Global app revenue jumps to $50B in the first half of 2020, in part due to COVID-19 impacts

Consumer spending on mobile apps and app installs grew significantly during the first half of 2020, in part due to the COVID-19 pandemic, according to new data from Sensor Tower. In the first half of the year, consumers spent $50.1 billion worldwide across the App Store and Google Play — a figure that’s up 23.4% from the first half of 2019. Previously, revenue had grown 20% between the first half of 2018 and 2019, for comparison. In addition, first-time app installs were up 26.1% year-over-year in the first half of 2020 to reach 71.5 billion downloads.

Apple’s App Store accounted for 18.3 billion of those downloads, up 22.8% year-over-year, while Google Play delivered 53.2 billion new app installs, up 27.3%.

Image Credits: Sensor Tower

Though Google Play saw far more app installs, Apple’s App Store continued to outpace its rival on consumer spending.

During the first half of the year, the App Store generated $32.8 billion from in-app purchases, subscriptions, and premium apps and games, Sensor Tower estimates. This figure is up 24.7% year-over-year from the $26.3 billion spent during the first half of 2019. It’s also nearly twice the estimated gross revenue on Google Play, which was $17.3 billion, an increase of 21% year-over-year.

Image Credits: Sensor Tower

The pandemic’s impacts are only somewhat reflected in the top-earning (non-game) apps of the first half of 2020. The biggest earner, for example, was Match’s online dating app Tinder — an app that, one would think, would have dropped out of the top 5 due to social distancing requirements.

During the first half of the year, Tinder generated an estimated $433 million in spending across both app stores, combined. However, this number does represent a decrease of about 19% from the first half of 2019, or $532 million. It’s unclear how much that decline is related to consumers’ changing behavior and spending habits during the pandemic. Though shelter-in-place orders and quarantines kept people indoors and social distancing, social networking apps — and particularly those focused on online communication — have boomed amid lockdowns.

Image Credits: Sensor Tower

Tinder embraced the growing interest in online networking by making its “Passport” feature free. This setting allows users to match with other singles around the world, turning Tinder into more of a social app than one focused on real-world dating. But this change could have also led to a decrease in Tinder’s total revenues for the first half of the year.

The No. 2 top grossing app during the first half of 2020 was YouTube, bringing in an estimated $431 million globally. This was followed by ByteDance’s TikTok with $421 million. The social video app, which includes Douyin in China, had also broken download records during the first half of the year, passing 2 billion total global downloads, Sensor Tower earlier reported.

Tencent Video and Netflix were the No. 4 and No. 5 top grossing apps, respectively.

Meanwhile, consumers stuck at home during the pandemic have been downloading apps and games in greater numbers. During the first half of the year, consumers installed 71.5 billion apps for the first time, up 26.1% from the first half of 2019.

Image Credits: Sensor Tower

TikTok was the most-downloaded app in the first half of the year with 626 million downloads. But its position may look quite different in the second half of year, given the recent changes in India where the government has now banned 59 Chinese apps, including TikTok.

The No. 2 and No. 3 apps were WhatsApp and Zoom, respectively — the latter an indication of the rapid shift to work-from-home and consumers’ embrace of online video conferencing, in general. In addition to WhatsApp, Facebook snagged the No. 4, No. 5, and No. 6 positions in the top 10, with Facebook, Instagram and Messenger, in that order.

Snapchat’s social app was No. 7 and No. 8 was video app Likee, which is similar to TikTok but offers a variety of face effects and filters. Netflix and YouTube rounded out the top 10.

Mobile gaming also saw a boost during the pandemic, with game spending up 21.2% year-over-year to reach an estimated $36.6 billion during the first half of the year, Sensor Tower found. Spending on the App Store grew 22.7% year-over-year to reach $22.2 billion, while Google Play game spending grew 19% to reach $14.4 billion.

Image Credits: Sensor Tower

Tencent’s PUBG Mobile beat out Honor of Kings as the top-grossing game for the first half of the year. Tencent’s game, which includes its localized versions (Game for Peace and Peacekeeper Elite) generated $1.3 billion across both app stores, not including China’s third-party Android app stores. Honor of Kings, meanwhile, pulled in roughly $1 billion.

The remaining top 10 included, in order, Monster Strike ($632M), Roblox, Coin Master, Candy Crush Saga, AFK Arena, Gardenscapes, Fate/Grand Order, and Pokémon Go. The latter recently adapted to indoor gaming amid government lockdowns.

Roblox, in particular, has been surging due to the pandemic as kids stuck indoors have gone online to play and socialize with friends in its virtual environment. In June, Sensor Tower reported Roblox had surpassed a milestone of $1.5 billion in lifetime player spending, for instance. Coin Master, meanwhile, is approaching the $1 billion lifetime player milestone, the firm found.

In terms of top game installs, PUBG Mobile came out on top here as well, followed by another battle royale title, Garena Free Fire. Ruby Game Studio’s Hunter Assassin, Eyewind Limited’s Brain Out, and Playrix’s Gardenscapes — which many found to be a relaxing distraction during a stressful time — rounded out the top five.

Image Credits: Sensor Tower

Across all of the mobile gaming market, downloads grew 42.5% year-over-year to reach 28.5 billion first-time installs in the first half of 2020. Of those, Google Play downloads grew 46.2% year-over-year to 22.8 billion while App Store downloads grew 29.5% to 5.7 billion.

Image Credits: Sensor Tower

 

COVID-19 impacts more apparent in Q2 

Indications of COVID-19’s impact on the app market can be found among the figures for the first half of the year — like the growth seen by Zoom or social gaming platforms like Roblox, for example. But a closer look at the second quarter of 2020 alone makes the COVID-19 impacts more apparent.

Sensor Tower’s initial projections show consumer spending on apps and games jumped 11% on a quarterly basis from Q1 to Q2, and grew 28.8% year-over-year to reach $26.4 billion worldwide. This is a sizable increase from the 1.4% growth between Q1 2019 and Q2 2019. Downloads were up 12% on a quarterly basis and up 31.7% year-over-year to reach 37.8 billion worldwide. Again, a large increase from the 2.5% growth between Q1 2019 and Q2 2020.

Kahoot raises $28M for its user-generated educational gaming platform, now valued at $1.4B

As schools stay closed and summer camp seems more like a germscape than an escape, students are staying at home for the foreseeable future and have shifted learning to their living rooms. Now, Norwegian educational gaming company Kahoot — the popular platform with 1.3 billion active users and over 100 million games (most created by users themselves) — has raised a new round of funding of $28 million to keep up with demand.

The Oslo-based startup, which started to list some of its shares on Oslo’s Merkur Market in October 2019, raised the $28 million in a private placement, and said it also raised a further $62 million in secondary shares. The new equity investment included participation from Northzone, an existing backer of the startup, and CEO Eilert Hanoa. While it’s not a traditional privately held startup in the traditional sense, at the market close today, the company’s valuation was $1.39 billion (or 13.389 billion Norwegian krone).

Existing investors in the company include Disney and Microsoft, and the company has raised $110 million to date.

Kahoot launched in 2013 and got its start and picked up most of its traction in the world of education through its use in schools, where teachers have leaned on it as a way to provide more engaging content to students to complement more traditional (and often drier) curriculum-based lessons. Alongside that, the company has developed a lucrative line of online training for enterprise users as well.

The global health pandemic has changed all of that for Kahoot, as it has for many other companies that built models based on classroom use. In the last few months, the company has boosted its content for home learning, finding an audience of users who are parents and employers looking for ways to keep students and employees more engaged.

The company says that in the last 12 months it had active users in 200 countries, with more than 50% of K-12 students using Kahoot in a school year in that footprint. On top of that, it is also used in some 87% of “top 500” universities around the world, and that 97% of Fortune 500 companies are also using it, although it doesn’t discuss what kind of penetration it has in that segment.

It seems that the coronavirus outbreak has not impacted business as much as it has in some sectors. According to the midyear report it released earlier this week, Q2 revenue is expected to be $9 million, 290% growth compared to last year and 40% growth compared to the previous quarter, and for the full year 2020, it expects revenue between $32 million and $38 million, with a full IPO expected for 2021.

As it has been doing even prior to the coronavirus outbreak, Kahoot has also continued to invest in inorganic growth to fuel its expansion. In May, it acquired math app maker DragonBox for $18 million in cash and shares. The company also runs an accelerator, Kahoot Ignite, to spur more development on its platform.

However, Hanoa said that Kahoot is shifting its focus to now also work with more mature edtech businesses.

“When we started out, we were primarily receiving requests on early stage products,” he said. “Now we have the opportunity to consider mature services for either integration or corporation. It’s a different focus.”

Update: A previous version of this story said that DragonBox was acquired in March. It was acquired in May. The story has been updated to reflect this change. 

FTC fines kids’ app developer HyperBeard $150K for use of third-party ad trackers

The U.S. Federal Trade Commission (FTC) today announced a settlement of $150,000 with HyperBeard, the developer of a collection of children’s mobile games over violations of U.S. Children’s Online Privacy Protection Act Rule (COPPA Rule). The company’s applications had been downloaded more than 50 million times on a worldwide basis to date, according to data from app intelligence firm Sensor Tower.

A complaint filed by the Dept. of Justice on behalf of the FTC alleged that HyperBeard had violated COPPA by allowing third-party ad networks to collect personal information in the form of persistent identifiers to track users of the company’s child-directed apps. And it did so without notifying parents or obtaining verifiable parental consent, as is required. These ad networks then used the identifiers to target ads to children using HyperBeard’s games.

The company’s lineup included games like Axolochi, BunnyBuns, Chichens, Clawbert, Clawberta, KleptoCats, KleptoCats 2, KleptoDogs, MonkeyNauts and NomNoms (not to be confused with toy craze Num Noms).

The FTC determined HyperBeard’s apps were marketed toward children because they used brightly colored, animated characters like cats, dogs, bunnies, chicks, monkeys and other cartoon characters, and were described in child-friendly terms like “super cute” and “silly.” The company also marketed its apps on a kids’ entertainment website, YayOMG, published children’s books and licensed other products, including stuffed animals and block construction sets, based on its app characters.

Unbelievably, the company would post disclaimers to its marketing materials that these apps were not meant for children under 13.

Above: A disclaimer on the NomNoms game website. 

In HyperBeard’s settlement with the FTC, the company has agreed to pay a $150,000 fine and delete the personal information it illegally collected from children under the age of 13. The settlement had originally included a $4 million penalty, but the FTC suspended it over HyperBeard’s inability to pay the full amount. But that larger amount will become due if the company or its CEO, Alexander Kozachenko, are ever found to have misrepresented their finances.

HyperBeard is not the first tech company to be charged with COPPA violations. Two high-profile examples preceding it were YouTube and Musical.ly (TikTok)’s settlements of $170 million and $5.7 million, respectively, both in 2019. By comparison, HyperBeard’s fine seems minimal. However, its case is different from either video platform as the company itself was not handling the data collection — it was permitting ad networks to do so.

The complaint explained that HyperBeard let third-party advertising networks serve ads and collect personal information in the form of persistent identifiers, in order to serve behavioral ads — meaning, targeted ads based on users’ activity over time and across sites.

This requires parental consent, but companies have skirted this rule for years — or outright ignored it, like YouTube did.

The ad networks used in HyperBeard’s apps included AdColony, AdMob, AppLovin, Facebook Audience Network, Fyber, IronSource, Kiip, TapCore, TapJoy, Vungle and UnityAds. Despite being notified of the issue by watchdogs and the FTC, HyperBeard didn’t alert any of the ad networks that its apps were directed towards kids, not to make changes.

The issues around the invasiveness of third-party ad networks and trackers — and their questionable data collection practices — have come in the spotlight thanks to in-depth reporting about app privacy issues, various privacy experiments, petitions against their use and, more recently, as a counter-argument to Apple’s marketing of its iPhone as a privacy-conscious device.

Last year, these complaints finally led Apple to ban the use of third-party networks and trackers in any iOS apps aimed at kids.

HyperBeard’s install base was below 50 million at the time of the settlement, we understand. According to Sensor Tower, around 12 million of HyperBeard’s installs to date have come from its most popular title, Adorable Home, which only launched in January 2020. U.S. consumers so far have accounted for about 18% of the company’s total installs to date, followed by the Chinese App Store at 14%. So far, in 2020, Vietnam has emerged as leading the market with close to 24% of all installs since January, while the U.S. dropped to No. 7 overall, with a 7% share.

The FTC’s action against HyperBeard should serve as a warning to other app developers that simply saying an app is not meant for kids doesn’t exempt them from following COPPA guidelines, when it’s clear the app is targeting kids. In addition, app makers can and will be held liable for the data collection practices of third-party ad networks, even if the app itself isn’t storing kids’ personal data on its own servers.

“If your app or website is directed to kids, you’ve got to make sure parents are in the loop before you collect children’s personal information,” said Andrew Smith, director of the FTC’s Bureau of Consumer Protection, in a statement about the settlement. “This includes allowing someone else, such as an ad network, to collect persistent identifiers, like advertising IDs or cookies, in order to serve behavioral advertising,” he said.

Kids now spend nearly as much time watching TikTok as YouTube in U.S., U.K. and Spain

A new study on kids’ app usage and habits indicates a major threat to YouTube’s dominance, as kids now split their time between Google’s online video platform and other apps, like TikTok, Netflix, and mobile games like Roblox. Kids ages 4 to 15 now spend an average of 85 minutes per day watching YouTube videos, compared with 80 minutes per day spent on TikTok. The latter app also drove growth in kids’ social app use by 100% in 2019 and 200% in 2020, the report found.

The data in the annual report by digital safety app maker Qustodio was provided by 60,000 families with children ages 4 to 14 in the U.S., U.K., and Spain, so it’s data isn’t representative of global trends. The research encompasses children’s online habits from February 2019 to April 2020, takes into account the COVID-19 crisis, and specifically focused on four main categories of mobile applications: online video, social media, video games, and education.

YouTube, not surprisingly, remains one of the most-used apps among children, the study found.

Kids are now watching twice as many videos per day as they did just four years ago. This is despite the fact that YouTube’s flagship app is meant for ages 13 and up — an age-gate that was never truly enforced, leading to the FTC’s historic $170 million fine for the online video platform in 2019 for its noncompliance with U.S. children’s privacy regulations.

The app today is used by 69% of U.S. kids, 74% of kids in the U.K., and 88% of kids in Spain. Its app for younger children, YouTube Kids, meanwhile, is only used by 7% of kids in the U.S., 10% of kids in the U.K., and wasn’t even on the radar in Spain.

The next largest app for online video is Netflix, watched by 33% of U.S. kids, 29% of U.K. kids, and 28% of kids in Spain.

In early 2020, kids in the U.S. were spending 86 minutes on YouTube per day, down from 88 minutes in 2019. In the U.K., kids are watching 75 minutes per day, down from 77 minutes in 2019. And in Spain, kids watch 63 minutes per day, down from 66 minutes in 2019.

During the COVID-19 lockdowns, the time spent increased quite a bit, as you could imagine. In the U.S., for example, kids in mid-April spent 99 minutes per day on YouTube.

In part, the decline in total YouTube minutes could be due to the growing number of daily minutes kids spend on TikTok. The Beijing-owned short-form video app could gain further traction if more YouTube creators leave Google’s video platform as a result of the increasing regulations and the related losses in monetization. More creators would broaden TikTok’s appeal, as it expands its content lineup.

Last year, TikTok became one of the top five most-downloaded apps globally that wasn’t owned by Facebook, and it has continued to grow among all age demographics.

From May 2019 through February 2020, the average minutes per day kids spent on TikTok increased by 116% in the U.S. to reach 82 minutes, went up by 97% in the U.K. to reach 69 minutes, and increased 150% in Spain to reach 60 minutes.

In February 2020, 16.5% of U.S. kids used TikTok, just behind the 20.4% on Instagram, and ahead of the 16% on Snapchat. In the U.K. and Spain, 17.7% and 37.7% of kids used TikTok, respectively.

Time spent on TikTok increased during COVID-19 lockdowns, as well, leaving the app now only minutes away from being equal to time spent on YouTube. In the U.S., for example, kids’ average usage of TikTok hit 95 minutes per day during COVID-19 lockdowns compared with just 2 minutes more — 97 minutes — spent on YouTube

In terms of online gaming, Roblox dominates in the U.S. and U.K., where 54% and 51% of kids play, respectively. In Spain, only 17% do. Instead, kids in Spain currently prefer Brawl Stars.

Similarly, Minecraft is used by 31% of kids in the U.S., 23% in the U.K., and only 15% in Spain.

Roblox isn’t just a minor diversion. It’s also eating into kids’ screen time.

In February 2020, this one game accounted for 81 minutes per day, on average, in the U.S., 76 minutes per day in the U.K., and 64 minutes per day in Spain. On average, kids play Roblox about 20 minutes longer than any other video game app. (Take that, Fortnite!)

During COVID-19 lockdowns, the kids who played Roblox increased their time spent in the game, up 31%, 17%, and 45% respectively in the U.S., the U.K., and Spain. But lockdowns didn’t increase the percentage of kids who used gaming apps, as it turned out.

Education apps, as a whole, did not see much growth from 2019 to early 2020 until the COVID-19 lockdowns. But then, Google Classroom won in two of the three markets studied, with 65% of kids now using this app in Spain, 50% in the U.S., but only 31% in the U.K. (Show My Homework is more popular in the U.K., growing to 42% usage during COVID-19.)

All these increases in kids’ app usage may never return to pre-COVID-19 levels, the report suggested, even if usage declines a bit as government lockdowns lift. That mirrors the findings that Nielsen released today on connected TV usage, which has also not yet fallen to earlier, pre-COVID levels even as government restrictions lift.

“We now live in a world with an estimated 25 billion connected devices worldwide. Many of those in the hands of children,” Qustodio’s report noted. “Today, on average, a child in the U.S. watches nearly 100 minutes of YouTube per day, a child in the U.K. spends nearly 70 minutes on TikTok per day, a child in Spain plays Roblox over 90 minutes a day,” it said. “The world is not going to return to the way things were, because screen-time rates were already increasing. COVID-19 just accelerated the process,” the firm concluded.

Game downloads will be throttled to manage internet congestion

For the billions stuck at home during the global effort to flatten the curve, gaming is a welcome escape. But it’s also a bandwidth-heavy one, and Microsoft, Sony and others are working to make sure that millions of people downloading enormous games don’t suck up all the bandwidth. Don’t worry, though, it won’t affect your ping.

A blog post by content delivery network Akamai explained a few things it is doing to help mitigate the tidal wave of traffic that the internet’s infrastructure is experiencing. Although streaming video is of course a major contributor, games are a huge, if more intermittent, burden on the network.

Akamai is “working with leading distributors of software, particularly for the gaming industry, including Microsoft and Sony, to help manage congestion during peak usage periods. This is very important for gaming software downloads, which account for large amounts of internet traffic when an update is released,” the post reads.

Take the new “Call of Duty: Warzone” battle royale game, released last week for free and seeing major engagement. If you didn’t already own the latest CoD title, Warzone was a more than 80-gigabyte download, equivalent to dozens of movies on Netflix . And what’s more, that 80 gigs was likely downloaded at the maximum bandwidth home connections provided; streaming video is limited to a handful of megabits over the duration of the media, nowhere close to saturating your connection.

And Warzone isn’t alone — there are tons of high-profile games being released at a time when many people have nothing to do but sit at home and play games — PC game platform Steam posted a record 20 million concurrent players the other day, and one analysis saw a 400% increase in gaming traffic. So gaming is bigger than ever, while games are bigger than ever themselves.

As a result, gaming downloads will be throttled for the foreseeable future, at least in some markets. “Players may experience somewhat slower or delayed game downloads,” wrote Sony Interactive Entertainment CEO Jim Ryan in a brief blog post. I’ve asked Microsoft, Nintendo and Valve for comment on their approach as well.

It’s important to note that this should not apply to the rest of the gaming experience. Unlike downloading games, playing games is a remarkably low-bandwidth task — it’s important for packets to be traded quickly so players are in sync, but there aren’t a lot of them compared with even a low-resolution streaming video.

The best thing to do is to set your games to be downloaded overnight, as local infrastructure will be less taxed while everyone in your region is asleep. If you have downloads or updates coming during the day, don’t be surprised if they take longer than usual or are queued elsewhere.

Female-led Robin Games raises $7 million to combine lifestyle content with fantasy gaming

As a former Jam City executive, Jill Wilson led teams behind some of the top-grossing gaming franchises, like Cookie Jam and Panda Pop. Now she’s running her own startup, Robin Games, where a team of mostly women is working to create a new niche in mobile entertainment they’re calling “lifestyle gaming.” As the name implies, the idea is to create a mobile gaming experience — in this case, fantasy gaming — that’s more like the sophisticated and stylish lifestyle content that’s popular today.

Robin Games is backed by $7 million in seed funding, the company announced on Thursday, as it made its public debut. The round was led by early-stage fund LVP, which has invested in other to game companies including Supercell, Playfish, and NaturalMotion. Additional investors in the oversubscribed round include 1Up Ventures, Alpha Edison, Everblue Management, firstminute Capital, Greycroft Tracker Fund, Hearst Ventures, and Third Kind Venture Capital.

“Traditionally in gaming, when you say ‘fantasy,’ you mean dragons and other mythical creatures, disproportionately built women, armies and battles and explosions and glory,” explained Wilson, Robin Games’ sole founder and CEO. “As a lifelong gamer, I love (most) of these themes, but traditional gamers are no longer in the majority. Thanks to the smartphone, everyone now has access to a gaming console in their pockets. We are expanding the definition of ‘fantasy’ for this modern wave of gamers, whose fantasies are just as diverse as they are,” she added.

Wilson clarified that she’s not meaning to stereotype women as not enjoying fantasy games about things like warriors and dragons. Instead, Robin Games aims to expand the types of fantasies being explored through gaming — including those mobile gaming has yet to include.

While the company isn’t yet announcing its first titles or specific details, like launch dates, the games are said to cover content you’d typically find in a lifestyle magazine, on an Instagram influencer’s profile, or on a lifestyle blog, for example.

“We are focused on developing games that are deeply sophisticated under the hood, with an elevated, real-world, approachable style that reflects more of the lifestyle content you’d previously see outside of gaming,” Wilson told TechCrunch.

All this will be wrapped up in the free-to-play business model that powers most top-grossing games. In addition, Robin Games’ strategy will allow it to expand to include a partnership strategy, which will diversify its revenue streams further down the road.

 

Wilson said the idea for Robin Games was something she had in mind for some time, as she was personally looking for games to like this to play herself — only to find they didn’t exist.

“I’ve always designed products for myself first and foremost, which allows me to deeply connect with what the end-user really wants — since the end-user is me,” said Wilson. “Recently, I realized that not only did we have a unique answer to a pretty major gap in the market, but also that the timing was right and, most importantly, that we could pull together the exact right team to execute this vision.”

The startup is currently a team of nine based in Venice Beach. Management is 80% women and everyone had worked together to make hit games in years prior. In terms of hiring, the company is focused on building out a diverse team in order to better realize its vision, Wilson said, and, more broadly, change the face of the gaming industry as it stands today.

“Our mission goes beyond filling a gap in the market. We’re really looking to shake up the games industry, not only redefining what a modern game team looks like, but also changing the definition itself of what it means to be a gamer,” noted Wilson.

In previous studies, female players have been shown to prefer match-3 and social farming games, among others, with fantasy and MMOs further down the list, and sports and shooting games last. But the types of games Robin Games is proposing don’t really fit into any one category that exists today, so it’s still unknown how female gamers will respond.

However, it makes sense to target this underserved market, given that women account for 46% of all U.S. game enthusiasts.  

“Jill Wilson and her incredible team are already further along than most developers starting out,” added Are Mack Growen, partner at LVP and member of Robin Games’ Board of Directors, about the firm’s investment. “This team has developed and operated some of the world’s most successful games for a decade, and now they have assembled to bring premium experiences to the massively underserved audience of women. In addition to their industry expertise, they fundamentally understand their audience and the ingredients for powerful entertainment. We are proud to have led their seed round and look forward to helping them redefine what it means to be a gamer.”

 

 

Roblox raises $150M Series G, led by Andreessen Horowitz, now valued at $4B

Online gaming platform Roblox, now home to 115 million largely Gen Z players per month, announced today it has raised $150 million in Series G funding, led by Andreessen Horowitz’s Late Stage Venture fund. The company will also open a tender offer for up to $350 million of common and preferred shares, it says.

The company has previously offered stakeholders and employees liquidity through periodic secondary offerings, as it believes in its long-term potential. Roblox is also cash-flow positive, according to its CFO Michael Guthrie.

Others participating in the Series G include new investors Temasek and Tencent Holdings Limited, as well as existing investors Altos Ventures, Meritech Capital, and Tiger Global Management.

The funding comes at a period of significant growth for the gaming platform. Just last summer, it was being visited by 100 million users, topping Minecraft, and its developer community of over 2 million actives earned $110 million in 2019 — up from around $70+ million in 2018 and $40+ million in 2017.

Since then, Roblox has further invested in its developer business, with the launch of new tools for building more realistic 3D experiences and a marketplace where creators can sell their own development assets and tools to others, among other things.

Roblox offers a platform for its developers to build upon, similar to the App Store. Many of its most popular games are free, instead monetizing as players spend on in-game items using virtual cash called Robux. Some of its largest games average over 10 million users monthly. Over 10 games have seen more than 1 billion visits.

Players on Roblox often do more than just focus on completing a goal or task — they go online to hang out with friends in a gaming environment. Half of weekly active users go to Roblox to play with friends. In addition, half of Roblox users update their avatar every month.

In recent months, Roblox has also been working to take its platform further outside the U.S. including most notably China. Last year, Roblox entered a strategic partnership with Tencent in an effort to bring its platform and coding curriculum to the region, including by adding support for Chinese languages and running coder camps. Today, Roblox has players and creators in over 200 countries, it says.

As of last year, Roblox was valued at $2.5 billion, with roughly half of U.S. children ages 9 through 12 playing on its platform, according to comScore. This remains true today. In addition, its user base overall skews younger, with over 40% 13 and up.

The company is now valued at $4 billion, The Wall Street Journal reported. (TechCrunch additionally understands this to be true. Roblox isn’t commenting.)

Today, Roblox says its user base is spending a collective 1.5 billion hours per month on its service. And because it’s accessible across platforms, users often move from PC to smartphone to continue to play — a newer trend in online gaming, and one that’s also driving adoption of games like Fortnite, PUBG, and others.

“We are big believers in Roblox’s long-term vision, and are confident in backing the team as they enter this next inflection point,” said David George, General Partner at Andreessen Horowitz, of the firm’s investment. “Roblox is one of those rare platform companies with massive traction and an organic, high-growth business model that will advance the company, and push the industry forward for many years to come,” he added.

Roblox plans to leverage the new funds to continue its growth, including international; further build out its developer tools and ecosystem; and invest in engineering talent and infrastructure.

“We’ve stayed true to our vision of creating a safe and civil place where people come together to create, learn, and have fun, and it’s amazing to see what we’ve built together with our global creator community,” said David Baszucki, CEO and co-founder of Roblox, in a statement. “Looking ahead, we’re doubling down on our commitment to building the most advanced tools and technology to take our creators and players into the metaverse of the future.”

Updated, 2/26/20, 7:30 PM ET with more updated statistics.

This Week in Apps: the year and decade in review, gaming acquisitions and a Facebook OS

Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support and the money that flows through it all.

The app industry is as hot as ever, with 194 billion downloads last year and more than $100 billion in consumer spending. People spend 90% of their mobile time in apps and more time using their mobile devices than watching TV. Apps aren’t just a way to waste idle hours — they’re big business, one that often seems to change overnight.

In this Extra Crunch series, we help you to keep up with the latest news from the world of apps, delivered on a weekly basis.

Headlines

The top apps of the year… and the decade

App Annie this week released its list of the year’s top apps. And this time around, it also included the top apps of the past 10 years in its analysis. Outside of games, Facebook dominated the decade, the firm reported. It ran the four most-downloaded apps of the decade, including Facebook (#1), Messenger (#2), WhatsApp (#3), and Instagram (#4). Other communication and social media apps were also among the most popular over the past 10 years, claiming seven out of the 10 top spots, including Snapchat (#5), Skype (#6) and Twitter (#10). Social video platforms TikTok and YouTube also placed on the list at #7 and #9, respectively. And yes, it’s pretty notable that TikTok — an app that only launched outside of China in 2017 — is one of the most-downloaded apps of the past decade. Meanwhile, even though dating app Tinder was the most profitable app this year, Netflix was the No. 1 app by all-time consumer spend over the past decade.

2019 app downloads and consumer spending

Related to its round-up of the top apps, App Annie also offered some preliminary data on downloads and consumer spending in 2019. Its current figures don’t include calculations from third-party app stores in China, (like those referenced above), which App Annie tends to provide in its annual State of Mobile report. Instead, App Annie reports we’re on track to see 120 billion apps from Apple’s App Store and Google Play by the end of 2019, a 5% increase from 2018. Consumer spending was also up 15% year-over-year to reach $90 billion, it says. Expect a full analysis to come in Q1 2020.

Facebook still sat at the top of the charts for 2019. The company’s Messenger app was the most downloaded non-game app of 2019, followed by Facebook’s main app, then WhatsApp. Tinder switched places with Netflix for the No. 1 spot on this chart — last year, it was the other way around. (For more details, TechCrunch’s full review is here.)

2019 in Mobile Gaming

According to a year-end report by GamesIndustry.biz, mobile gaming grew 9.7% year-over-year in 2019 to reach a market value of $68.2 billion. The gaming market as a whole was worth $148.8 billion, the report said. Smartphone games were the biggest piece of this figure, at $54.7 billion, compared with $13.4 billion for tablet games. That means smartphone games are still bigger than PC, browser PC games, boxed and downloaded PC games, and console games.

Big moves in cloud gaming

To beef up its new cloud gaming service Stadia, Google this week bought game development firm Typhoon Studios, who were set to release their cross-platform title and first game, Journey to the Savage Planet. Google had said it wants to build out a few different first-party studios to release content on Stadia, which is where this acquisition fits in. Meanwhile, Facebook this week acquired the cloud gaming startup, PlayGiga, which had been working with telcos to create streaming game technology for 5G.

Stadia has a big mobile component, as its controller can play games on compatible mobile devices like Pixel phones. Gaming has been a big part of Facebook’s mobile efforts, as not only a platform where games can be played, but also a place to watch live game streams, similar to Twitch. But the big gaming trend of the past year (which will continue into 2020) is cross-platform gaming — thanks to games like Fortnite, Roblox and PUBG Mobile, as well as devices like Nintendo Switch, gamers expect to continue playing no matter what screen they happen to be using at the time.

Apple Developer app expands support for China

Apple launched a dedicated mobile app for its developer community in November, with the arrival of the Apple Developer app, which was an upgraded and rebranded version of Apple’s existing WWDC app. The app lets developers access resources like technical and design articles, as well as read news, watch developer videos, and enroll in the Apple Developer program. Now that the program is open to China through the app, Apple announced this week.

From the app, developers in China can start and complete their Apple Developer membership and pay with a local payment method on their iPhone or iPad. They can also renew their membership, to keep their account active. Apple has been heavily investing in growing its international developer community by launching developer academies and accelerators in key regions, among other initiatives. Over the past year, Apple grew its developer community in China by 17%, the company earlier said.

So much for nostalgia, Rewound gets yanked from the App Store

We hope you downloaded this fun app when we told you to in last week’s column! Because now it’s gone.

Rewound, briefly, was a clever music player app that turns your iPhone into a 2000’s era iPod, complete with click wheel nav. The developer was able to sneak the app into the App Store by not including the actual iPod UI, which infringes on Apple’s own product design. Instead, the UI pieces were hosted off-site — on Twitter accounts, for example. Users could find them and download them after they installed the app. Technically, that means the App Store app itself wasn’t infringing, but Apple still kicked it out. The developer also charged a fee to access the Apple Music features, which may have been another reason for its removal.

It’s no surprise Apple took this step, but the developer seems confused as to how the app could be approved then pulled later on, even though it hadn’t changed. That’s actually par for the course for Apple’s subjective, editorial decisions over its App Store, however. Now Rewound, which has 170K+ users after only a few days, will focus on a web app and Android version.

Facebook is building its own OS so it can ditch Android

This Week in Apps: Apple Arcade updates, TikTok distances itself from China, Kardashians send shady app to No. 1

Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support and the money that flows through it all. What are developers talking about? What do app publishers and marketers need to know? How are politics impacting the App Store and app businesses? And which apps are everyone using?

This week, we’re discussing the impact of the CFIUS investigation into TikTok, the further fallout of Apple’s vaping app ban, updates to Apple Arcade and Google Play Pass subscription-based app stores, Apple’s breaking changes that rolled out without warning (thanks, Apple!) and a shady app that reached the top of the App Store thanks to a big Kardashians-led endorsement, among other things.

Headlines

TikTok separates further from its Chinese parent

One of the world’s most downloaded and used apps, TikTok, is under a national security review in the U.S. because of its Chinese roots. TikTok parent company, ByteDance, is a China-based operation — something that has raised concerns because of its significant access to U.S. users’ personal data and potential censorship issues.

The company was already working to separate itself further from China before the Committee on Foreign Investment in the United States (CFIUS) began its investigation. For example, it separated the TikTok product, business development, marketing and legal teams from those of its Chinese app, Douyin, and hired consultants to audit how it’s storing U.S. users’ personal data. Following the investigation, it hired more U.S. engineers and set up a U.S.-based team to oversee data management, Reuters reported.

The question now is whether not these moves — along with a promise to not store U.S. user data in China — will be enough. The app collects data including profile information such as name, age, email and phone number, provided by users, as well as photos, videos, and location. Many of TikTok users are younger teens and college students.

Even if you’re “too old” to care about TikTok, CFIUS investigation’s conclusions here will have a larger impact on the global app industry, as they’ll set precedents as to how foreign powers can compete in U.S. app stores.

Oops: Apple releases breaking changes with no warning 

Apple this week introduced new server-to-server notifications for subscriptions that allowed developers to receive real-time updates in a subscription’s status, so they could provide customized experiences for subscribers. Only one problem with the release: Apple broke most server notifications implementations as a result. Developers weren’t given any warning about the APIs that were “scheduled for deprecation,” either, which is not typically how web APIs are managed. To add icing to the cake, not only were the changes released without warning, they were also rolled out on a Friday — there goes the weekend. Thanks, Apple.

The vaping app ban backlash continues

Has Apple crossed the line between protecting its users from dangerous apps to just turning into an overbearing parent policing adults’ ability to make their own choices? Over the past couple of weeks, several have said the latter. Now concerning are arising about what this means for the overall industry and whether or not decisions like this should even be in Apple’s hands in the first place.

As you may recall, Apple earlier made a controversial decision to remove all 181 vaping-related apps from its App Store in wake of news from the CDC about the 47 vaping deaths and thousands of lung injuries. Some early studies point to Vitamin E acetate, an addictive used in THC oil, as the cause. But Apple isn’t worrying about the details of what’s dangerous and what’s not — it just wiped out anything vaping-related, including things like Bluetooth-connected apps that let users control aspects of their vaping devices, like the lights, heat, and updates to the firmware. There’s no backup plan here for those app makers, since web apps don’t offer the same level of functionality. Plus, the ban is also impacting devices used to distribute medication as well as apps designed to help people cut down and eventually quit smoking and vaping by tracking their nicotine usage.

For app entrepreneurs, Apple’s decision in one fell swoop also just destroyed half the vaping app market as their apps will now only run on Android.

The question now is whether or not any of this should be Apple’s decision? While you may personally applaud a vaping app ban — or simply not care because it doesn’t affect you — Apple has made other controversial choices that have a more serious impact. Like when it kicked out the app that aided Hong Kong protestors, for example.

Apple Arcade and Google Play Pass expand their collections

Apple’s subscription-based gaming store and Google’s rival subscription app store, Google Play Pass, have both added new apps since their debuts. Now, the two companies are making users aware of their ongoing efforts to beef up their respective collections. Apple this week shared a video that highlighted over a dozen new Apple Arcade releases that hit this month — the first time it’s released a compilation video featuring multiple titles since its launch.

Meanwhile, Google Play Pass added 37 more apps to bring its total to 274.

What we don’t know yet, is how well the two services are working — or whether they will benefit developers in the long run. And because neither has a Top Charts section, it’s not even clear what apps are most popular or how many downloads they’re seeing.

Apple Arcade adds a “Top Games” chart… well, sorta… OK, not really

Apple took a step to address the above problem with a new section in Apple Arcade called “Top Arcade Games This Week.” We had argued earlier that the lack of visibility into the popularity of titles on Arcade was a disservice to users who wanted quickly and easily find the most popular titles.

But this new section, while fun, doesn’t solve the problem. Top Games, based on what? Downloads? Editorial curation? Both? Is there going to be an API for it?

It’s common knowledge that the App Store’s Top Charts are based on a combination of downloads and velocity. And that data is accessible to third parties like App Annie, Sensor Tower, Apptopia and others who use it to come up with download estimates.

But a “Top Games This Week” section is not the same thing as a real Top Charts section. And by limiting it to only a week’s time, it provides no real insight into whether or not the Arcade is able to produce a lasting hit the way the App Store can, or what those hit titles may be.

Apple has distanced itself from promoting the Top Charts as a means of app discovery for years now. With its big App Store makeover, it shifted its focus more to editorial, curation, and recommendations, rather than downloads. But for a smaller store like Arcade, Top Charts could have value as they would feature some of the best titles from an already exclusive collection — that’s something people would want to see.

Why was a shady photo editor the top app of October?

This Week in Apps: Photoshop for iPad bombs, Google Play’s new rewards program, iOS bug fixes

Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support, and the money that flows through it all. What are the developers talking about? What Do app publishers and marketers need to know? How is international politics playing out in the App Store? What apps is everyone using?

As November kicks off, we’re looking at a number of big apps launches from Microsoft and Adobe — as well as what went wrong. We’re also looking at the iOS bug-squashing release, a bunch of data about app install trends around the world, Google Play’s new loyalty program and what it means for developers, the continued scrutiny of Chinese apps by the U.S. government, and more.

Fast Facts

eMarketer remindS us that it recently put out a big report on app installs with a ton of insights. It’s actually been live for a few months, but ICYMI, here are some of the key data points and highlights:

  • The average iPhone user in the U.S. downloaded 47 apps in 2018, up from 44 in 2017.
  • The average number of apps installed is rising — up 15% from 2016. In the U.S., Japan, South Korea, and Australia, users had more than 100 apps downloaded in 2018.
  • Smartphone users spend the most time using their top 5 apps. In 2017, the top 5 accounted for 87% of usage. Now (Apr. 2019) it’s 83%. The No. 1 app had a 49% share of the time spent, now it’s 44%.
  • The number of smartphone users in the U.S. will grow just 3% in 2019, compared with 13.2% in India and 12.1% in Indonesia.
  • Related, app downloads grew 165% in India from 2016 to 2018. In China, 70%. In Indonesia, 55%. And in Brazil, 25%. The U.S. app downloads grew just 5%.
  • In June 2019, the App Store had 1.8 million apps compared with Google Play’s 3.1 million.
  • 43% of iOS app install referrals came from Facebook properties, and only 6.6% came from Google properties.
  • Apple Search Ads drove 12% of non-organic installs in May 2019.
  • In-app video ads outperform display ads. Install-to-register rates for video were 35.1% in Q1
    2019 on the Liftoff network, compared with 28.5% for display ads.
  • App engagement drop-off rates after day one are the biggest in shopping apps. (25% engagement after the first day, but 8% at 30 days). Travel also sees a big drop-off. (20% after the first day and 6% after 30 days).

Headlines

iOS Bug Squashing: Apple fixed the iOS bug that killed your background apps. Apple this week finally squashed a very annoying bug in iOS 13 that made the OS overly aggressive about killing background apps and tasks. Apps like Safari, YouTube, Overcast and others were impacted, leading users to lose emails or the video they were watching just when they switched away for a few seconds. What Apple can’t fix is a growing concern that Apple has “lost the plot” following a series of extremely buggy software updates across its product line, which made users hesitant to upgrade to macOS Catalina, and bricked people’s HomePods.

Google admits it can’t secure the Play Store on its own: Google this week announced partnerships with security firms ESET, Lookout, and Zimperium to form what it has branded the “App Defense Alliance.” The goal, the company says, is to unite the security industry to fight malicious apps across Android’s ecosystem of 2.5 billion devices. Basically, Google will integrate its own detection systems with each partner’s scanning engine to help it uncover potential risks and threats. However, the fact that Google is now essentially outsourcing security to a partner ecosystem is an admission of failure, to some extent, about its abilities to keep the Play Store free from bad actors on its own. (But of course, we all knew that already, right?)

Photoshop for iPad is tanking: Adobe released its most important mobile app ever with this week’s launch of Photoshop for iPad. But fans panned the app because it’s missing several key features. Like RAW support! The app now has 2 stars out of 5…yikes. So what went wrong?

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