Why There's Less Room For 'Explosive Growth In Smartphones' Than Before

Apple Inc. AAPL and Google Inc GOOG have enjoyed years of smartphone growth, but that could come to an end as the market reaches its saturation point.

"Essentially, we are starting to reach a point where everyone has a smartphone, so there is less room for the explosive growth in smartphone ownership and usage compared to what we've seen over the past five to seven years," Jordan Cohen, CMO of Fluent (an advertising technology company), told Benzinga.

Cohen analyzed a new report from Bank of America regarding Internet and e-commerce traffic. The report said that "Google mobile time spent" was up 49 percent year-over-year versus 52 percent growth in June. Total U.S. minutes for all Facebook Inc FB sites were up 29 percent year-over-year.

"There's no big surprises here, mobile continues to grow," said Cohen. "However, there seems to be some deceleration of that growth relative to last year. This is in line with what we are seeing across Fluent's online advertising network, with mobile levels beginning to stabilize in the 60 to 70 percent range in terms of what devices consumers are using to view ads."

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Fluent has worked with a number of well-known brands, including Amazon.com, Inc. AMZN, PepsiCo, Inc. PEP, Pandora Media Inc P and Wal-Mart Stores, Inc. WMT, to name a few.

"It is a little odd (from where we are sitting) to see the report say that more online minutes are still spent on PCs than on mobile devices," said Cohen. "Perhaps the larger number of minutes spent on PCs are 'inactive' minutes -- meaning people are connected to their PCs all day long, even when they're not actively consuming anything online, whereas on mobile they are more active users."

'Material Deceleration'

Sean Udall, CIO of Quantum Trading Strategies and author of The TechStrat Report, told Benzinga that "some" of the report matters.

"If you are a Web-based company and you have material deceleration over a long period of time, that's gonna ultimately mean that your company can't grow to the size that it theoretically could," said Udall. "I actually don't think a lot of these metrics are necessarily gobbledygook. They're useful, [but] I think a lot of the metrics are overstated."

Udall said there are some investors who tend to draw false conclusions to metrics and other information about a company.

"If you're focused on a lot of this stuff to the degree that you're ignoring the earnings reports and the way the earnings reports are unfolding, then yeah, you are looking at a lot of gobbledygook," he said. "I see a lot of people take numbers and misinterpret them."

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.