The web is nice, but news sites need native apps too

July 9, 2014
Obsession
Mobile Web
July 9, 2014

By the end of 2014, many news media will collect around 50% of their page views via mobile devices. Here are trends to remember before devising a mobile strategy. (First of a two-part series.)

In the news business, mobile investments are on the rise

That’s the pragmatic response to a major trend: Users shift from web to mobile. Already, all major media outlets are bracing for a momentous threshold: 50% of their viewership coming from mobile devices (smartphones and tablets). Unfortunately, the revenue stream is not likely to follow anytime soon–making users pay for mobile content has proven much more difficult than hoped for. As for advertising, the code has yet to be cracked for (a) finding formats that won’t trigger massive user rejection, and (b) monetizing in ways comparable to the web (i.e. within the context of a controlled deflation). Let’s dive into a few facts:

Apps vs. WebApps or mobile sites

A couple of years ago, I was among those who defended web apps (i.e. encapsulated HTML5 coding, not tied to a specific OS platform) vs. native apps (for iOS, Android, Windows Phone). The idea was to give publishers more freedom and to avoid the 30% app store levy. Also, every publisher had in mind the success enjoyed by the FT.com when it managed to put all its eggs in its web app and so retain complete control over the relationship with its customers.

All of the above remains true but, from the users’ perspective, facts speak loudly: According to Flurry Analytics, apps now account for 86% of the time spent by mobile users vs. 14% for mobile sites (including web apps.) A year ago, the balance was 80% for apps and 20% for mobile web.

Trend #1: Native apps lead the game at the expense of web apps and mobile sites 

One remark, though: the result must take in account the weight of games and Facebook apps that account for 50% of the time spent on mobile. News-related usage leans more to mobile as there is not (yet) demand for complex rendering as in a gaming app. But as far news applications are concerned, we haven’t seen major breakthroughs in mobile web or web apps over the last months and it seems development is stalling.

News vs. the rest of the app world

On a daily total of 2 hours 50 minutes spent by mobile users (source: eMarketer), 2% to 5% of that time is spent on news. Once you turn to growth, the small percentage number starts to look better: The news segment is growing faster (+64% Y/Y) than messaging and social (+28%) or gaming and entertainment (+9% each); the fastest usage segment being the productivity apps (+119%) and that’s due to the transfer of professional uses from the desktop to the mobile.

Trend #2: On mobile, news is growing faster than game or social 

…And it will grow stronger as publishers will deploy their best efforts to adjust contents and features to small screens and on-the-go usage and as mobile competitors multiply.

iOS vs. Android: the monetization issue

Should publishers go for volume or focus on the ARPU (revenue per user)? If that’s the reasoning, the picture is pretty clear: an iOS customer brings on average five times more money than an Android user. And the gap is not about to close. However, Android OS has about one billion users vs 470m users for iOS, but most of Android users are in low income countries, where phones can cost as little as $80, and prices are falling fast. By contrast, an iPhone will cost around $600 (without a carrier contract) and the not-so-successful “cheap” iPhone 5C shows that iPhone is likely to remain a premium product.

Trend #3: There is more money to make on iOS than Android and that’s not likely to change

Beside, we must take in account two sub-trends: iOS will gain in sophistication with the arrival of iOS 8 (see Jean-Louis’ recent column about iOS 8 being the real version 2.0 of iOS) and a new breed of applications based on the new Swift  programming language. Put differently: Advanced functionalities in Swift/iOS 8-based apps will raise the level of user expectations; publishers will be forced to respond accordingly: as apps reside side-by-side on the same mobile screen, news apps will be required to display the same level of sophistication than, say, a gaming app–that’s also why I’m less bullish on web apps. Behind the iOS/Android gap lies another question: Should publishers have the same app (content, features, revenue model across) all platforms–or must they tailor their product to platform “moneygraphics”? That’s an open question.

I’ll stop here for today. Next week, I’ll explore trends and options for business models, marketing tactics, why it could be interesting to link a news app to the smartphone accelerometer and why news media should tap into game developers for certain types of qualifications.

You can read more of Monday Note’s coverage of technology and media here.

Top News

Powered by WordPress.com VIP
Follow

Get every new post delivered to your Inbox.

Join 26,263 other followers