Legendary venture capitalist and tech industry sage Mary Meeker has finally released the 2018 version of her famous annual Internet Trends report. Meeker was involved with the IPOs of Google, Netscape and Priceline, and her annual predictions are considered a “must read” by leading figures across the media, tech and publishing industries.
Unveiled this week by analysts KPCB (KIeiner Perkins Caufield & Byers), the study covers key media trends, privacy, on-demand services, the rise of machine learning, global internet penetration, and how voice user interfaces are becoming increasingly important.
Weighing in at almost 300 slides long, WNIP has dissected the report and selected seventeen key takeaways publishers need to know:
“The dynamics of global innovation & competition are driving product improvements, which, in turn, are driving usage & monetization,” says Meeker. “Internet Users continue to increase time spent on Internet services based on perceived value.”
More than half the world’s population are Internet users, or roughly 3.6 billion. It comes with a caveat, though… growth will be harder to find after hitting 50% market penetration.
The number of active social media users is keeping pace with global internet penetration, helped by cheaper connectivity and data. The uneasy dalliance between publishers and social sharing platforms is set to continue since social is where the eyeballs are.
Global smartphone shipments aren’t growing anymore. People are keeping their devices longer, and Western markets appear to be saturated. iOS and Android have consolidated their hold on the market, with other platforms having no significant presence anymore.
People are increasing the amount of time they spend online. In 2008, Americans spent 2.7 hours per day consuming digital media (across all types of devices). In 2017, that number was way up, to 5.9 hours. Focusing solely on mobile devices, the growth is even more fantastic, going from 20 minutes to 3.3 hours a day over the same time frame.
In step with the rise of digital media consumption, WiFi network access is shooting up, easing the distribution of bandwidth-consuming content like video, audio and high-resolution imagery.
On a related note, video usage on mobile is on a consistent growth path. This is based on a study across 63 countries, with figures taken from the most reliable third-party sources in each market (including Nielsen and comScore); the trend is consistent across the globe.
Higher user engagement indicates that Facebook’s value to publishers’ will likely continue, even with the social network currently prioritizing “meaningful” conversations between friends and family over stories from publishers, brands, and businesses.
Advertisers say they are valuing “customer lifetime value” (LTV) more as a metric of ad spend, given the considerable rise of customer acquisition costs. For premium publishers, this is good news, not least the quality of their long-term, loyal audiences.
Subscription services are seeing massive adoption. The New York Times’ digital subscription growth (43% year-over-year in 2017) is on par with the growth rate of Spotify (48%). Netflix also saw a significantly high growth of 25% even while growing off a much larger existing base. A free tier helps to accelerate conversion rates – publishers take note.
Total news-consuming sessions on mobile in the U.S. increased by 20% YoY in 2017. Music/Media/Entertainment grew at a higher rate of 43%, while Business/Finance sessions saw a healthy 33% growth.
Driven by mobile ads, internet advertising spend is growing at a healthy clip in the U.S., at 22% YoY in 2017. Ad dollars in digital (desktop + mobile) roughly doubled just from 2014 to 2017 ($43 billion to $88 billion).
Attention (i.e. time spent in media) is shifting to mobile faster than the advertising spend, with 29% of time spent on mobile vs. 26% of ad dollars, creating a massive $7 billion gap.
Advertisers and users are demanding higher accountability from content platforms, and it’s impacting usage/ad spend.
Digital payments and friction-less mobile wallets are on the uptick, with a large adoption globally. Combined with the high growth of digital subscription services, it’s an encouraging trend for publishers.
While the coming impact of Artificial Intelligence is still largely unknown—with speculation ranging from astounding to apocalyptic—adoption in enterprises is already underway.
With the CEO of Google going on record heralding AI as more profound than electricity or fire, the writing is on the wall. Only that it’s still mostly indecipherable … while being inevitable.
Finally, there’s a large demand in online educational content—with rapid changes in work environment and evolving job requirements—and platforms like Coursera and Udacity are at the forefront in catering to this need.
Educational content usage on YouTube is growing fast, with 1 Billion learning video views daily. Popular courses include Cyber Security, Machine Learning, Data-Driven Decision Making and Virtual Collaboration.
Internet usage, social media users, digital media consumption, subscription services, mobile app sessions are all on the rise, although growth in smartphones has peaked; Internet ad spend is up, and there’s a $7 Billion ad gap on mobile waiting to be exploited; AI will change everything; and all over the world people are frantically trying to learn and adapt to a changing world.
In conclusion, it’s a dynamic time for publishers and society at large. it’s a time of profound change, and a time of benefiting from these changes. Indeed, it’s incumbent on publishers to take advantage of the disruption ahead. As Centaur Media’s CEO Andria Vidler was heard to say at the recent PPA Festival in London, either “disrupt or be disrupted”.
Click to view the complete Mary Meeker’s Internet Trends 2018 Report