iPhone Books Outweigh Games

“People don’t read anymore,” Apple CEO Steve Jobs said when he was predicting the failure of the Kindle back in 2008. According to a new statistic, books have passed games as the largest category of apps for the iPhone in the iTunes store.

Books now stand at a grand total of 26,569 compared with 25,079 games, according to Mobclix which listed the most popular apps and downloads on App store. In absolute terms, the gap is not huge, but it shows that the publishers are pushing their titles out to iTunes at an accelerated rate which coincides with the much-anticipated iPad that is due to hit the shelves in a few weeks. Already in October,according to a report by Flurry, one in five new apps was a book for the iPhone. Granted, it is much easier to get books out to iTunes these days since the publishing process is entirely digital up to the point where ink meets paper instead, whereas creating a new game from scratch is a different thing.

While it is not clear on the basis of this statistic that the actual demand for books on the handheld devices–the books on App store can be so far read only on the iPhone or iPod Touch– is on the rise, it is certain that the suppliers are betting their chips on it. And Jobs himself has changed his mind about people reading as he announced the iBookstore with the iPad as a place to buy books online.

Suppliers are confident that people will want to pay for books. Of the over 26,000 books on the Mobclix list, only 2,301 titles are distributed free of charge. That is less than 9% of the total number.

But just how much will people pay? Early reports on the iBookstore put prices on books for the iPad between $12,99 and $14,99 although some say that price was a ceiling rate and the price could be as low as Amazon’s $9,99. The books for the iPhone and iPod Touch are a different story: Many books sell for 99 cents and you can get the Complete Works of William Shakespeare (all 29 megabytes of it) for free.

At any rate, it seems safe to say that publishers think people are getting more and more comfortable reading books on a digital device, which must mean there is considerable business to be done. The publishers still have to take a long hard look at their business models so as not to have the rug pulled out from under their feet, as we could be headed toward what VentureBeat called earlier the “book industry’s Napster moment”.

U.S. Search Statistics ... Local Search is Gaining!

The U.S. search marketplace appears to have solidified in recent months with Google garnering almost two-thirds market share. Yahoo and Microsoft trailed behind, according to results released by comScore.

Google captured 65.4% of the search market in January -- a miniscule drop from its 65.7% share in the previous month.

Yahoo recorded 17%, down from 17.3% in December. Microsoft managed a gain, recording 11.3% for its Bing search engine. In December, Microsoft's search share totaled 10.7% of the search market. Rounding out the results were Ask Network, which recorded 3.8% and AOL LLC Network's 2.5%. Ask and AOL's results were virtually unchanged from December.

A year ago, prior to Bing's launch, ComScore put Microsoft's share of the U.S. search market at 8.5%.

"Americans conducted 15.2 billion searches in January, up 3% from December," comScore said in a release Thursday. "Google sites accounted for 9.9 billion searches, followed by Yahoo sites (2.6 billion), Microsoft sites (1.7 billion), Ask Network (574 million) and AOL LLC (375)."

Craigslist and Facebook also made appearances in the comScore search results with the former recording 636 million searches and the latter logging 395 million searchers. comScore noted that Facebook's searches represented a 13% gain. Other notable percentage changes were recorded by Fox Interactive Media, which dropped 5% from 424 million searches to 403 million searches from the December to January months.

According to comScore, another big loser was the Amazon sites category, which fell 21% to 238 million searchers in January from 302 million searches in the earlier month.

Source: Information Week

Verizon - Skype Smartphone Deal

Verizon Wireless and Skype announced today that owners of nine of their smartphones will be able to make international calls at Skype rates and call Skype users on PCs with Skype Mobile, a new application available this March.

"This is an app that has been built collaboratively between Verizon and Skype from the ground up," said Verizon Wireless chief marketing officer John Stratton at the Mobile World Congress show here.

Skype users will be able to make unlimited Skype-to-Skype calls using their Verizon Wireless service plan and make international calls at Skype's SkypeOut rates, which are much lower than Verizon's. The app will run in the background, letting Verizon subscribers receive Skype calls on their phones as well. Users will have to have both voice and data plans to use the app, but Skype calls won't use their voice minutes.

"With the always-on state, you'll be able to make and receive calls in a very natural flow," Stratton said.

This isn't true voice-over-IP the way most people understand it. The Skype app will connect to Skype's server using a standard Verizon Wireless voice call, and head from there via VOIP to the international or PC phone on the other end. This ensures call quality, Stratton said.

"These [calls] are right on our primary voice network. The call quality is terrific," Stratton said.

Skype users will also be able to send and receive Skype instant messages and see their friends' status on the network. But Skype CEO Josh Silverman said he didn't know if you'd be able to IM and make a voice call at the same time.

For now, the app is exclusive to Verizon Wireless, though Silverman kept describing it as a "unique experience," as if allowing for the possibility of other experiences on other carriers.

Stratton said he sees this app as appealing especially to folks who make a lot of international calls such as "recent expats and people with families overseas." Skype plans to provide flat-rate calling plans for a range of countries in the future, Silverman said.

Initially, Skype will be available on the BlackBerry Storm 9530, Storm2 9550, Curve 8330, Curve 8530, BlackBerry 8830 and Tour 9630 phones, as well as the Motorola Droid, Motorola Devour and HTC Droid Eris Android-powered smartphones.

Future plans may include integrating Skype into FIOS TV or integrating Skype into Verizon's 4G LTE services, Stratton said.

"There will be an array of service and devices that will come with [the LTE] launch," Stratton said. "There's exciting stuff that we'll be announcing with our partners at Skype at the time."

Skype is working towards a "full Skype experience," which may include video and conference calling, Silverman said. Skype will be able to show more features closer to launch, he said.

Social Networking Demographic Trends

Social networking now accounts for 11 percent of all time spent online in the US. Both social networking leader Facebook and "upstart network" Twitter both posted triple-digit growth.

Facebook surged to the number 1 position among social networks for the first time in May 2009, and continued its strong growth trajectory throughout the year - finishing with 112 million visitors in December 2009, up 105 percent during the year.

Twitter finished the year with nearly 20 million visitors to its website, up from just 2 million visitors from the previous year.

According to comScore's "The 2009 U.S. Digital Year in Review" report nearly four out of five US Internet users visited a social networking site in December 2009.

Twitter's audience growth occurred during the first few months of 2009 - at one point jumping from 4 million visitors to 17 million visitors between February and April.

Former social leader MySpace lost ground to Facebook. comScore report that its new strategic focus on entertainment content is working with MySpace Music growing 92 percent in the past year.

MySpace saw its user composition shift toward younger audience segments in 2009, with people age 24 and younger now comprising 44.4 percent of the site's audience, up more than 7 percentage points from the previous year.

Facebook grew substantially across nearly every performance metric in 2009. Unique visitors, page views, and total time spent all increased by a factor of two or more.

Frequency metrics such as average minutes per usage day (up 6 percent) and average usage days per visitors (up 37 percent) also saw gains.

Facebook's audience was evenly split between those younger and older than 35 years of age. The most noticeable demographic shift on Facebook during the year occurred with 25-34 year olds, who now account for 23 percent of the audience, up from 18.8 percent last year.

As more people use Facebook more frequently, the site has grown to account for three times as much total time spent online as it did last year.

The only metric by which Facebook decreased was the average minutes per visit (down 11 percent), which can likely be attributed to the increasing frequency with which people are visiting the site - says comScore.

As Twitter's audience grew in 2009, the site experienced interesting shifts in its demographic composition.

The initial success of Twitter was largely driven by users in the 25-54 year old age segment, which made up 65 percent of all visitors to the site in December 2008, with 18-24 year olds accounting for just 9 percent of visitors.

This older age skew varied dramatically from the traditional social media early adopter model, in which younger users tend to drive the lion's share of usage.

Despite Twitter's initially older skew, as it gained widespread popularity with the help of celebrity Tweeters and mainstream media coverage, younger users flooded to the site in large numbers, with those under age 18 (up 6.2 percentage points) and 18-24 year olds (up 7.9 percentage points) representing the fastest growing demographic segments.

iPad / Tablet Market

The much anticipated launch by Apple last week of its iPad computing device highlights the real start of a new market segment for media tablets that according ABI Research, will see 4 million units shipped in 2010.

By 2015, shipments are expected to reach about 57 million annually. ABI defines media tablets as having a touch-screen interface, 5-11 inches in size, with Wi-Fi Internet connectivity and video and gaming capabilities.

The current thinking is the 'tablet' is targeted at entertainment and media consumption and will not cannibalize smartphones, netbooks or laptops. I agree that it won't impact smart phones largely because a 10" x 9" device is portable device but definitely not a mobile device. However, I do think it can potentially cannibalize the netbook and laptop market and maybe even Apple's iTouch. Why?

• Laptop - They are still expensive (that's why there is a netbook market) and I think many people way overbuy what they actually want a laptop for ... Internet access.

• Netbook - I was duped on this myself. Like many, I focused on battery life and forgot about performance. They are WAY underpowered, even for internet access. Our Samsung is so slow, we don't use it. At the low end price point, Apple's iPad sits right in between a high end netbook and a low end laptop. Apple is a pricing master, this price point wasn't by accident.

• iTouch - Love the iTouch and many people stick with a traditional wireless plan and use the iTouch as their multimedia device. However, the real secret is that the iTouch took off not as an 'iPod' but as a gaming platform. That's why they still haven't added a camera and some other features I think it needs. A high end iTouch is $399 today and the low end iPad will $499. Same basic device, but the size of the iPad opens up a whole new world world.

Net, Net I think people will initially buy the iPad because it's cool (and it definitely is) but there is a huge overlap with how the mass market uses the iTouch (Gaming, Music), Netbooks (Internet Access), and laptops (Internet access and portable computing). However, as the 'early adaptor' dust settles, I think consumers will be making a conscious decision to by an iPad or an iTouch / Netbook / Laptop.