support across the various platforms that compete for their allegiance. When companies create new projects in Flurry Analytics, they download platform-specific SDKs for their apps. Since resources are limited, the choices developers make in building for different platforms strongly signal their confidence in those platforms. They are literally investing their R&D budgets in the hopes of generating future revenue. In total, over 45,000 companies use Flurry Analytics across more than 90,000 applications. For this report, we compare Q1 to Q2 new project starts.
Studying the numbers, it’s readily apparent that Android has lost developer support to iOS. Specifically, Android new project starts have dropped from 36% in Q1 to 28% in Q2. Overall, total Flurry iOS and Android new project starts grew from 9,100 in Q1 to 10,200 in Q2. Of note, this drop in Android developer support represents the second quarter-over-quarter slide, which follows a year of significant, steady growth for the Google-built OS. Over the course of 2010, Android developer support had steadily climbed each quarter, peaking at 39% in Q4 2010.
Considering the events that could have precipitated this shift in developer support, Flurry has identified two probable causes:
1. iPhone Launch on Verizon: With iPhone’s arrival on Verizon in February 2011, three and half years after launching on AT&T, Apple closed the most significant vulnerability gap in its U.S. distribution, and likely worldwide. In fact, with its lengthy exclusive distribution agreement of iPhone on AT&T, it could be argued that Apple itself gave Android the opportunity to reach critical mass on other carriers, most notably Verizon. In that time, Google, Verizon and a host of OEMs worked hard and fast to push Android devices as an alternative to AT&T’s iPhone juggernaut. With Verizon’s launch of the iPhone, the pendulum appears to have swung back in favor of iPhone over Android development.
2. iPad 2 Launch: Establishing an installed base of more than 20 million tablet devices in less than one year, the iPad success story has been compared to taking a buzz-saw to the PC industry. Apple’s iPad shipments, from its last disclosed quarter, were higher than the initial first two quarters of iPad availability. Apple has additionally claimed that it is seeing the “mother of all backlogs.” Building efforts lag behind consumer demand for the device. We believe that wholesale consumer acceptance and adoption of tablets, which just a year ago was questionable within the industry, is further luring developers to build for iPad instead of Android.
While Android’s device installed base continues to surge, ongoing work to improve the Android Market layout and to push forward the adoption of Google Checkout are critical to its success. PayPal’s recent acquisition of mobile payment player, Zong, demonstrates that Google may not be enabling consumer payment quickly or well enough, which is inviting 3rd party competition and creating billing fragmentation. Furthermore, the development community is concerned about the rising cost of deploying across the Android installed base, due to the double whammy of OS and storefront fragmentation. With developers pinched on both sides of the revenue and cost equation, Google must tack aggressively at this stage of the race to ensure that Apple doesn’t continue to take its developer-support wind.
In 2006, European mobile analysts dubbed mobile the “seventh mass media channel” following print, recordings (e.g., albums, cassettes, DVDs, etc.), cinema, radio, television and the web. However, mobile failed to fulfill its promise. For mobile to have reached its true potential as a mass media channel, it needed to overcome slow and expensive carrier data networks, poorly managed carrier decks, and a heavily fragmented handset base which featured a myriad of small screens, weak processors, confusing user interfaces and clumsy WAP browsers. With so much friction in the channel, content creators were stymied in their ability to deliver compelling experiences to consumers, making mobile look far more like a niche than mass media channel.
Then, in 2007, the iPhone changed everything. In addition to unleashing a prolific media device, Apple wrested control of the storefront from carriers, convinced carriers to offer flat-rate data plans to consumers, tapped into blazing Wi-Fi as a pipe and shipped a useful mobile browser. Most importantly, they built a low-friction, robust channel through which content creators could distribute smartphone apps to consumers: the App Store.
In a few short years, with Apple as a game-changing catalyst, applications have already been downloaded tens of billions of times. Research firm, In-Stat, forecasts there will be 48 billion app downloads in 2015. With their success, apps already challenge the television in terms of reach and the Internet in terms of engagement.
For this report, Flurry used data from over 45,000 companies across their more than 85,000 applications. Flurry Analytics tracks over 15B user sessions per month across iOS, Android, BlackBerry, Windows Phone and J2ME.
Unprecedented and Accelerating Reach
The chart above shows the number of people actively using apps on their smartphones in May 2011 across the top five European markets. Flurry calculates active smartphones by first measuring its own penetration across these devices via apps into which Flurry Analytics has been integrated. For example, Flurry detects roughly 85% of all iOS and Android devices worldwide. We then grossed this number up, by country, for our estimates.
Combined, the top five European markets – the UK, France, Germany, Italy and Spain – actively use apps on 46 million devices each month. With a combined population of just over 240 million, for ages 13 and over, the addressable market through smartphone apps averages approximately 20% of the largest, most affluent European countries. Additionally, with a month-over-month growth rate (Compounded Monthly Growth Rate, CMGR) of more than 10% over the last two years, we project the installed base of smartphones will more than double over the next 12 months alone.
In the chart below, we show the smartphone app audience as a percentage of each top European country’s population, again ages 13 and over. The UK leads in penetration with a whopping 33% of its population using apps on smartphones per month. France places second with a sizable 20%, next followed by Germany, Spain and Italy coming in with 14%, 9% and 10%, respectively.
After having established the percent of each country’s monthly population that can be reached through smartphone apps, we next look at the pace of smartphone adoption, by country.
The chart above shows just how quickly the base of devices running smartphone apps is growing by country. While the UK and France are the most penetrated to date, as a percentage of their countries' populations, the laggard countries are closing the gap in terms of growth. Spain leads in growth of its active smartphone user base with a monthly growth rate of 14%. Germany and Italy’s active smartphone bases are both growing at 11%. Additionally, France and the UK continue to grow, month-over-month, by 7% and 6.7%, respectively.
With growing adoption of iOS and Android-based smartphones, the imminent release of Nokia phones based on Windows Phone 7, and the fact that the majority of consumers actively use applications, we predict that the growth of this mass market media channel will continue to grow until near total smartphone market saturation. To underscore just how aggressively this channel is growing, if we assumed the growth of smartphone adoption continued at their current rates, all five countries would have full smartphone penetration in just over two years.
Games and Social Networking Rule
Flurry tracks the total number of application use sessions, from when consumers start app sessions to when they end them, and groups these sessions into categories such as games, news and travel. The top categories ranked by session usage worldwide are: Games, Social Networking, Sports & Entertainment and News.
The graph below shows how consumer usage varies by app category across the top five European markets.
With the exception of Italy, the games category is the most popular app category across all countries. In Italy, the one country where the games category does not lead, Social Networking is the top category, with 38% of Italians using Social Networking apps compared to other categories.
Comparing each country’s proportion of usage by category, more consumers play games in France than compared to other countries – a massive 45% of all French app sessions are Games. In Spain, a greater percentage of the Spanish population consumes news compared to other countries, and the UK leads in relative Sports & Entertainment app consumption. In all 5 countries, the 4 top categories make up 80% of all traffic.
Solid App Retention and Engagement
In May 2011, the average worldwide 6-month retention rate for all apps was 36%. In other words, of all consumers who downloaded an app over the last six months ago, 36% had used that same app within the last 7 days of May (Flurry looks at “last 7 days” for its retention metric).
Continuing to look at the top 5 European countries, all have posted 6-month retention rates of greater than 30%. The chart below breaks out each countries 6-month retention rate compared to the worldwide average.
Reviewing the chart, we note that the UK leads in retention with 38%, followed by France at 37%, Germany at 34% and then Spain and Italy at 32% and 31.5%, respectively. Generally, we see a correlation between the maturity of a given market and app retention. We observe that consumers typically try several apps before they settle into using a group of favorites, which they then use several times per week, even per day. In less developed countries, we often see much more app experimentation. The five countries we review for this report are clearly all highly developed economies.
As a mass market media channel, smartphone apps not only reach a sizable audience today, but also continue to grow at staggering rates. The channel is already formidable with no signs of slowing. Smartphone app consumers are highly engaged and consider their smartphone among their most important personal possessions; we believe the 8th mass market media channel has indeed arrived in Europe.
On October 5, 2009, CBS canceled "Guiding Light," the longest running television drama in history, which began in 1952. Last month, CBS aired the last episode of "As the World Turns," the Proctor & Gamble production that has been running for more than 50 years. Ad dollars allocated to soaps fell nearly 30 percent from 2005 to 2009, and then fell another 20 percent in the first half of 2010.
Since the 90s, the television industry has been reeling from the disruptive forces of the Internet and DVRs. No longer could the industry depend on a captive audience to which it had grown so accustomed. While the industry has adapted its programming with a glut of cheaper, but profitable competition reality shows and edgier dramas to reclaim a loyal audience, a new entertainment force is once again driving disruption: the iPhone. The chart below illustrates how iOS social games, a popular form of gaming mixed with social networking, stack up against primetime TV viewership.
Social games on iPhone, iPad and iPod touch devices are competing for television viewers. In fact, these apps, tracked on the Flurry network alone, comprise of a daily audience of more than 19 million who spend over 22 minutes per day using these apps. Treated as a consumer audience, its size and reach rank somewhere between NBC’s Sunday Night Football and ABC’s Dancing with the Stars, and only 4 million viewers shy from beating the number one prime-time show on television, FOX’s American Idol.
However, Flurry is only seeing part of the picture. With Flurry integrated into more than 50,000 apps, out of Apple’s stated total of 250,000 apps, Flurry has about 20% penetration. Additionally, since this analysis focuses on only two categories of applications, social games and social networking apps, it’s clear that iOS devices are already ahead of prime time television’s hottest shows.
Given that the app store only launched in July 2008, these figures are staggering. Mass consumption of applications on mobile devices has exploded in record time. Also noteworthy is that the enormous audience these applications reach takes place every day, 365 days a year. Compared to a top television series, which airs 22 episodes a season, advertisers can reach a larger consumer audience through applications 15 times more frequently.
There are a lot of conclusions that can be drawn from this phenomenal shift in audience behavior. The most obvious is the impact on the advertisement industry, which has relied on the reach generated by its prime time television slot for years. This season, while Americon Idol is busy shuffling judges, the people have voted: iOS social games are as prime time as prime time television. Enjoy the show!
Flurry regularly monitors new project starts by developers within its system to gauge interest across mobile platforms. With over 20,000 apps started by developers within Flurry, we believe this provides meaningful insight on the platforms that most excite developers, and where current resources are being deployed.
Since Apple introduced the iPad in late January, Flurry noted a significant spike in developer support, indicating early excitement for the promise of the device. As April 3 draws near, developers continue to develop for the iPad at a fever pitch. Today Apple added a toggle switch to its online iTunes store that allows consumers to view apps available specifically developed for the iPad. About 2,000 iPad apps were listed upon our initial count.
Looking into our system, we break out iPad-specific developer support by new project. For reference, we compare this to pre-iPad ratios to demonstrate how much developer interest the Apple iPad is attracting. Specifically, we compare averages taken across 2009 vs. the last 60 days, pulled earlier this week.
Comparing the two pie charts, the first notable difference is that iPad made up 22% of new projects starts within Flurry over the last 60 days. In March, over 3,000 unique applications were created within Flurry. A second point of interest is that Android's share of new project starts has decreased from 18% to 10%. However, it should not be concluded that Android developer support is on the decline. In fact, the opposite is true, as we count approximately 300 new Android projects in March, which represents a 50% increase over February. Android's percent has declined because iPhone and iPad growth is increasing at a rate faster than that of Android. In short, more developers are building more apps. The total pie is growing significantly, month over month. A final note is that relative support for Blackberry continues to diminish. While not shown in the chart, we calculate 1% share for Blackberry over the last 60 days, down from 4% for the whole of 2009.