When I first saw this GigaOM post about Morgan Stanley's Mary Meeker's mobile data I thought it was simply a rehash of the Q4 discussion she put out about the mobile Internet. But it's apparently based on some updated projections in a new "Internet Trends" slide presentation.
Below is the "money slide," showing that the global crossover point for the PC and mobile Internet is 2014 in the firm's estimation. In other words, when the two switch places -- when more people (on a global basis) will access the Internet via mobile devices than on PCs.
Given that in some developing countries this is already the case, it's quite a safe prediction to make. In the US or EU the crossover is unlikely to happen quite as soon, though it likely will happen at some point in the next decade and maybe earlier rather than later.
Right now companies like Google say that mobile devices complement and don't cannibalize desktop PC usage: night and weekends vs. during the day. In addition the iPad has emerged as something of a "weekend" device, at least at this early stage. (I use mine daily.) It might be more accurate to say it's something of a "lesiure" device, at least more so than smartphones and PCs.
We agree however with Meeker's conclusion that mobile devices will be primary and PC devices will become secondary over the next decade. And, as faster networks kick in, that will only accelerate the trend.
US mobile-only households are now 22.7% of the total population according to the US CDC. Arbitron has compiled an interesting map showing what that actually looks like geographically (in Arbitron radio markets). We'll continue to see landlines disappear to the point where by 2015 roughly 40% - 50% of US households may be mobile only.
This trend has a number of implications, including for the directory assistance (DA) industry. Increasing percentages of 411 calls come from mobile phones. As people adopt smartphones, DA calls decline -- because people have access to the mobile Internet and specialized apps that provide more information and greater control over information.
Below is a graphic of the Arbitron map:
You can download the map from the Arbitron site (linked above).
Here are the numbers Apple released during its iPhone OS 4 event yesterday . . .
iPhone/iPod Touch (85 million devices):
Mobile browser usage (Net Applications Feb data):
ComScore released a bunch of European mobile usage data earlier today that shows the UK leading the five major countries of Europe in mobile Internet access (30.8%). If we consider apps to be "mobile Internet" the numbers go quite a bit higher.
The data also show dramatic growth in smartphone adoption across Europe, especially in the "low to mid tier" of the market:
The U.K. market strongly leads in growth of smartphone adoption over the past year, growing 70 percent to more than 11 million subscribers. France ranks second in growth with the number of smartphone subscribers up 48 percent to 7 million. Meanwhile, Italy boasts the largest number of smartphone subscribers overall (15 million) but showed the softest growth in this market at 11 percent.
Here are the charts:
Smartphone ownership is synonymous with mobile Internet access; however the groups that do access the Internet are broader than simply smartphone owners. However engagement and frequency are much greater among smartphone owners.
Nielsen has predicted that smartphone ownership will cross the 50% threshold in the US in 2011 by Q3. I believe that to be too optimistic a prediction. However it could happen with aggressive pricing on handsets and plans.
Experian released top-line results of a mobile consumer survrey as part of its "Spring New Media Study." There's nothing strange or startling here but the findings are interesting and worth reporting nonetheless.
The study finds that 87% of US consumers now own mobile phones and 31% have accessed the Internet from a mobile handset in the past 30 days (or roughly 78 million people). CTIA says mobile penetration in the US is now at 91% by comparison.
Another Experian finding is that mobile users engage with other media at the same time. Or, perhaps more precisely, users of media simultaneously engage with mobile devices: "TV is the most common media distraction with 21% of mobile phone owners watching TV while using the phone."
Here are a few graphs illustrating some of these findings:
Opera released its State of the Mobile Web report for February. The data reflect usage of the Opera Mini and Mobile browsers, the handsets using them and the sites visited by Opera's users. Below are a few data points from the report and several of the charts for China, UK and the US markets:
Compare data from the same time last year:
As you can see there's not a huge difference from February 2009 to 2010 in terms of sites visitied.
Nielsen is saying now that "21% of American wireless subscribers are using a smartphone as of the fourth quarter 2009 compared to 19% in Q3 2009." That would mean that there are currently almost 60 million smartphones in the US, if the number can be extrapolated to the entire mobile subscriber base.
While I believe that we're very close to 20%, the Nielsen figure is slightly too high when considering the entire market. Nielsen also projects that by Q3 2011 smartphones will become the majority of handsets in the US market.
I think this prediction is also a bit aggressive, at least a year too early. While an increasing number of feature phone owners say their next handset will be a smartphone -- "in the last six months and 45% of respondents to a Nielsen survey indicated that their next device will be a smartphone" -- it won't be until 2012 or early 2013 when we cross the 50% smartphone threshold.
AdMob put out its February data early this morning. Among the things its shows -- as an indication of future industry trends -- is:
First it must be repeated that the data AdMob gathers is from its network and it does not represent an objective view of the mobile Internet as a whole. Still the trends are going to be broadly consistent with the mobile market and Internet more generally.
To that end, I see several things that are interesting about where the market is headed. First: the overall traffic trends on the AdMob network; smartphone share growing (48%), so is the share of MIDs:
Smartphones are now approaching 20% of the installed user base in the US. Smartphones and quasi-smartphones will likely come to be dominant (51%) in 3-5 years. In terms of MIDs, here's what AdMob says:
The mobile Internet devices category experienced the strongest growth of the three, increasing to account for 17% of traffic in AdMob’s network in February 2010. The iPod touch is responsible for 93% of this traffic; other devices include the Sony PSP and Nintendo DSi. In absolute terms, mobile Internet device category traffic increased 403%.
If the iPod Touch is the proof of concept, the iPad will spur growth in this category. There are probably going to be 10 relatively high profile tablet devices in the market. All of them will offer browsers (ultimately) and fall into this MID category. The iPad is likely to be the leader but we'll see.
The challenge with these tablets is how to count and account for them. Are they like laptops without the physical keyboard or are they more like smartphones? Do ads on the iPad, for example, count as "mobile" or will they be counted as Internet ads? It will probably depend on whether the ad is in-app or mobile Web. Even then there will be new ad units for these devices. The use cases for MIDs/tablets will be varied and interesting to watch develop.
Here's market share data for February 2010 and immediate below AdMob data from a year ago:
Here's the breakdown:
Among other things what these data show is a three or four way race for smartphone dominance among iPhone, Android, RIM (in the US) and Nokia (internationally). Look in particular at the traffic declines for Nokia, as a percentage of overall AdMob traffic. Palm is dead unless there's a miracle of some sort. And the new Windows (7) Phone isn't out so we can't assess its prospects yet.
According to a new survey (n=1092) of US BlackBerry, iPhone and Android users, by Crowd Science iPhone and Android users display almost comparable levels of loyalty to their devices. The firm said "Android users [rival] iPhone users in loyalty, with about 90% of each user group planning to stick with their current brand when buying their next phone."
BlackBerry users had comparatively weaker loyalty with "nearly 40% of Blackberry users ... prefer Apple’s iPhone as their next smartphone purchase, but a third of them would also switch to the Android operating system." The survey also found that more iPhone and Android owners use their handsets for personal use vs. BlackBerry owners:
Here's the graphic depicting the answer to "Which phone would you purchase tomorrow?":
What the chart shows is that 92% of iPhone users would buy the iPhone, while 87% of Android owners (small sample) would buy Android handsets and 39% and 34% of RIM owners would buy an iPhone or an Android phone respectively vs their current BlackBerry handsets.
The Android sample was quite small but it indicates that Android is delivering satisfaction levels that have the potential to blunt the iPhone's future growth. This development also suggests that Apple's own loyalty to AT&T has become strategic mistake as more consumers become comfortable with Android handsets that they can obtain from their existing carriers.
RIM, for its part, needs to boost the consumer appeal of its devices fairly quickly -- something the company already clearly understands.
Android has seen some impressive growth over the course of the past quarter, according to new numbers out today from comScore. CTIA counts over 270 million mobile subscribers in the US; comScore argues there are 234 million ages 13 and older. Here are the subscriber figures for the four largest US carriers:
There there isn't likely a causal connection, Android's gain is just a little greater than WinMo's loss.
Here are the big data points from a usage standpoint in the chart below:
You can see in these numbers very directly the caparative reach of each of these "platforms."
If we use a compromise figure of 250 million mobile subscribers, then number of mobile Internet users in real terms would be 71 million people in the US.
Top US handset makers:
Recent ChangeWave survey data shows considerable demand for the forthcoming iPad and, interestingly, a wave of "buyer's remorse" among some of those with other tablets and eReaders. According to the survey of "3,171 consumers, conducted in the aftermath of that Apple announcement (Feb 1-10)," 57% of eReader owners are either uncertain about their purchase or would have bought an iPad.
Here are the data:
Here's ChangeWave's "bottom line":
While the iPad launch is likely to strengthen overall e-Reader demand, the survey suggests Amazon and its competitors could well find themselves relegated to playing catch-up within just a few quarters if they don't preemptively move quickly to upgrade their own e-Readers.
Building and optimizing a site for the "mobile Web" is a lot more difficult than doing so for the PC. You've got a conventional HTML site, which may not work if it's flash-heavy. Then you've got apps, which publishers and brands may or may not need, and then you should have a "touch-friendly" iPhone-optimized mobile site.
Most sites are not well designed for the mobile Web and many marketers are simply unaware of how critical this is becoming. Gomez, in a self-serving way, has documented that poor mobile performance can affect sales and have a negative impact on brand impression.
Mobile browser Taptu now has released a report that analyzes the degree to which sites are set up and optimized for what it calls the "touch Web" -- basically for smartphones with touchscreens. The company examined 113 million sites and found that roughly a third were "touch-friendly."
By category, here's Taptu's breakdown of the percentages of sites that are touch-friendly:
Taptu defines "higher quality sites" as those "which as used as the basis of our category-level analysis are defined as those with above average quality score for either visual quality or information quality."
The shopping sites are best positioned, with social networks not far behind. Mostly that means Facebook, MySpace and Twitter. Facebook is very well set up for mobile of course, across devices and platforms. What's a bit surprising is how poorly configured the "places, travel & local" category is. Only 9% of "higher quality" sites in the category are optimized for touchscreen smartphones. Yet this is content heavily used by mobile subscribers with data plans.
Over the next 12 months every major brand and publisher will need to upgrade for smartphone owners.
If these Quantcast numbers are correct they provide some additional insight into why Apple may have sued HTC (and Android/Google by proxy): its growth has stalled and Android is accelerating. Partly this is about AT&T exclusivity in the US. It's also about Android flooding the marketing.
Android is growing from a smaller base so its percentage growth is going to be much higher. The decline in iPhone growth reflects that everyone who is likely to move to AT&T to get the iPhone has already moved and people are now opting for "good enough" Android devices that are becoming available from their existing carriers.
Here are the Quantcast charts:
The figures above actually show a higher iPhone mobile Internet share than other data vendors.
The Pew Internet project has come out with a report, which I've written about at Search Engine Land and Screenwerk, on digital news consumption. It's based on US consumer survey data. Below I summarize the mobile news portion of the report.
Overall, 26% of American adults say they get some form of news via cell phone – that amounts to 33% of adult cell phone owners and 88% of adults who have mobile internet.
The typical on-the-go news consumer is a white male, age 34, who has graduated from college and is employed full-time.
Among this subgroup of internet-using mobile phone users, we found that the vast majority get some kind of news online:
- 72% check weather reports on their cell
- 68% get news and current events information on their cell
- 49% have downloaded an application that allows them to access news, weather, sports, or other information on their cell
- 44% check sports scores and related information on their cell
- 35% check traffic information on their cell
- 32% get financial information or updates
- 31% get news alerts sent by text or email to their phones
- 88% say yes to at least one of the above
Source: Pew Internet Project 1/10 (n=2,259 adults)
No surprises here, news is one of the top mobile content categories. The report overall shows a multi-platform news enviornment where people are looking at news in traditional media, online and in mobile.
The "Internet" is now the third most common news source, outstripping traditional newpapers and radio (following local and national TV). Online, portals and aggregators are the dominant sources of news for consumers.
Millennial Media released its January SMART report, which offers a range of data about activity and ad campaigns on its network. Here are a few of the top-level datapoints and findings:
The January report also republishes InsightExpress data about the greater efficacy of mobile marketing and advertising (vs. online):
According to Millennial's discussion of the InsightExpress data:
Mobile campaigns in the Retail Vertical showed the largest differences between online norms in three of the ﬁve categories, Aided Awareness, Purchase Intent, and Unaided Awareness, with index scores of 14, 7.9 and 5.7 respectively, according to InsightExpress.
The Travel, Automotive and Technology campaigns had similar increases above online norms in the Mobile Ad Awareness category with index scores of 4.8, 4.7 and 4.6. For advertisers, this is a potential positive indicator that consumers are more aware of advertising in these verticals. CPG campaigns indexed high in the Brand Favorability category with a 11.3 index score. The second best index was 7.0 for Automotive campaigns. In our Q4 Top 10 Mobile Ad Verticals, CPG ranked seventh while Automotive ranked tenth.
This better performance of mobile (vs. online) makes sense because of reduced ad clutter in mobile, the greater share of voice and the greater novelty of mobile advertising (so people notice). As mobile becomes mature some of these metrics may decline -- but that remains to be seen.
According to the latest State of the Mobile Web report from Opera, Google enjoys mobile search dominance in numbers generally consistent with its lead and share on the PC Internet. Yahoo!, however, is stronger in mobile than it is on the PC. Bing has a tiny presence by comparison.
One thing to keep in mind, however, is that these data are drawn from Opera Mini users and don't capture the iPhone and most activity on the other smartphone platforms. However I can tell you that directionally it's the same on most smartphone platforms.
Below are the customary data from Opera on top sites and handsets. The search share data are at the bottom. The full report is available here.
Opera has developed a version of its mobile browser for the iPhone and will be submitting it for approval shortly. It was demonstrated at 3GSM in Barcelona and received rave reviews. Apple will have a potential anti-trust issue in the US and Europe on its hands if it declines to allow third party browsers on the device.
Gartner has come out with its full year 2009 smartphone data. According to the IT consulting firm, Apple has displaced Windows Mobile (now Windows Phone) as the global number three player. RIM and Android also showed solid growth. According to Gartner:
The two best performers in 2009 were Android and Apple. Android increased its market share by 3.5 percentage points in 2009, while Apple's share grew by 6.2 percentage points from 2008, which helped it move to the No. 3 position and displace Microsoft Windows Mobile.
Here are the marketshare charts by hardware OEM and operating system:
Compare recent IDC smartphone estimates. Both IDC and now Gartner contradict Nokia's claim that it grew marketshare in Q4 2009.
Window (Mobile) 7 was unveiled at Mobile World Congress to much fanfare but won't be out until "holiday 2010." That means that Window Mobile's slide will accelerate as buyers either abandon or wait for the new OS to come out.
That headline might have overreached a tiny bit, but Mediamark has found in its survey research that US teens now text more than send instant messages on the PC. Though it should come as no surprise, this is apparently the first time it's happened according to the firm:
Some 57% of teenagers report they text messaged on their cell phones in the last 30 days, compared to 42% who instant messaged on a computer in the same time frame, according to the TeenMark study . . .
The number of teens who text has increased 50% since 2007, vs. a 13% decline in the number of teens using instant messaging. Texting is now the top feature teens use on mobile cell phones, aside from making phone calls.
Millennial Media has compiled a number of top lists from 2009 and put them together in a year in review report. The data are drawn from Millennial's own network and associated ad campaigns but the company says "Millennial Media is the largest mobile ad network, [so] we anticipate much of this data is fairly representative of the mobile ad industry as a whole."
Here are a few of the lists (covering all of 2009):
Campaign distribution by objective:
Growth of mobile sites/applications (YoY): 117%
Advertiser growth (YoY): 54%
Top handsets by share of impressions:
Percent of advertisers using rich media in mobile: 17%
Top ad spending "verticals" in 2009:
Compare the IAB's top online spending categories/industries:
Here's Millennial's December report for comparison.
Electronics comparison site Retrevo conducted an online survey (n=1,000) of US adults earlier this month, regarding mobile shopping and receptiveness to mobile advertising. The data are generally consistent with our data and other information in the market; consumers increasingly use their phones as shopping aids/tools but are ambivalent toward mobile advertising. (One note: attitudes and behavior don't line up in the discussion of mobile ads.)
Younger users were generally more "advanced" in their behaviors and receptive to mobile advertising. To see the full results and Retrevo's discussion go here.
Q: Have you ever used a mobile phone to research products, compare prices, find retailers or to shop?
Source: Retrevo (2/09, n=1,000)
Q: Have you made a purchase using a mobile phone?
Source: Retrevo (2/09, n=1,000)
Q: Have you ever responded to an advertisement on your mobile phone?
Source: Retrevo (2/09, n=1,000)
The top chart, about using the handset during shopping, is the one to focus on. We can qualify all the findings as perhaps being not entirely representative of the mainstream shopper, etc. However, we will see huge numbers of people using handsets for research and other information (looking for deals?) during the shopping process.
Much of the so-called "mobile commerce" is going to be about finding the right product for less online: I confirm I want it in the store and buy it for less on Amazon, for example. This scenario may eventually become a problem for retailers and boost e-commerce, ironically.
Ads that are relevant and timely (think coupons, deals, discounts in shopping) will also succeed despite apparent consumer hostility.
This forecast apparently consists of virtual goods payments and actual mobile buying of conventional goods. The former is a big market getting bigger. The latter will grow but the $119 billion figure is very aggressive. Dominant scenario is reflected the first chart above: using the phone to research, check prices -- not buy via mobile.