Greetings and welcome back to This Week in Apps, the regular TechCrunch feature providing an update on the newest developments in mobile operating systems, mobile applications, and the broader app marketplace.

The mobile app sector continues to thrive, achieving a remarkable 204 billion total downloads and $120 billion in worldwide consumer expenditure during 2019. Excluding app stores operated by third parties in China, iOS and Android platforms saw 130 billion app downloads and a record $112 billion in user spending in 2020. In 2019, individuals dedicated an average of three hours and forty minutes daily to app usage, comparable to the time spent watching television.

The impact of COVID-19 resulted in a 25% increase in time spent within apps on Android devices compared to the previous year. Apps are not merely a source of entertainment; they represent a significant commercial opportunity. Companies prioritizing a mobile-first strategy held a collective valuation of $544 billion in 2019, which is 6.5 times greater than companies without such a focus.

This installment (following a break for the holidays) will cover holiday-season app store revenue, the effects of Chinese game licensing regulations on the App Store, Apple’s decision to remove an application with potential to facilitate the spread of COVID-19, and a musical composition collaboratively produced by TikTok users, as well as other relevant topics.

Top Stories

Christmas Day app expenditure increases by 35% compared to the previous year

According to data released by Sensor Tower, worldwide app revenue remained strong in 2020 despite the ongoing pandemic. The report indicates that users allocated $407.6 million to applications available on the iOS App Store and Google Play on Christmas Day, representing a 34.5% rise from the $303 million spent during the same period in 2019. The largest portion of this expenditure was directed towards mobile gaming, experiencing a 27% year-over-year increase to $295.6 million. Honor of Kings, developed by Tencent, was the top-performing game, while TikTok generated the highest revenue among non-game applications, with $4.7 million in spending on Christmas Day.

Consistent with previous trends, Apple’s platform facilitated the majority of the spending, totaling 68.4% ($278.6M) in contrast to Google Play’s $129M. The United States contributed significantly to this total, accounting for approximately $130 million in expenditure.

Apple Addresses Concerns Regarding Pandemic Parties

While Apple’s App Store Review guidelines do not explicitly outline procedures for managing applications potentially facilitating the transmission of COVID-19, the company demonstrated its position on the matter by taking action against a social application promoting risky behaviors. Recently, Apple removed Vybe Together, an app that enabled users to find “private” indoor parties, some of which were in direct contradiction to established public health regulations.

The issue initially gained public attention through a post by New York Times journalist Taylor Lorenz. The application had been utilizing TikTok for promotional purposes, but that account has since been taken down. In response to its removal, the app’s creators asserted that it was intended solely for limited-size social events, with the founder expressing frustration at being “canceled by the liberal media.”

However, there is limited justification for supporting an application that actively encouraged gatherings of individuals from separate residences, thereby contributing to the spread of COVID-19. The app’s founder appeared unaware, based on recent social media posts and statements on the app’s website, that numerous cities and states had already implemented restrictions on private gatherings – even those of the size he considered acceptable, such as small parties within individual apartments among local residents.

The United States has experienced 346,000 deaths attributed to COVID-19, and in New York, where the app was advertising New Year’s Eve events, 74% of all COVID-19 cases between September and November 2020 were traced back to private social gatherings.

Although media outlets brought attention to the app’s activities, the ultimate decision to remove it from the App Store rested with Apple. This was a justified and appropriate course of action.

Apple Removes 39,000 Games From Its China App Store.

On Thursday, December 31, 2020, Apple eliminated over 39,000 games from its China App Store. Reuters reported, based on information from Qimai, that this represented the largest single-day removal of games to date.

For a long time, games intended for use on iOS have been legally required to possess a Chinese gaming license to function within the country. However, Apple previously bypassed this regulation for several years by hosting titles that lacked the necessary license, while Android app stores adhered to the rule. Apple began enforcing the requirement in 2020, providing publishers with a deadline of December 31, 2020, to secure the license—a process that can be both lengthy and complex.

Evidently, a substantial number of publishers were unable to meet this deadline. The recent removal included popular titles such as Ubisoft’s Assassin’s Creed Identity and NBA 2K20. Qimai indicates that following the removals, only 74 of the top 1,500 paid games remained. The report also stated that Apple has now removed more than 46,000 titles in total from the China App Store.

TikTok Gives Rise to a “Ratatousical”

The TikTok-created musical adaptation of Ratatouille has evolved into a genuine production. The year 2020 brought job losses for many creative professionals, prompting them to explore new avenues for self-expression online. On TikTok, this collective energy manifested as a large-scale collaborative project: a musical version of Disney’s Ratatouille. (Often referred to as Ratatousical.) TikTok users contributed by composing music, writing lyrics and dialogue, choreographing dances, and designing costumes and sets, all within the app.

Surprisingly, Disney is permitting a charitable version of this collaboration to proceed as a live event without any legal challenges. The Ratatouille musical was live-streamed on January 1 at 7 p.m. Eastern, and remains available via video-on-demand through January 4, with a minimum donation of $5 to The Actors Fund.

The musical was designed to be lighthearted entertainment for a younger, Gen Z audience. It also cleverly integrated actual TikTok videos, incorporating the app’s signature visual effects—such as cloning and the flashing colored lights associated with the “you think you can hurt me” meme—making it more relatable and familiar to viewers accustomed to internet-based entertainment.

It’s worth noting that TikTok users are not alone in utilizing remote and collaborative processes for creative production in 2020—Hollywood itself has had to adapt to remote work on a much larger scale. TikTok simply provided a platform for theater enthusiasts to pursue their creative endeavors.

It remains to be seen whether the TikTok-based collaborative process that produced this musical will prove to be a unique event resulting from the circumstances of the pandemic—including the increased availability of time and resources for creative individuals due to production shutdowns and stay-at-home orders. Or perhaps in-app collaborations have a sustainable future? Only time will tell.

TikTok has already demonstrated its ability to influence music charts, fashion trends, and app downloads, suggesting it can also attract an audience for this production. However, one might question whether the event would have garnered as much attention and excitement if it were based on an entirely original work, rather than a beloved Disney property. Nevertheless, it’s worth watching—given the current lack of alternative entertainment options.

Weekly News

Platforms

• According to Flurry data, the iPhone 11 was the most activated device on Christmas Day 2020, experiencing a 5% increase in activations compared to the seven-day average between December 18 and December 24. However, overall new smartphone activations decreased by 23% year-over-year, likely due to economic difficulties caused by the COVID-19 health crisis, including delays in stimulus payments.
• Google’s search engine on mobile devices is now integrating short-form videos from apps such as Instagram and TikTok. In select search results, Google displays a carousel of short videos as part of a pilot test.
• App downloads increased by 33% in 2020, a 25% rise compared to 2019, according to data from AppsFlyer. Mobile marketers spent $74.6 billion globally to drive installs, a slight decrease from the $74.2 billion spent in 2019.
• Apple has patented multi-user technology for iOS. Hopefully, this patent will lead to a product release, a desire shared by many households with shared iPads.

Gaming

• Samsung has partnered with Epic Games in the dispute with Apple over Fortnite. Samsung and Epic Games collaborated on the “Free Fortnite” marketing campaign, which recently involved sending packages to influencers containing a Free Fortnite bomber jacket and a Samsung Galaxy Tab S7. Fortnite was the Samsung Galaxy Store game of the year in 2020, and the store also distributes the Epic Games app, which provides Fortnite updates. This action is noteworthy as Epic alleges that app stores exploit their power to engage in monopolistic practices, but it demonstrates that Samsung is offering them a distribution channel. Apple maintains the right to set its own pricing for its services (and recently lowered commissions for small businesses). Even if Epic Games isn’t the advocate one might hope for, its lawsuit could establish important precedents. Regulators may also eventually determine that Apple cannot dictate rules for businesses operating outside its app store—meaning they should have the right to process their own payments, for example.

Augmented Reality

The New York Times is exploring AR gaming. The media company has experimented with augmented reality to enhance storytelling both within its app and on social media. It has now extended AR into gaming with an AR-enabled crossword puzzle where users rotate broken pieces floating above the puzzle to uncover clues.

Social & Photos

Telegram is beginning to generate revenue. The messaging app, approaching 500 million users, will introduce an ad platform for its public one-to-many channels that is designed to be user-friendly and respect privacy. The company states it needs to generate income to cover server and traffic costs. Telegram previously abandoned a blockchain token project due to regulatory concerns.

Mr. Beast has announced the second annual “Finger on the App” challenge on February 19. The game awards $100,000 to the individual who can keep their finger on their smartphone the longest, using an app designed for this purpose. Last year, the prize money was split four ways after 70 hours. The new app includes in-app challenges to prevent cheating. YouTuber Mr. Beast gained prominence for his philanthropic-based viral videos and stunts, including substantial donations to those in need and those affected by the pandemic. However, this year’s game has a more somber tone, as competitors may be in more desperate circumstances.

Bumble faced criticism over its policies regarding indoor bikini and bra photos. The dating app found itself in a debate when a woman’s photos in her bra were removed. The company stated its policy prohibits images such as shirtless bathroom selfies and indoor photos of people wearing swimwear and underwear. Bumble’s policies were developed based on user data and feedback, and may also help prevent spam from adult sites. However, some find it unusual that an app marketed as female-friendly would ask a woman to put on clothes.

ByteDance filings reveal TikTok U.K. business recorded a $119.5 million loss in 2019. The losses were attributed to advertising and marketing expenses, indicating the app is still in a growth phase.

TikTok has launched its first personalized annual recap feature. The company’s “year on TikTok” in-app experience joins other personalized summaries like Instagram’s Top Nine or Spotify’s Wrapped. It also introduces a floating, tappable button to connect users to the experience, potentially paving the way for other in-app applications.

Clubhouse power users have been invited to a special club. A select group of creators within the already invite-only audio conversations app now have exclusive access to tools and private meetings with Clubhouse leadership and influencers. During one meeting, the creators discussed monetization strategies. The app gained popularity during the pandemic as people were unable to engage in traditional networking, but it has also struggled with moderation as conversations become inappropriate. Clubhouse also hosts many adult topics, which would result in a 17+ rating if submitted to the App Store instead of remaining in private beta.

Streaming

• HBO Max’s mobile app set a single-day download record following the release of “Wonder Woman 1984.” During the release weekend (Friday-Sunday), the app saw 554,000 downloads, including 244,000 downloads on Sunday alone, according to Apptopia. The firm estimates the app now has just under 12 million mobile users.

Health & Fitness

• Five popular menstruation apps—Clue, Flo, Maya, MIA, and Oky—have been criticized by U.K.-based charity Privacy International for collecting and storing “excessive” information about users’ personal health and habits. The organization argues that these apps should function without requiring registration and should store data on the device itself.

Government & Policy

• The U.S. government appealed the injunction against its TikTok ban on December 28. Two U.S. judges had already halted the implementation of Trump’s executive order. U.S. District Court Judge Carl Nichols determined on December 7 that the Commerce Department had exceeded its authority and declared the action “arbitrary and capricious.” The department stated it would continue to pursue the ban, filing the appeal this past week. The outcome of this case remains uncertain with the upcoming change in administration, but many suspect it could be dropped as the new administration focuses on more pressing issues, such as the COVID-19 crisis.
• Zoom is under investigation by the U.S. Securities and Exchange Commission and two U.S. Attorney’s offices regarding its interactions with China and other foreign governments, as well as security and privacy concerns.

Security & Privacy

• Let’s Encrypt, a free, automated, and open certificate authority, has found a way to continue supporting older Android devices. Expired certificates would have disrupted apps and browsers.

Funding and M&A

Tappity has raised $1.3 million for its interactive and educational video library for children. The Y Combinator-backed startup uses live-action actors responding to children’s actions to teach standards-based science.

Yuanfudao, an edtech startup backed by Tencent, has raised $300 million from Jack Ma’s Yufeng Capital. The company earned $1.53 billion USD in 2020 and offers a range of remote learning products, including the Yuanfudao live tutoring platform, Zebra AI Class, the Yuantiku online question bank, the Xiaoyuan Souti question searching app, and the Xiaoyuan Kousuan arithmetic problem checking app.

Zuoyebang, a Chinese edtech app and competitor to Yuanfudao, has raised $1.6 billion in a round led by Alibaba. The company provides online courses, live lessons, and homework help for K-12 students, and has 170 million monthly active users.

Fluent Forever, a language learning app, has raised $4.9 million in a round led by Denver-based Stout Street Capital. A competitor to Duolingo and Babbel, the app uses personalized learning, ear training, visual aids, and spaced repetition to help students learn new words and phrases.

Liftoff, a mobile app marketing firm, has raised $400 million from New York-based investors Blackstone Group. Liftoff currently delivers over a billion ads per day across over 500,000 mobile publishers.

Verse Innovation, the parent company of Dailyhunt, has raised $100 million from Google, Microsoft, and Falcon Edge’s Alpha Wave Incubation, valuing its business at over $1 billion. The company will use the funds to expand its short-form video app, Josh, and other initiatives.

Glance and Roposo, mobile app marketing firm InMobi’s platforms, have raised $145 million in a round led by Google. Glance provides a lockscreen that displays personalized content when the phone is locked, and Roposo is a video-sharing social platform acquired by InMobi in November 2019.

Downloads

Yayzy

This U.K. startup’s new app calculates the environmental impact of purchases using payment data via Open Banking standards. Users can then adjust their spending or purchase offsets within the app to achieve carbon neutrality. iOS only.

Waterscope

Iconfactory, the creator of many popular apps, has released Waterscope, a weather app specifically designed to provide information on water conditions. Creator Craig Hockenberry explains he largely built the app for personal use, as an ocean swimmer often needing information about tides, wave heights, water temperature, wind speed, air temperature, and forecasts. The app could be useful for anyone who lives near the water, whether they swim, fish, boat, or engage in other activities.

Run Boggo Run

This endless runner is BuzzFeed’s first mobile game, making it noteworthy. The mental health-themed game, inspired by BuzzFeed’s animated series The Land of Boggs, was created by BuzzFeed Animation Studios. Players attempt to avoid obstacles like stress monsters and gremlins, a humorous take on the anxieties of 2020. However, initial user reviews indicate the game’s controls are difficult and the game is not enjoyable. $0.99 on iOS and Android.

Enso

The new meditation game Enso promises to help users relax, meditate, or fall asleep faster using gameplay that incorporates soothing visuals and sounds composed by A.I. The app consists of 5-minute journeys where users concentrate on a task while guiding their movements and breath to achieve their goals. Available on iOS and Android.

Portal

Not Facebook’s Portal! This sleep and relaxation-focused app, also called Portal, has been updated to align with Apple’s new privacy measures. The company announced in December it will not collect user data from its app and will no longer use in-app analytics tracking. The app never required a login or collected personal information and does not include third-party ads or ad trackers.

This has resulted in a rare find on the App Store:

How refreshing.

The Portal app is available for free and offers a $35 per year membership for access to the full content library.