The US Federal Trade Commission (FTC) today released a study of privacy and mobile apps for kids. The report was a follow up to an earlier study issued in January. Both reports were highly critical of app developers and app stores. Both found that parents weren't given enough information to assess privacy policies and whether or how their kids' information was being used.
The FTC looked at 400 apps (randomly selected) that were directed toward kids. The agency compared privacy policies and actual practices. It found:
[The] industry appears to have made little or no progress in improving its disclosures since the first kids’ app survey was conducted . . . most apps failed to provide basic information about what data would be collected from kids, how it would be used, and with whom it would be shared.
In a few cases privacy policies were directy contradicted by actual practices and the FTC called these apps deceptive and potentially illegal.
The report's findings are interesting and potentially important for the debate over mobile privacy. However the specific finding I want to focus on here has to do with the number of apps that transmitted location information to ad networks.
Mobile apps (for kids) that share information with developers and ad networks
Only 3% of apps that transmitted information back to developers and ad networks shared location data. The iPhone makes that process more explicit than does Android. But when location isn't shared there can't be any location-based ads.
Apps for kids aren't ncessarily representative of the entire universe of apps. Indeed, location may be much less of a factor in apps for kids. But the data may be directionally consistent with the market as a whole, inducating how relatively few apps today offer opportunities to display location-based ad inventory.
You can't turn on the TV, Internet or open a publication without encountering an ad for Windows Phones. And there are conflicting data about whether it's working and the corresponding strength of Windows Phone sales.
Several data sources continue to indicate tepid demand in North America but there is also some evidence that Windows Phone sales may be going reasonably well in certain parts of the world. The blog WMPoweruser identifies growth in the usage of Facebook apps for Windows Phones and extrapolates an increased sales trend on that basis:
Using the number of Monthly Active Facebook users as a guide, we can see around 627,000 MAU of the built-in Facebook app has been added since the 1st October 2012, the start of the quarter.
Last year over the same period less than 150,000 was added by the 15th December, possibly hinting at the source of Steve Ballmer’s statement that “Windows Phones are so far selling at four times the rate of the same time last year” Last year according to Gartner, who claims to measure units actually sold to end users rather than shipments, said 2.759 million Windows Phones were sold in Q4 2011.
The data suggests already 7 million Windows Phones were sold so far this quarter, and we may finally be heading to a + 10 million Windows Phone quarter.
If in fact Windows Phones were to sell 10 million units to end users it would indeed be a breakthrough for the beleaguered platform. However there's other data to suggest that Windows Phones are not doing as well as that. For example, the most recent comScore US mobile market share data show that Windows continues to lose overall share to iOS and Android:
There are also recent sales data from Kantar Worldpanel that show Windows Phones losing share in accordance with the comScore data above:
However in Europe Windows Phones are making some inroads, probably as a result of Nokia's promotional efforts and legacy brand strength. While the EU5 shows a 4.7 percent market share (growth of 1.7% vs. a year ago) individual countries vary widely.
In Italy, Spain and the UK Windows Phones have performed better than in Germany and France. In Italy in particular Windows Phones have gained almost 8 points and now stand at an 11.7 percent share of recent sales according to Kantar. Again, this is probably on the strength of the Nokia brand in Europe.
Elsewhere around the world Windows Phone sales appear to be modest. However in "urban China" Kantar says Windows Phones contstitute 4.2% of all recent smartphone sales.
It is possible that all these sales combined represent several million units around the world. But while there does seem to be momentum in certain countries it doesn't yet appear that this is a 10 million unit "breakthrough quarter" for the operating system.
Flurry Analytics has been chronicling the rise of the app ecosystem and the growth of app usage by consumers for several years. In January of this year the company released data arguing that daily time spent with mobile apps had surpassed the PC internet: 94 minutes vs. 72 minutes per day. And earlier today Flurry released an analysis of US consumer time spent with mobile apps vs. television.
Ad network InMobile asserted earlier this year that consumers are now spending more time on a daily basis with mobile media than they do with TV:
[M]obile ranks first in media consumption among Americans with 2.4 hours of the 9 hours spent consuming media on mobile devices—this is more than a quarter of time spent on mobile, outpacing TV (2.35 hours), PCs (1.6 hours) and any other channel.
However according to the data compiled by Flurry, consumers are spending 127 minutes per day with mobile apps compared to 168 minutes per day with TV. TV time is basically flat, or slighly down according to Nielsen, while app-time is gaining according to Flurry.
Nielsen itself says that people in the US spend roughly 4 hours and 18 minutes per day on average with conventional TV (vs. 168 minutes [2.8 hours] in the Flurry graph). That would be about 2X of the time spent with mobile apps, using the Flurry figures.
The question of whether time spent with mobile already exceeds TV time or closing in on it is largely symbolic. The larger point is that consumers are highly engaged with mobile devices and the mobile internet. That trend will only continue to grow and gain in the next several years. Mobile ad spending, however, is nowhere near commensurate with the kind of time and attention that consumers are spending with mobile media. The chart below (also courtsey of Flurry) illustrates the huge disparity between the two.
Mary Meeker has argued that, based in part on this familiar time-spent formula, mobile advertising is basically a $20 billion opportunity in the US. That may be the case eventually -- though advertisers and their agencies aren't totally "rational." But in the near term are many barriers to the free flow of ad dollars into mobile right now: organizational politics and culture, lack of advertiser education, lack of budget and perhaps most of all lack of "clear ROI."
It took a very long time for online advertising to attract the kind of ad dollars that were more or less consistent with consumer time spent online. It won't take quite as long for mobile to ramp. But it could still be a number of years before mobile marketing and advertising are significant budget items for the majority of advertisers.
For their part consumers are mostly indifferent to whether or how soon companies embrace mobile marketing and advertising. While they prefer mobile friendly sites and user-experiences they don't particularly care if marketers are fully exploiting mobile ad opportunities.
However, if marketers do not as the Thanksgiving holiday weekend has already proven, it will be their missed opportunity.
Former Morgan Stanley financial analyst, now KPCB partner, Mary Meeker did one of her patented blizzard of stats/data dump presentations at Stanford University the other evening. The slides (available here) are essentially an updated version of a presentation given earlier this year.
You know most of the material by now. However, below are the most interesting slides I culled from a much longer set. They go to device adoption and mobile ad revenue projections.
The noteworthy thing about the above chart is that it argues there are 172 million smartphone subscribers in the US. If that's true it would mean a smartphone share of something like 68% or 73% depending on the base used. This is undoubtedly high. But it's not unreasonable to argue that there may be 60% smartphone penetration by the end of Q4 in the US (or early Q1).
From the chart below: there may not in fact be 5 billion individual mobile phone users around the world. There are "only" 7 billion people on the planet. It's probably more accurate to assert there are something like 5 billion subscriptions/SIM cards (there are some dual subscriptions). Still the global smartphone growth opportunity is massive.
The following chart is based on Pew survey data, showing that 29% (as of earlier this year) of US adults owned a tablet or eReader. Tablets are going to be the number one electronics gift item this year. We could be looking at 80 million total tablets in the US in Q1 2013.
What's most interesting about the slide below is that it projects tablet ownership to pass PC ownership by the end of next year; in other words: more tablets than PCs. This may be a aggressive forecast but it's not out of the question.
The final slide is about mobile advertising and app revenue. There are many sources behind this projection. It envisions a $20 billion global market by the end of the year, with mobile advertising around $6 or so billion.
US mobile advertising was worth roughly $1.2 in the first half and is on track to be somewhere between $2.6 and $2.8 billion for the full year 2012. Globally mobile ad revenues will probably reach between $5.5 and $6 billion by the end of Q4 this year.
Social networks and social-mobile apps are undeniably mainstream at this point. Indeed, mobile is where much of the growth is happening for social media. A new report, compiled from Q2 data and issued by Nielsen, illustrates this and compares time spent and access by media device.
What the data show is that the amount of time people are spending with mobile devices (vs. PC) is growing and that mobile apps continue to be where mobile time is concentrated. Along with smartphone and tablet penetration, mobile time overall has grown vs. 2011 but growth has been concentrated in mobile apps. They see roughly 79% of consumer time with mobile media and the mobile internet.
Mobile media time overall is now roughly 43% of the time spent on PCs as of Q2 2012.
Mobile use of social networks tends to show slightly higher levels of engagement than on the PC. In mobile, as on the PC, women tend to be more engaged than men. But the most engaged groups are slightly different in each category.
The most engaged group of mobile social media users is the 25 - 34 age range, whereas on the PC it's the 18 - 24 year old cohort.
The following chart illustrates that among the major social sites, Facebook dramatically leads in terms of time spent (although Instagram isn't present on this list). In addition, time is roughly divided 85% mobile apps vs. 15% mobile web. And while the ratios are slightly different for each social media publishers the directional trend is the same -- toward mobile apps.
Nielsen also looked at the major ways in which consumers connect to the Internet generally. It found that the PC was still the dominant way but that PC penetration was down slightly since a year ago. By contrast, as you might expect, mobile access to the Internet has grown significantly on smartphones and especially on tablets.
Marketers who continue to ignore or only nominally address smartphone and tablet users -- especially app users -- are losing access to an increasingly large user base and may be doing their brands and reputations harm in the process.
Numbers are everywhere as we head into the final month of 2012 -- an undisputed "year of mobile" -- and many sources have released loads of market share and device penetration figures over the past week. Some of those numbers are meaningful and some are not.
Among them ad network Millennial Media put out some monthly device figures this morning, based on ad impression share on its network. I'll take a quick look at those numbers and then discuss some of the other recent device data in the market, with an emphasis on tablets.
The iPhone is the single most prevalent device (and has been so for several years) on the Millennial Network. It generated 16% of all the ad impressions in Q3, while iOS devices in total generated 31% of all Millennial's ad impressions. Collectively Samsung devices (phones, tablets) were responsible for 24% of impressions; the second most prevalent device OEM.
RIM devices were responsible for 7% of ad impressions, which is now basically on par ith the company's overall market share in the US. There are no Windows Phones in the top 20 on Millennial's network. Windows Phones (Lumia in particular) has sold reasonably well in select countries in Europe (i.e., Spain, UK, Italy). However they have not sold well in the US.
While Apple is the leading manufacturer and has the leading device on the Millennial network, Android devices dominate collectively -- with 52% of all impressions, compared with 34% for iOS. This share breakdown is almost identical to comScore's September US smartphone market share data.
Finally Millennial ranks the top tablets on its network (see graphic above). The iPad leads, followed by the Samsung GalaxyTab, Kindle Fire and others. Tablets will clearly be one of the most popular holiday gifts and the top electronics item sold in Q4.
It's curious to see the Acer and Motorola tablets on Millennial's list. From a sales and traffic standpoint there are now effectively three tablets in the market: the iPad (and Mini), Google's Nexus tablets (mainly the Nexus 7) and Kindle Fire devices. While the Nook and Galaxy Tab have some market presence they're essentially "also-rans" at this point. The Galaxy Tab has had greater success in Europe.
A new report from ABI Research claims that the iPad's share (of shipments) fell to 55%, down 14 points in Q3. Lower-priced tablets from Google-ASUS and Amazon are driving a lot of sales to be sure. Indeed, Amazon made the claim earlier this week that Kindle device sales more than doubled over last year.
But collectively we need to get rid of "shipments" as a market-share metric. It's widely used because it's easier for analyst firms to track than actual sales. However it's not meaningful in any sense. As an industry we need to shift to actual device sales or even other metrics such as web traffic/transactions. This past weekend's data have shown this.
What do sales matter if devices aren't widely used or are used for very limited purposes. For example Kindle Fire devices, though they're selling well, are essentially used to consume Amazon content. They don't show up very often on internet traffic reports. And while the impact of Nexus devices has yet to be fully felt, the broader notion (promoted by the ABI report) that Android tablets now constitute nearly half the devices in the market is misleading.
As widely discussed earlier this week, the iPad is the only tablet right now that appears to matter in a "real world" sense. According to this weekend's e-commerce data from IBM, the iPad generated 88% of tablet traffic on Black Friday and more than 90% on Cyber Monday.
In Q2 ad network Chitika found that the iPad was responsible for almost 95% of the tablet traffic on its network. Other publishers and e-commerce sellers report similar results: so far the iPad is the only tablet that matters.
E-commerce site Fab.com has said that 95% of its mobile sales come from iOS devices. And tablet content platform Onswipe has said that the iPad is responsible for a remarkable 98% of all tablet-based traffic to the company's publisher partner network. Based on global web traffic data from Q2 this is what actual usage market share looks like:
Despite Android's dominance in terms of device penetration the majority of mobile web traffic in the US (not to mention transactions) is coming from iOS devices. And when it comes to tablet traffic alone, there is no Android surge.
There may be a lot of Android tablets out there but engagement and usage levels are far below the iPad.
As part of General Motors' MyLink in-dash telematics system (GM's answer to Ford's Sync), the Chevrolet division is incorporating Siri access into two 2014 models: Spark and Sonic vehicles.
Users with iPhones will be able to use Siri to execute a number of commands:
Siri's full capabilities won't be incorporated at this point however. Anything that requires a visual display of data won't be available so as not to create safety hazards while driving. Siri and the iPhone connect to the MyLink system via Bluetooth.
MyLink is designed to be broadly integrated with iPhone and Android devices. The console operates very much like a small tablet device embedded in the dash.
The MyLink "infotainment" console is already modeled on the smartphone apps metaphor. MyLink also has a built in virtual assistant, which will operate in those models that don't enable Siri access. It will also remain available to drivers in the Siri-enabled Spark and Sonic vehicles as well for a broader array of functions than what Siri will permit.
What's perhaps more interesting than the integration of Siri is the adoption of the concept of the virtual assistant more broadly. My colleague Dan Miller is about to publish a report on "PVAs" (personal virtual assistants) and their impact on a range of use cases including enterprise customer care. Built on decades of speech processing research and technology development, as well as advances in "AI," virtual assistants are changing the way we "search" and interact with devices and technology.
The following video demonstrates MyLink's features.
There's lots of news today about the role mobile is playing in the just-started holiday shopping season. Most notably IBM reported a couple of days ago that on "Black Friday," mobile buying "soared with 24 percent of consumers using a mobile device to visit a retailer's site, up from 14.3 percent in 2011. Mobile sales exceeded 16 percent [of online commerce], up from 9.8 percent in 2011."
But even more noteworthy than the increasing role that mobile is playing in holiday shopping, is the discrepancy between iOS and Android in terms of web traffic and user purchase behavior.
Call it the "Android paradox." In the US Android handsets represent 52.5% of smartphone market. Apple's iPhone holds 34.3%. The share that is controlled by iOS is larger when the iPad is factored in but Android is the dominant OS in the US and globally.
When you look at mobile internet visits, however, the relationship shifts -- with the iPhone and iOS driving much more web traffic than Android. Apple's devices also generate much more in the way of e-commerce sales vs. Android. Website Fab.com reports that 95% of its mobile sales are coming from iOS devices.
IBM reported that 58% of consumers (of the 16% who bought something on a mobile device) used smartphones to shop for deals, while 41 percent used tablets. Here's how the traffic distribution broke down on Black Friday in the US:
The iPhone and iPad combined for the bulk of mobile shopping, while on the tablet side the iPad generated 88% of the traffic in its category. There's something very strange about the fact that iOS users generate much more internet traffic and mobile buying than their Android peers -- given that there are more Android users out there.
There have been various attempts to explain this traffic and commerce discrepancy, chief among them the theory that Android owners are less sophisticated, affluent and engaged. While there's clearly some validity to this theory it doesn't entirely explain what's going on.
One of the most eagerly sought electronics products this year is the tablet. We should see millions of them bought over the holidays. Indeed, tablets will be an enormously popular gift item. But which one(s) will be successful and which ones will fade?
Today, for "Cyber Monday," Amazon is promoting the upgraded Kindle Fire (with special offers) for $129 vs. its normal $159 (reduced from last year's $199). This should generate quite a few sales.
However the Kindle Fire is not as popular on Google as the company's own Nexus 7 or the iPad Mini. According to data released by Google earlier today the following are the Top 10 Google Search Shopping Queries (today):
Meanwhile PriceGrabber shows a somewhat different list of "most searched" electronics products:
Both of the above lists indicate the Nexus 7 is the most "searched for" tablet out there -- even the most popular product. However, over at Amazon Kindle Fire and other Kindle devices dominate the electronics bestseller list.
Finally, a recent consumer survey Opus conducted (n=1,048 US adults) asked "Are you planning to buy a tablet computer this holiday season?" Here were the results:
In our survey Nexus 7 was the least desired of the tablets and iPads were the most popular. All this data seems to suggest that iPad, Nexus 7 and Kindle Fire will do well, while Surface, Nook and other "no name" tablets will generally be ignored and suffer.
There's a relatively common perception that "daily deals are dead." What's more accurate to say is that the daily deals "bubble" has burst and consumers are burned out on push email marketing, where many of the deals are irrelevant to their interests or needs. But it would be inaccurate to say that "deals are dead."
Coupons and deals remain popular among consumers and mobile users in particular. According to data from Nielsen, xAd and Telmetrics, the three top reasons that a mobile user would engage with an ad are the following:
Consistent with the findings above, "search for/receive mobile offers" (especially locally relevant ones) is one of the top three "mobile commerce" activities that users engage in according to 2012 data from the US Federal Reserve and JiWire. They also search for coupons on smartphones while in stores according to multiple surveys and behavioral studies.
A new set of data from Nielsen tries to identify where mobile users get those deals and coupons. A majority get mobile vouchers from retailers directly (sites/apps), followed by deal of the day sites/apps.
Among the daily deal apps Nielsen found that the "usual suspects" were the most often used: Groupon, LivingSocial, Google Offers and AmazonLocal (LivingSocial). Amazingly, of those who have sought out daily deals on their smartphones, 91% have done so through the Groupon app.
This shows that relatively few daily deal vendors have any brand awareness and usage beyond these major sites. But among them Groupon is far and away the leader.