Startable – Healy Jones’ & Prasad Thammineni’s Blog

Adobe has some research that highlights how important tablets are becoming for driving web traffic (thanks to Mediapost for a great write up on this.)  I’ve said it many times, we are seeing this first and foremost with the traffic both to the OfficeDrop website and engagement with the OfficeDrop iPad app.

Some great quotes on how tablets are driving a ton of traffic from the MediaPost article:

• “The share of Web site traffic on tablets grew more than 300% in the past year”
• Tablet share will reach 10% of all traffic by 2014 (that’s it? I bet it will be more!)
• “Within one year of the iPad launch in Q2 2010, tablet visits represented 1% of total Web site visits, reaching 4.3% of total visits one year later, up more than 300%.”
• “Tablets generated 4.3% of total Web site visits, compared with smartphones at 6.1%, in Q1 2012″
• “Approximately 68% of tablets shipped were iPad devices, yet they generated 83% of the combined visits from iPad and Android tablets through December 2011. For every brand Web site visit made with an Android tablet, 2.3 visits were made with an iPad, according to the study.”
• “Apple iPads generate 490% as many Web site visits as Android tablets, although iPad shipments are 210% of Android shipments.”

So, key take aways are that iPad users are more engaged on the web than Android tablets, but still tablets are a huge source of traffic for all sites. Consumers and small businesses are using these devices for a lot, including surfing the web.

However, one place where they are not being used as much – so far – is for buying stuff, “… for transactional visits on retail and travel sites, consumers are between 30% and 60% more likely to purchase using a PC.” I bet that is a UI thing that can be solved with better shopping carts and shopping apps.

Some good research out today from Comscore on the top mobile properties. Both TC and Mediapost wrote about it. The following is a quote from the Mediapost piece:

“apps account for the vast majority, representing 4 of every 5 mobile media minutes. But the Web/app split varied among top properties. On Facebook — the top property by engagement at more than 7 hours in March — 80% of time spent was on apps compared to 20% via browser. Twitter had an even higher percentage of time spent with apps, at 96.5% of all minutes. Microsoft, by contrast, was among brands that saw browser access driving a majority of usage, at 82.1%.”

The key point continues to be that mobile is dominating usage. And an amazing thing is that the Twitter users spend more time with the mobile app than they do on their computer accessing Twitter’s web site.

I still don’t understand why people start non-mobile tech companies these days!

I (Healy Jones, for all you search engine bot’s out there) spoke at last week’s BusinessInsider Startup 2012 event in NYC. The topic was David vs. Goliath – how small companies can compete against big players like Google and Apple.

Julia Kenney of TMCnet infoTech Spotlight covered the speech with a nice write up. You can read her article here, in the cloud storage channel, called “How to Compete with Apple and Google.”

One of the blurbs from my talk that she quoted was:

“It all has to do with being lean,” said Jones. He noted how long it takes companies such as Google and Apple to launch anything because of all the administrative processes required before any decisions can officially be made.”

Hopefully BI will post some video from the event so I can link to it as well.

Every now and then a respected author comes out with an article along the lines of “the internet doesn’t create any innovation/productivity/well being/whatever.” The most recent is a well written post by an editor at the Harvard Business Review.

Of course, I disagree. And I’ve written a rebuttal on Bostinno titled “3 Reasons HBR is Wrong, the Internet is Not Overhyped.” My basic premise is that the internet is creating real industries, communication tools and well being. I won’t go into more, you can just read the article yourself on Bostinno.

Venture capital funding in the first quarter 2012 really dropped. I was assuming this was because of a big decrease in later stage investing, but that’s not the case. In fact, later stage venture investing was up 11% in Q1.

peHUB has a very good guest post from a VC on the funding drop. Below is a chart showing the rise and the fall of venture fund investments in the US over the years.

The peHUB piece has a very interesting quote on seed investing:

  “End of the Great Seed Experiment” which is something I have been saying for the better part of a year – there was only $141MM invested in 53 deals in 1Q12 (admittedly I think that number is under-reported) as compared to $156MM and 90 deals in 4Q11 and strikingly to the $211MM and 86 deals in 1Q11. I have been on this thread for some time; that is, the VC industry is at risk of having created too many “me too” companies, and with less capital to invest across the board, many seed entrepreneurs will be deeply saddened when they come back to market for their Early round…

Viacom research is suggesting that tablets are now the number 2 way to view a TV show – surpassing both laptops and smartphone usage as a TV show viewing device.

Here are the key findings, as quoted from the Viacom blog:

• In just a few years, tablets have risen to second-screen prominence for full-length TV (FLTV) show viewing, ahead of computers. Yet, television still provides the better experience.
• Tablets provide complementary experiences to TV viewing via second-screen experiences and co-viewing apps like MTV’s WatchWith.
• MSO app users, Netflixers, Apple TV owners, AirPlay users and Whispersync users report higher levels of FLTV show watching on tablets. Over one-third of both AirPlay and Whispersync users say they watch more TV on their tablets because of these apps.
• Tablet owners report emotional connections to this device unlike any other in the household – more than 50% of respondents said their tablet makes them feel happier and more relaxed, 49% said tablets make them more effective at managing life and 39% said tablets boost creativity. (end quote)

Tablets are pretty amazing devices. It’s pretty obvious that they are taking consumer mind share from laptops.

Check out Viacom’s blog post and press release.

I’m interviewed on NPR this morning! Very cool stuff.

The piece was about startup real estate in Kendall Square, the leading innovation district in Boston.

I (Healy Jones) am interviewed by well known NPR reporter Curt Nickish about our quest to find new office space. OfficeDrop is growing, and we are striking deals with large companies, so we want to move into better digs.

The piece pokes a little fun at our dog-centric culture, and is a good listen to anyone who knows the Boston startup ecosystem.

Some of you may know my complaint that the VCs are moving into Kendall driving up the rent. The piece goes a bit deeper and talks about how big companies are gobbling up all the real estate. And driving up rent for little companies like us.

Gartner is predicting that Software as a Service will hit $14.5 billion in 2012. 17.9% growth off the previous year – not bad at all.

SaaS grow should stay robust until 2015 when Gartner says it will be $22.1 billion.

I happen to think it will stay strong beyond 2015, but I’m pretty sure that this just a limit of how far out Gartner wants to make a prediction at this time, not an actual limit of how long SaaS will continue to grow.

A quote from the release: “After more than a decade of use, adoption of SaaS continues to grow and evolve regionally within the enterprise application markets,” said Sharon Mertz, research director at Gartner. “Increasing familiarity with the SaaS model, continued oversight on IT budgets, the growth of platform as a service (PaaS) developer communities and interest in cloud computing are now driving adoption forward.”

Another cool thing about the Gartner press release is that it’s dated May 27, 2012 – they are really forward thinking over there!

North America Leads SaaS Adoption

According to the release,  ”North America, specifically the U.S., currently represents the largest opportunity for SaaS, and it is the most mature of the regional markets. SaaS software revenue is forecast to total $9.1 billion in 2012, up from $7.8 billion in 2011. Consistent with other regions, North America shows the highest SaaS deployments in expense management, financials, email and office suites. Use of Web conferencing is higher in North America than in other regions, in part because of a highly distributed workforce.”

Tablet Sales to Surpass PC Sales

Check out the interesting piece on Business Insider.

BCG has just released a report explaining that the internet “industry” is 4.7% of the US economy. (Read about it on CNN here.)

The internet now contributed $684 billion to the US economy – more than the federal government, agriculture, etc. It also continues to rapidly grow, and this had implications for other sectors.

For example, the report also talks about the value of internet to small enterprises.”In multiple countries—including China, Germany, Turkey, and France—small and medium enterprises (SMEs) that have engaged actively with consumers on the Internet also have experienced three-year sales growth rates up to 22 percentage points higher than those of companies with low or no Internet presence, according to the report.” (Read this here.)

Go internet go!