- Netflix, the video streaming service whose subscriptions grew 20% to about 104 million in the past 12 months, also boosted revenue from its mobile application by 233% to $153 million during the second quarter of 2017, according to a report from researcher Sensor Tower. Many new Netflix users are signing up with their phones and paying through in-app purchases, per the report.
- Netflix outpaced the 56% average non-game in-revenue growth during the quarter for Apple App Store and Google Play apps. Hulu, another video streaming service with several tiers of service including a live TV package, had 22% growth in app revenue during the quarter.
- The top 10 non-game apps by revenue in the U.S. in Q2 2017 were Netflix, Pandora, Tinder, HBO Now, YouTube, Hulu, Google Drive, Spotify, live.me and Match, according to the report.
Sensor Tower's data indicate that Netflix's mobile revenue is growing much more rapidly than overall sales. The streaming company impressed investors last week with subscriber growth that exceeded forecasts, especially among users outside the U.S. Netflix's Q2 2017 sales rose 32% from a year earlier to $2.79 billion, including revenue from mobile, desktop and set-top boxes.
Netflix continues to draw viewers with original content that keeps people binge-watching and engaged on the platform, unlike competition like Hulu, which has some original series — notably "The Handmaid's Tale" — but are more focused on re-runs from network TV. Netflix described plans to invest $6 billion in original content this year including 40 feature films. Its big-budget productions include $90 million in a fantasy epic starring Will Smith and a mob movie by director Martin Scorsese. While many observers attribute the decline in cable TV viewership to Netflix's popularity, one analyst said that Hulu is actually motivating more people to "cut the cord," as its basic service replaces many shows that air on cable TV for a smaller fee.
The report also highlighted some broader app trends, with non-game app downloads up 12% during Q2 for a total of 13.2 billion. New non-game app installs grew 3% on Apple's App Store and 18% on Google Play. However, Apple still generates more revenue off a smaller and slower growing number of app installs. Apple's App Store saw revenue grow 52% for a total of $1.9 billion during Q2 while Google Play's revenue grew 72% for a total of $506 million.
While some brands have backed off mobile app development, the report suggests there is still an opportunity to drive engagement and potentially revenue through apps.