This article originally appeared April 14th, 2015 on VentureBeat
15 years ago, collectively, the world’s data usage staggered at 1 exabyte per year. In 2014, due to smartphone devices, we’ve jumped to 30 exabytes per year. This is important because by 2019, in just four years from today, we will have increased our data usage to 288 exabytes (almost 10x) with the key smartphone drivers being video, photo, and messaging.
The verticals driving data collection match the world’s high valuations, notably Instagram at $35 billion, Snapchat at $10 to $15 billion and Whatsapp at $19 billion, but have virtually no revenue (yet). Therefore, in 2015, it is easy to see why the value of a mobile business will depend on how well the company understands — and leverages — the collection of data.
My authored analysis in the Q1 2015 mobile data published by my company, Personagraph, reveals the following three trends that will be must-haves to capture this movement in 2015. You can download the full Mobile Data report here.
3 Key Drivers to Make Money off Data:
Your App is Nothing if it Doesn’t Have Video
Mobile data will grow by 59 percent in 2015 with the key driver of this growth being mobile video. As of March 2015, mobile video is predicted to drive over 60 percent of data traffic in 2018. This could be a conservative estimate considering mobile video already claimed 55 percent of all traffic in 2014. These indicators point to very strong consumer demand for fast, seamless video moments, especially those that encourage people to share the videos they’ve watched and uploaded.
With such large market share, we will see apps and services scramble to add video, and even video-calling features, to experience an upswing in traffic and user engagement.
We saw early evidence of this trend during the first quarter of 2015 with the launch of Meerkat at South by Southwest last month and Twitter quickly responding to shut down the use of its social API. However, Snapchat Discover may be the most successful video metric from last quarter, experiencing hockeystick growth from roughly 200 megabytes to 600 megabytes (an increase of 3x) just days after introducing its video feature on January 27, 2015.
Divide and Conquer
The proliferation of social media apps and user adoption adds greatly to the troves of mobile user data available. There are over 2 billion live social media accounts globally with over 1.6 billion mobile social media accounts, equaling a 23 percent year on year growth from January 2014 to January 2015.
Noteworthy, Instagram’s user base grew by 50 percent in nine months during 2014, totaling 300 million users, surpassing Twitter. The social media app sees more than 70 million photos and videos shared each day.
We’ve seen other apps gain steadily in user data information during 2013 and 2014, such as Fitbit, which has gone from tracking 47 billion steps in 2011 to 2.4 trillion in 2013.
Breaking down mobile services and platforms into single-purpose apps like these for the ease of data mining is key to extracting the correct inferences and user profiles, which can in turn create richer audience segments.
Last year, we saw Facebook split messaging into the single-purpose app Facebook Messenger. Other single-purpose apps include Foursquare’s Swarm, which puts to use Foursquare’s historical location data. The Swarm app checks in for you with a new feature called Neighborhood Sharing.
Similar to the relationship between Facebook and Facebook Messenger, the data from the single-purpose app is much easier to mine and helps inform the Foursquare platform by tying in additional user data.
We are likely to see this continued trend of splitting platforms into single-purpose apps. Likewise, smaller, yet well-designed single-purpose apps along the same vein as these are predicted to have strong uptake.
The Less Censored, the Better
Messaging app user adoption has grown faster than social networks in the last two years, and we expect messaging apps will surpass social networks in the first half of 2015.
In addition to their popularity among users, messaging apps also offer a much easier way to collect user data, as conversations in private messages are essentially uncensored, and what is shared via private chat compared to status updates and public profiles can provide valuable insights for data mining (and advertising).
Ephemeral is not truly ephemeral, as we’ve seen with the recent government request for Snapchat’s data. Yet, the idea of ephemeral encourages uncensored sharing. As we move into a more mature mobile market, in terms of data sets, both messaging and ephemeral will trump the social graph due to the uncensored nature of the data.
In conclusion, as we move into the mobile era, the revenue we generate will closely be tied to the level of data we collect. Technology’s biggest players are moving quickly to capture the trends of video, photos, and private messaging, all of which create unparalleled layers of data.