Mobile App Usage Increases In 2014, As Mobile Web Surfing Declines

New data from app analytics provider Flurry released today states that native app usage on smartphones is continuing to grow at the expense of the mobile web. The company claims that users are now spending 2 hours and 42 minutes per day on mobile devices as of March 2014, up from 2 hours, 38 minutes as of a year ago. Meanwhile, mobile app usage accounts for 2 hours and 19 minutes of that time spent, while mobile web usage has dropped from 20% of the U.S. consumer’s time in 2013 to just 14% – or 22 minutes per day – as of last month. Says Flurry CEO Simon Khalaf, the changes indicate that the mobile browser has become just “a single application swimming in a sea of apps.”

Flurry, which gathers its data from its network of over 450,000 mobile applications installed on over 1.3 billion devices worldwide, clarified to us that it also uses comScore to determine its figures on mobile browser usage and mobile applications. Meanwhile, it uses NetMarketShare for the distribution of the browser usage. In other words, be aware that company is combining data from different sources with different methodologies here, so take that as you may.

In the new report, Flurry also examined which app categories remained most popular year-over-year, and found that gaming still dominates mobile usage with 32% of time spent on iOS and Android devices (same as last year), while Facebook remained a strong second with 17% of time spent on mobile.

However, it’s interesting to note that Facebook exhibited a slight decline year-over-year, going from 18% of time spent in 2013 to the 17% now reported, (which includes Instagram), says Flurry. Though it’s still a lead by a wide margin in terms of time spent, even that slight decline can help explain why Facebook would spend big to expand its user base and market share elsewhere on mobile, the way it did via the WhatsApp acquisition.

Facebook, combined with Twitter (1.5%) and Social Messaging apps (9.5%) grew to 28% of time spent on mobile, up from 24% last year, indicating the broader shift from socializing on Facebook to sharing within smaller, more private messaging applications.

Meanwhile, new social category YouTube accounted for 4% of time spent. Entertainment (including YouTube) and Utility apps saw their shares remain the same at 8% each, year-over-year, while productivity apps doubled their share from 2% to 4%.

Flurry also notes that, combined, Google and Facebook likely command less than 25% of the total time the average U.S. consumer spends on mobile, while the top ten franchises according to comScore, account for less than 40% of the time spent.

Says Khalaf, “despite massive efforts by Google and Facebook, the market hasn’t consolidated and over the past couple of years, we have seen new franchises emerge in almost every sector of mobile.” These include apps like Pinterest, Snapchat, WhatsApp (acquired by Facebook), Waze (acquired by Google), Spotify and more, which on their own account for a percentage or two of the time spent on mobile.

In terms of apps that lost share from 2013 to 2014, the most notable example is Safari, which dropped from 12% to 5%. Non-Google, non-Apple browser dropped from 4% to 2%. Also on the decline was the “Other” category of apps, which went from 6% to 3% – but as a grouping of all the leftovers that didn’t fit into one of the main categories cited here, that doesn’t mean as much.

Also worth noting, time spent in native apps, 2 hours and 19 minutes this year is only up 12 minutes per day (or 9.5%) from last year – an increase that’s not as notable as the previous five years, the report found, which seems to point to a sort of leveling off in terms of how much time users have to spend on devices, and in apps.

Finally, Flurry reviewed mobile advertising, citing data from eMarketer that said Facebook earned 17.5% of the overall mobile ad revenues, which is in line with their share of time spent on mobile, while Google (including YouTube) earned 49.3%, or much more than their time spent. Non-Google, non-Facebook apps accounted for 65.3% of time spent but only saw 32% of ad revenues.

“This represents a massive opportunity for applications, including gaming apps to monetize through advertising,” says Khalaf.

Image: Shutterstock/PureSolution

Does Sprint plan on competing in 2014?

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According to Fitch Ratings, Sprint’s financial profile will continue being weak through at least 2014, as their customers continue waiting for network investments. Sprint continues struggling with losses that totaled $1.62 billion in the fourth quarter amid declining revenue. More than 80 percent of Sprint’s annual revenue comes from its wireless business. Fitch Ratings gave one bright area for Sprint going forward. In 2014, Sprint plans significant cost-reduction efforts that could drive $2 billion in savings.

Sprint now seems to be implementing these cost-reduction strategies by cutting a significant chunk of their staff dedicated to repairing and refurbishing phones. A total of 55 slower-performing stores will be shut down across the country within the next few months.

In order to achieve “greater efficiencies,” Sprint cut about 200 workers at the Sprint call center in Overland Park. Additionally, call centers in Sacramento, Calif., Elmsford, N.Y. and Orlando, Florida will be closing, which eliminates about two-thirds of the call-center work force. By last count, Sprint is cutting roughly a total of 1,550 customer service jobs. Sprint seems to be under the impression that by slashing jobs around the country will somehow make their company run more smoothly and with increased efficiency.

“Those reductions come as the result of greater efficiencies that we’ve achieved through simpler pricing plans and improved customer service,” said Sprint spokeswoman Melinda Tiemeyer.

Improved customer service? Last time I checked, I found Sprint at the bottom of the Consumer Report rankings.

“Also, our technology is improving,” Tiemeyer said.

As evidence of the improving technology, a recent Denver Post report shows how tired current Sprint customers are with their monthly $10 LTE data fee for non-existent LTE service that was promised to them by Sprint over a year ago. Many subscribers have taken to Sprint’s own online forums to voice displeasure about the lack of LTE in Denver.

“I have been hearing for well over a year now that ‘it’s coming’ but I’m tired of excuses and having a smartphone with less capability than a flip phone,” user Steph547291 wrote in January on the company’s community message board. “I am absolutely livid about the runaround and increasing plan costs with such a poor network.”

The poor service quality has been reflected in recent reports by independent network evaluator RootMetrics, which ranked Sprint last in Denver and Colorado in two separate reports released over the past few months. To make matters worse, Sprint tacks on a premium data fee of $10 a month for all smartphone owners, a charge it says is needed to “deliver a superior wireless experience.”

Not to worry though as Sprint says it will consider waiving the $10 LTE data fee for subscribers without any actual LTE on a case-by-case basis, though phone owners must call customer service to initiate the review.

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Can Sprint become the data king in 2014?

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Last summer, Sprint acquired TDD spectrum in the 2.5 GHz band from Clearwire. According to a recent report from Strategy Analytics, this will be a “powerful resource” for Sprint that will allow it to catch up to its competitors. The report notes that Sprint’s 2.5 GHz spectrum is key to enabling the operator to become the “king of data speed.”

Sprint absolutely has the tools in place to build one of the most powerful, if not the most powerful, LTE network in the country. Unfortunately, we have been waiting since 2008 to get this so-called powerful 4G network from Sprint and nothing has materialized. At the moment, Sprint has a long way to go if they want to be anywhere near the top with the slowest speeds in the country, the least amount of coverage in major cities and the smallest overall capacity. Last week, Sprint’s own boss called their 4G network “horrible.”

Additionally, the report may backfire on Sprint due to recent actions by the FCC who are reviewing the spectrum screen it uses when assessing industry mergers and acquisitions and whether spectrum caps are needed in the upcoming 600 MHz auctions in order to equalize spectrum holdings among U.S. mobile operators.

In February, Sprint asked the FCC to devise a “weighted wireless broadband spectrum screen” that would come into play when the government auctions off spectrum in reference to lower band spectrum owned by Verizon and AT&T. Basically, Sprint wants the FCC to give competitive advantages to spectrum under 1GHz.

Both AT&T and Verizon responded with statements that accuse Sprint of excluding its 2.5GHz TDD spectrum from this category so that it can bid for more spectrum at the upcoming 600MHz auction, while making it difficult for the top two carriers to effect a winning bid.

AT&T and Verizon whining about Sprint and their spectrum acquisitions is hilarious when you consider that AT&T told the world that they would collapse unless they could buy T-Mobile while Verizon uses spectrum fears whenever they need a political favor.

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