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Trends Tracker

Companies covered: AAPL, AMZN, ANGI, BABA, BBRY, CMCSA, CMG, COST, DISH, EBAY, ETR:BMW, FB, GM,

GOOG/GOOGL, GIS, HAR, IHRT, KRX:005930, LNKD, MCD, MON, MSD, MSFT, NFLX, NXTD, P, QCOM, S, SYT, T,

TMUS, TWTR, TWX, TYO:6460, TYO:6758, TYO:7201, TYO:7974, VLKAY, VZ, WFM, WMT, YELP

IntroductionWelcome to Blueshift Research’s and SurveyMonkey’s seventh edition of the Trends Tracker. This monthly

research survey tracks roughly 20 of the most pressing topics affecting U.S. consumers as well as business and

investment theses. We monitor trends to see how respondents’ opinions evolve and frequently update survey

questions with new issues that emerge from our research and observations.

This month’s Trends Tracker comprises 1,080 respondents who represent a general sample of the U.S. public.

SurveyMonkey utilizes Census data to balance respondents by gender and age so that the sample aligns with the

U.S. population.

Summary of Findings • A brand-new topic this month is U.S. consumers’ use of streaming music services. Pandora Media Inc.’s (P)

free service is most frequently used, followed by Google Inc.’s (GOOG/GOOGL) YouTube, iHeartMedia Inc.’s

(IHRT) iHeartRadio and Spotify’s free service. Competition between Pandora and Spotify is at an all-time

high as both services are used the most by the same demographic, 18- to 29-year-olds.

o 40.9% of respondents use Pandora’s free service for their streaming music needs; 25.4% use YouTube while 11.8% use iHeartRadio and Spotify’s free service.

o Of paid subscription services, 4.2% use Pandora One while 3.8% use Spotify Premium.

• Solar panel adoption in U.S. households largely has been stagnant in our six months of tracking the power

source. Most likely this is due to consumers not knowing that solar is now cheaper than most local utilities.

o 34.4% of consumers are likely or already have solar power in the homes in the next six months, a 0.5 percent-age-point decrease compared with six months ago.

o 3.8% already have solar panels, a 0.8 percentage-point increased compared with six months ago.

o 39% of those ages 30 to 44 were the most likely to adopt solar panels in their homes in the next six months, a shift from six months ago when consumers ages 45 to 60 were the most likely adopters.

o Respondents with household incomes of at least $150,000 now are the most likely to adopt solar panels in the next six months, jumping 6.2 percentage points compared with six months ago.

• The number of respondents likely to adopt wearable technology in the next three months rose quarter to

quarter. This may be linked to the plethora of wearables entering the market in all price ranges. Such interest

benefits not only the makers of wearable technology but also the semiconductor companies making the

devices’ chips.

o 40% are likely to adopt wearable tech in the next three months, a 5.3 percentage-point jump quarter to quarter.

o 6.6% have already adopted wearable tech, a 3 percentage-point lift quarter to quarter.

o All age groups are more likely to adopt wearable tech in the next three months compared with the previous quarter.

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Topics

1) Pandora dominates streaming music market.

A new topic this month is streaming music services, which Pandora Free dominates, followed by YouTube,

iHeartRadio, and Spotify. These services are free, but Pandora still leads in paid services over Spotify’s Premium

offering. Younger respondents use Pandora free and Spotify free and Premium the most, while those ages 30 to

44 use Pandora One premium and iHeartRadio. Pandora currently has 250 million registered users, and plans to

expand that number through cars and wearable devices. Spotify is gaining traction by growing its user base to

60 million, with roughly 15 million paying customers. For every customer that pays for Spotify’s premium service,

three more are using its free service; this lines up with our data of roughly 12% of respondents using Spotify’s free

service and 4% using its paid service. The company recently upgraded its Windows phone app. Not to be left

out of the market, Apple Inc. (AAPL) recently acquired Semetric, which creates analytics on music sales, social

networking mentions, and illegal downloads. Deezer is trying to gain traction through acquisitions and recently

acquired Cricket’s (AT&T) Muve music service. iHeartRadio, on the other hand, is trying to be in as many places as

possible; in 2015 the service will be available on Sony’s PlayStation 3 and 4, TiVo’s digital video recording devices,

DISH’s Hopper set-top box and car system manufacturer Clarion’s newest cloud-connected auto infotainment

system. iHeartRadio was part of a concept car unveiled by BlackBerry’s QNX unit.

What streaming music services do you use?

• 40.9% use Pandora free for streaming music, while 25.4% use YouTube and 11.8% use iHeartRadio and Spotify

free, respectively.

• 4.2% use Pandora One, while 3.8% use Spotify Premium.

• Younger respondents are the most likely to use Pandora’s free service, while those ages 30 to 44 are the

most likely to pay for Pandora One.

• Respondents ages 30 to 60 are the most likely to use iHeartRadio.

• Younger respondents, specifically ages 18 to 29, are the most likely to adopt Spotify free and Premium.

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2) Consumer solar adoptions slows despite panel costs coming in below local utility costs in many large U.S. cities.

The number of respondents interested in adopting solar power is slightly down from six months ago, but

still remains slightly above one-third. Respondents who have adopted solar in their households grew 0.8

percentage points compared with six months ago. The two polar ends of the household income spectrum

have become increasingly interested in solar panels. Also, respondents ages 30 to 44 now are the most likely

to adopt solar panels in their homes. The cost of solar is dropping below utility costs. “Right now, buying an

average-sized, fully financed solar PV system costs less than electricity from their local utility for 93 percent of

single-family homeowners in America’s 50 largest cities, and in most places, is a better investment than many

of the stocks that are in their 401(k),” said Jim Kennerly, project manager for the Going Solar in America report.

“Nevertheless, most people are unaware that solar is this affordable for people of all walks of life.” Government

officials also are pushing to increase the amount of alternative energy used. California Governor Jerry Brown is

calling to have 50% of the state’s energy coming from renewables in the next 15 years.

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How likely are you to adopt solar power in your home during the next six months?

• 34.4% of respondents already have solar power in the homes or are likely to adopt the power source in the

next six months, a 0.5 percentage-point decrease compared with six months ago.

• 16.8% are slightly likely to adopt solar panels in their homes in the next six months, the same as six months ago.

• 6% are very or extremely likely to adopt solar panels in their homes in the next six months, a 0.9 percent-

age-point decrease compared with six months ago.

• 3.8% already have solar panels, a 0.8 percentage-point increase compared with six months ago.

• 39% of respondents ages 30 to 44 were the most likely to adopt solar panels, a shift from six months ago

when those ages 45 to 60 were the most likely adopters.

• Respondents with household incomes of $150,000 now are the most likely to adopt solar panels in the next

six months, jumping 6.2 percentage-points compared with six months ago.

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3) More respondents are likely to adopt wearable technology, but adoption still remains minimal.

More respondents, particularly younger ones, are likely to adopt some form of wearable technology in the

next three months quarter to quarter. 2015 is shaping up to be the year of wearable technology. Las Vegas’

Consumer Electronics Show was buried in such devices. One barrier to adoption is the relatively high prices,

but Withings is offering a $150 smartwatch called the Activité Pop. One wearable tech tester believes the

sector and its devices need five developments in order to experience growth: better functionality, comfortable

devices, style, information on all the data produced and how to use it, and easy-to-use apps. The health sector

is set to be a big portion of wearable sales, and the semiconductor companies that help to make wearable

devices also are set to benefit. Still, some companies are feeling the pressure from minimal adoption. Google

temporarily shut down Google Glass, and Qualcomm Inc. (QCOM) and Pebble decreased the prices of their

smartwatches. Consumers still are a waiting the release of the Apple Watch.

How likely are you to adopt wearable technology in the next three months?

• 40% are likely to adopt wearable tech in the next three months, a 5.3 percentage-point jump quarter to quarter.

• 6.6% have already adopted wearable technology, a 3 percentage-point lift quarter to quarter.

All age groups are more likely to adopt wearable technology compared with the previous quarter.

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4) Almost one-third of respondents are likely to by an insect-based food product.

30.8% of respondents are likely to buy food with an insect-based ingredient, down slightly from the previous

month. A little more than one-half of those were only slightly like to buy such a product. Younger demographics,

specifically those between ages 18 to 29, were most open to the idea. A recent Consumer Reports sampling of

two companies’ insect products found the bars and cookies tasted normal or like coconut. A bunch of startups

are popping up and hoping to take advantage of this estimated $20 million industry. Big Cricket Farms is a

perfect example of the explosive growth: It has thousands of pounds of cricket flour backordered, and will

reach profits after being open for one year. Big Cricket Farms’ partner Tiny Farms is looking to design more

sustainable, efficient and to-scale facilities. Six other companies with products in the market are Chapul, which

sells cricket bars online; Bitty Foods, which sells cricket flour cookies and cricket flour cookie mix; Exo, which

sells cricket protein bars; Six Foods, which sells cricket flour cookies and recently received funding for Chirps,

cricket-based high-protein chips; Next Millennium Farms, which sells bug flour, organic crickets, and roasted

crickets and mealworms in various flavors; and Hopper Foods, which sells energy bars.

How likely are you to buy food with an insect-based ingredient?

• 30.8% are likely to buy such a product, a 0.6 percentage-point decrease compared with last month.

• Of those, 16% were slightly likely to buy a product with an insect-based ingredient.

• Younger respondents are more likely to buy insect-based food.

• Those making below $50,000 are the most likely to buy a product with an insect-based ingredient, but

those making above $150,000 jumped 7 percentage points compared with the previous month.

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5) EV adoption sees a bump month to month, but millennials are opting not to buy cars.

Gas-powered vehicles still dominate the roads, but the number of respondents driving such cars has decreased

slightly since December. Full-electric vehicle (EV) adoption rose slightly since the previous quarter, particularly

among 30- to 44-year-olds and respondents making above $150,000. Electric car sales are up 58% year to

year, especially Nissan Motor Co. Ltd.’s (TYO:7201) Leaf, General Motors Co.’s (GM) Chevrolet Volt and BMW

AG’s (ETR:BMW) i3. Not owning a car is a growing trend among respondents ages 18 to 29. Instead, millennials

are embracing public transit, bikes and walking. Their debt from school and unemployment may a factor.

What type of car do you own?

• 85.4% drive a gas-powered vehicle, a 1.4 percentage-point decrease compared with December.

• Respondents 60 and older and with higher incomes are most likely to adopt a hybrid vehicle.

• Those ages 30 to 44 and with household incomes above $150,000 are the most likely to have an EV, but

respondents 61 and older or making less than $25,000 also were interested in such vehicles.

• 8.6% do not own a car, an almost 1 percentage-point increase compared with last month.

• 23.6% of respondents ages 18 to 29 do not own a vehicle.

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6) Cord cutting continues as TV streaming services ramp up quality and quantity of content.

Respondents are decreasing the amount of basic pay-TV services they use in their house compared with last

month, and are leaving pay-TV services at a rate of 1% a month. Also, the number of those using pay-TV with

add-on services has risen quarter to quarter. Younger respondents are the most likely to never have carried a

pay-TV subscription and to have canceled their pay-TV services more than a month ago. Older respondents are

more likely to adopt add-on services.

Cord cutting will continue to grow in the United States as the quantity and quality of online streaming continue

to increase. Netflix Inc. (NFLX) is at the top of the pack of streaming TV services; roughly 52.7% of respon-

dents use the service, up from the previous months. Amazon.com Inc.’s (AMZN) Amazon Instant Video usage

is ahead of Hulu and Hulu Plus combined, 26.2% to 20.4%. DISH Network Corp. (DISH) is trying to address

the lack of local news and sports in streaming services with its pending release of Sling TV. Time Warner Inc.’s

(TWX) HBO Go is another pending release that should help push cord cutting forward. Big cable players are

taking notice. In a move to promote its TV Everywhere app and feature, next month Comcast Corp.’s (CMCSA)

NBC will live-stream the 11-hour Super Bowl XLIX for free to cable customers or those who obtain login infor-

mation from someone with cable.

Do you use pay-TV in your household?

• 36.5% have a basic pay-TV service in their households, a 1.6 percentage-point decrease from last month.

• 34.5% have a pay-TV service with an add-on service, a 3.3 percentage-point rise from last month.

• 1% have canceled their pay-TV in the past month, roughly the same as the month before.

• Younger consumers are more likely to have never had a pay-TV subscription or to have canceled their

pay-TV subscription more than a month ago.

• Older consumers are more likely to have add-on service in addition to their pay-TV subscription.

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7) Marijuana legalization support grows as states and cities take notice.

Respondents’ desire for marijuana legalization continues to grow in all age groups and in households with

higher incomes. Support can be seen across the country, including in Arizona, where consumers are protesting

marijuana laws. Rep. Mark Cardenas is trying to push a legalization bill into the 2016 Arizona ballot. New York

recently filed a bill to pass the legalization, and a recent poll commissioned by NORML showed 50% support

of legalization in Michigan. A senator of Pennsylvania and a bill introduced in Indiana are trying to enact laws

to make marijuana legal for medical purposes. Legalized marijuana could generate between $20 million to $75

million each year as well as job opportunities for such states. The entire legalized marijuana industry revenue is

set to grow to $47 billion by 2016.

What should the law be regarding marijuana?

• 45.9% think marijuana should be completely legal, a 3.4 percentage-point rise compared with six

months ago.

• Younger demographics continue to lead other age groups in wanting marijuana to be legalized, and

respondents in other age groups except those ages 45 to 60 also are becoming more supportive

of legalization.

• For the first time, respondents with household incomes of $150,000 are the income bracket most in

support of legalization, up 12.6 percentage points to 54.3% quarter to quarter.

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8) Specialty store growth continues as big-box retailers suffer.

Respondents still do most of their shopping at local grocery store chains, while some are moving to specialty

grocery stores and away from big-box retailers. Whole Foods Market Inc. (WFM) has benefited from the

trend and is rapidly expanding its presence in Houston, Pompano Beach, FL, and Chicago. To help shed its

high-priced label, Whole Foods is also expanding into “food deserts.” This move comes with lower-quality

meat cuts, but helps create new jobs in economically depressed areas. Meanwhile, Walmart Stores Inc. (WMT)

will change its focus its Neighborhood Market store format; it plans to open 180 to 200 such stores this year.

Where do you shop for the majority of your groceries?

• 61.3% do most grocery shopping at local grocery store chains, a 0.5 percentage-point dip quarter to quarter.

• 21.6% do most grocery shopping at big-box retailers, a 3.5 percentage-point drop quarter to quarter.

• 14.1% do most grocery shopping at specialty retailers, a 1.2 percentage-point rise quarter to quarter.

• Younger respondents and those making below $25,000 and above $150,000 a year are the most likely to

shop at specialty grocery stores.

• Older respondents and those making more than $50,000 are most likely to shop at local grocery store

chains. Those making less than $25,000 showed a significant drop in shopping at local chains quarter to

quarter.

• Those ages 30 to 44 or with incomes below $50,000 are the most likely to shop at big-box retailers

for groceries.

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9) The anti-GMO movement continues to grow and is gaining the support of farmers and companies.

Opposition to buying GMO foods has grown, rising 3.9 percentage points compared with six months ago. Still,

the number of respondents opposing the use of genetically modified foods has fallen over the same period.

Rising opposition stems from respondents at least 30 years old and with household incomes above $25,000.

Nielsen results from a recent survey showed 32% of U.S. consumers believe GMO-free products are a very

important attribute in their food, and global demand for GMO-free products continues to expand. 80.9% of our

respondents want GMO products to be labeled. The amount of food labeled as GMO-free is on the rise, such

as General Mills Inc.’s (GIS) Cheerios. One cookie storeowner in Vermont is not worried about the rising cost of

organic, non-GMO ingredients as the state is a year away from initiating the labeling of GMO products, which

likely have a minimal pricing effect on consumers. Farmers from across the country, specifically Kansas, also

are pushing back and are suing Syngenta AG (SYT) for contaminating corn crops with genetically modified

seeds and affecting corn prices. Also, GMO seeds have shown a lack of effectiveness in resisting pests,

according to a study done by the University of Arizona.

What are your views on GMO foods?

• 35.4% are opposed to and do not buy GMO foods, a 3.9 percentage-point increase compared with six

months ago.

• 10.8% are in favor of and buy genetically modified foods, a 14.6 percentage-point decrease.

• Opposition to GMO foods is growing among consumers 30 years and older.

• Those with household incomes above $25,000 are increasingly more opposed to GMO foods, and are not

buying those products. Opposition increased the most from six months ago among those in the highest

income bracket.

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Should GMO foods be labeled?

• 80.9% think GMO foods should be labeled, a 1.1 percentage-point decrease compared with six months ago.

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10) Digital wallet use decreased during the past quarter but has grown among those ages 18 to 29.

Use of digital/mobile wallets has declined compared with the previous quarter, most likely from older

respondents abandoning such services. Still, daily use of digital wallets is up slightly, as is the number of new

users. Respondents ages 18 to 29 are increasing their use of digital wallets. Some digital wallets are not seeing

the success needed to be sustainable. Amazon Wallet is shutting down operations after only being in beta for

six months. However, analysts predict explosive growth for mobile payments in 2015 from $50 billion, to $142

billion by 2019. NXT-ID Inc. (NXTD) is set to grow in 2015 as its Wocket smartwallet enters the market. Google

is trying to expand its presence in the space and may buy Softcard. Apple Inc.’s (AAPL) Apple Pay continues

to gain backing from banks, but TipEasy is taking advantage of Apple Pay’s lack of countrywide acceptance by

allowing use of Apple Pay through its new app.

Have you used a digital or mobile wallet in last month?

• 35.4% have used a digital or mobile wallet in the last month, a 4.2 percentage-point decrease compared with the previous quarter.

• 43.5% of respondents ages 18 and 29 have used a digital or mobile wallet in the last month, leading all other age groups and rising 2.7 percentage-points compared with the previous quarter. Respondents 45 and older are decreasing their use of digital wallets and are the least likely to adopt a mobile or digital wallet.

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11) Console gaming use jumps after the holiday season.

The gap between computer gaming and other forms of gaming is narrowing, as computer, console and

smartphone gaming were all separated by roughly 1%. This could be linked to the holiday season, as the latest

gaming console sales rose 17% in November and December. In addition to its sales of Sony Corp.’s (TYO:6758)

PlayStation 4 and Microsoft Corp.’s (MSFT) Xbox One, GameStop Corp. (GME) has benefitted from an increase

of games sales for those consoles. Even Nintendo Co. Ltd.’s (TYO:7974) Wii U had its best-selling month in

December. Microsoft also is turning the gaming world on its head with Windows 10, which allows both PC and

console gamers to occupy the same space and to communicate. Xiaomi may launch a video game console but

first is starting with a Bluetooth game controller for its Mi phones and tablets, adding another level to entice

smartphone gamers in China. Smartphone gaming is set to grow. Sega Sammy Holdings Inc. (TYO:6460) is

moving its flagship Sonic series to smartphones, with Sonic Runners.

How do you play the majority of your video games?

• 15% play video games through a computer, 14.9% use a console, and 14.1% a smartphone. Computer use

decreased 0.7 percentage points quarter to quarter, while console and smartphone use rose 2.2 and 0.3

percentage points, respectively.

• Console use is led by those ages 18 to 44 and with household incomes of $25,000 to $49,999.

• Younger demographics and all income levels use smartphones to play the majority of their video games.

• Console use still is being led by older demographics, but tablet use decreased in all age groups quarter

to quarter.

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12) iPhone domination continues.

Apple continues to dominate the smartphone market with its iPhone 6 and 6 Plus, up 8.5 percentage points

compared with six months ago. Larger screens are helping the iPhone 6 and 6 Plus commandeer high-end

sales at the four major U.S. carriers. Our survey falls right in line with the rising iPhone sales in the high-end

market. iPhone sales are expected to eclipse the 2013 holiday season by 18 million, and will grow as Apple

increases the rate of updates to its software. Meanwhile, iPhone sales are soaring in Asian markets, including

Samsung Electronics Co. Ltd.’s (KRX:005930) home base of Japan. The Galaxy Note4 is keeping Samsung

afloat. Samsung recently released its Tizen phone called the Z1 but only in India. It will not release it in the

United States this year based on the market’s maturity and the phone not meeting U.S. standards.

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Which company made the smartphone you currently own?

• 42% own an iPhone, an 8.5 percentage-point increase compared with six months ago.

• 19.3% own a smartphone made by Samsung, a 2.4 percentage-point decrease compared with six months ago.

• 16.3% do not own a smartphone, a 6.7 percentage-point decrease compared with six months ago.

• Compared with six months ago, younger respondents are more likely to own a smartphone and those 31 and

older are more likely to have an iPhone.

• All income levels increased their ownership of iPhones in the market, still lead by households with

higher incomes.

• Those making $25,000 to $49,999 were the most likely to have a Samsung smartphone; Samsung

ownership has fallen in all other age groups compared with six months ago.

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13) More respondents trust Yelp, but Google still leads in consumer reviews.

Respondents primarily trust Google for online consumer reviews of merchants, but we saw a 3.7 percent-

age-point drop in mentions of Google from the previous month. The number of respondents who trust

Yelp Inc. (YELP) rose 3.3 percentage points compared with last month, but responses for Angie’s List Inc.

(ANGI) decreased 0.7 percentage points. Younger respondents use both Google and Yelp, while their older

counterparts use Angie’s List and Facebook. A new Yale study shows that less than 10% of reviews on sites are

fake. It also found that consumer habits are affected by other reviews in general. Next month we will add the

response options of “I do not trust consumer reviews” and Urbanspoon. Zomato recently acquired Urbanspoon

and is in the middle of raising $80 million to expand into the United States. Meanwhile, Yelp has teamed up

with Socrata, a government data tech company, to provide restaurant ratings and inspection information.

Which site do you trust most for consumer reviews on merchants?

• 28% trust Google reviews on merchants, a 3.7 percentage-point drop compared with the previous month.

• 24.9% trust Yelp reviews, a 3.3 percentage-point increase from the previous month.

• Yelp is trusted by those ages 18 to 29 and above 60. Older respondents trust Angie’s List while their younger

counterparts rely on Google. Those ages 45 to 60 are the only ones to have more faith in Facebook reviews.

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14) Healthy living habits continue and are costly to McDonald’s.

Respondents still are improving their living habits compared with six months ago but at a slightly slower rate.

McDonald’s Corp. (MCD) continues to be plagued by decreasing revenue as fast-casual, healthier restaurants

like Doctor’s Associates Inc.’s Subway and Chipotle Mexican Grill Inc. (CMG) gain momentum. McDonald’s

is trying to correct its image through a massive ad campaign focused on “love,” while Chipotle continues to

focus on organic, healthy ingredients. When a pork supplier was not living up to Chipotle’s “reasonably raised”

standard, the company pulled carnitas from locations around the globe. McDonald’s reportedly also is pulling

some menu items, specifically McCafé and Happy Meal choices. Its franchisees have seen same-store sales

growth shrink.

Compared with six months ago, how have your living habits (diet, exercise, sleep, etc.) changed?

• 38.9% are improving their living habits, an 11 percentage-point decrease compared with six months ago.

• 17.1% are seeing a decline in their living habits, a 3.7 percentage-point increase compared with six months ago.

• Two times the number of respondents are improving their living habits as those whose habits have worsened.

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15) Tobacco use dropping slightly.

We noted a slight drop in respondents smoking any form of tobacco, but those who still do smoke primarily do

so with cigarettes. The number of respondents using electronic cigarettes, or e-cigs, decreased slightly quarter

to quarter. Although tobacco use has been cut in half from 51 years ago, states are using less funding for the

prevention of tobacco use than what is recommended by the Centers for Disease Control and Prevention.

Still, some states are looking to change regulations to inhibit the use of tobacco products and are starting to

crack down on e-cigs as well. Montana is the latest state to propose a bill to eliminate the sales of e-cigs to

consumers under the age of 18; 40 other states have already done so. However, younger generations are not

the only ones using e-cigs; some adults have turned to the product to end lifelong addictions to cigarettes.

Such e-cig demand could hurt sales for cigarette manufacturers.

How do you smoke most of your tobacco?

• 84.3% do not smoke tobacco, a 1.7 percentage-point increase quarter to quarter. Respondents ages 30 to 44

are the most likely to smoke tobacco, a slight shift from those ages 18 to 29 found in the previous quarter.

• 7.5% smoke cigarettes, a 2.5 percentage-point drop quarter to quarter.

• 1.8% smoke e-cigs, a 0.5 percentage-point decrease compared with the previous quarter.

• Those ages 30 to 44 and making $25,000 to $49,999 are the most likely to use e-cigs.

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16) Embedded infotainment systems stall as traditional radio dominates in-car entertainment.

Traditional radio continues to dominate in-car entertainment. Smartphone and embedded system use fell

slightly quarter to quarter, while satellite radio consumption was relatively stagnant. Younger consumers most

often use smartphones for in-car entertainment, while older respondents turn to satellite radio. Those ages 30

to 60 are the most frequent users of embedded systems. Although overall use of such systems is low, many car

companies are installing them in new models. Volkswagen AG (VLKAY) cars soon will be available with Apple’s

CarPlay or Google’s Android Auto. Verizon Communications Inc. (VZ) also is entering the market via the car

aftermarket by offering Verizon Vehicle. Two players benefiting from this trend BlackBerry Ltd.’s (BBRY) QNX

Software Systems and Harman International Industries Inc. (HAR).

How do you consume most of your entertainment in your car?

• 56.3% use a traditional radio, a 2.4 percentage point increase quarter to quarter.

• Embedded auto infotainment and smartphone use both decreased by roughly 1 percentage point.

• Auto infotainment systems are used mostly by those ages 30 and 60, the same as in the previous quarter.

• Those younger than 45 were the top in-car users of smartphones.

• Satellite use continues to be used by older consumers with higher household incomes, the same as last quarter.

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17) Verizon continues to dominate the wireless carrier market as Google enters the field.

Verizon continue to be the most embraced wireless carrier, followed by AT&T Corp. (T). To stay competitive,

Verizon recently doubled the amount of data in its entry prepaid plans and now offers unlimited voice and

texting. T-Mobile US Inc. (TMUS) is cutting its unlimited MetroPCS plan from $60 to $50 per month. AT&T’s

Cricket landed an exclusive deal with Deezer to offer a music service for $6 a month. Google is the newest

entry into the wireless carrier market; it struck two separate deals with Sprint and T-Mobile to become a virtual

wireless carrier.

Who is your current wireless carrier?

• 38.3% use Verizon as their wireless carrier, a 0.6 percentage-point increase quarter to quarter.

• 28.9% use AT&T as their wireless carrier, a 2.6 percentage-point jump quarter to quarter.

• 8.6% use T-Mobile as their wireless carrier, a 1.2 percentage-point dip quarter to quarter.

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18) Expanded features allow Facebook to stay ahead of the pack in social media usage.

Facebook remains the dominant force in the social media world, but is showing a slight decline in the number

of respondents primarily using its site in the past six months. The number of respondents using Twitter Inc.

(TWTR) has grown slightly. Of those 19 and older, 57.3% use Facebook most often, almost identical to the 58%

cited in a recent Pew Research Center poll. Pew also noted that 56% of Internet users above the age of 65

use Facebook, slightly higher than the 53.5% we noted in our survey. Facebook is making its platform more

valuable to consumers by cleaning up its feeds and allowing users to identify fake news reports. It also will

begin sending regional Amber Alerts to news feeds. Facebook’s features allow the site to increase engagement

and use over multiple platforms, while other social media sites do not have as many ways to engage possible

consumers. Increased use of Twitter may be due to 24 million active accounts that are run by apps or pieces

of software. Twitter acquired ZipDial to expand into emerging regions that may be without Internet services.

Our survey did not cover Tinder since its engagement is limited to finding a date, but the company is rapidly

growing and made its first acquisition of Tappy, a similar app to Tinder’s “moments” feature.

Which social media platform do you use the most?

• 57.3% primarily use Facebook for social media, a 0.8 percentage-point decrease compared with six

months ago.

• 4.6% primarily use Twitter, a 1.4 percentage-point increase compared with six months ago.

• Facebook’s Instagram still is used primarily by those 18 to 29 years old. Twitter is used most frequently

by those 30 to 44, a slightly older demographic compared with six months ago. Facebook is used by

younger demographics, a shift from previous reports, while Google+ is attracting older consumers.

LinkedIn Corp. (LNKD) is used the most by those 45 to 60.

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19) 11 Main? What’s that?

Alibaba Group Holding Ltd.’s (BABA) 11 Main is gaining very minimal traction in the United States; 97.1% of our

respondents still had not heard of the consumer site. Still, one analyst sees a way to improve or replace the

service: by buying eBay Inc. (EBAY) after it splits from PayPal. Also, Alibaba is creating a connection from the

United States to the Chinese market for companies like Costco Wholesale Corp. (COST), which would provide

11 Main access to numerous brands. Meanwhile, 11 Main is starting to advertise various items through Facebook.

Have you heard of 11main.com?

• 97.1% of respondents had not heard of 11 Main, a 1.3 percentage-point decrease compared with six months ago.

20) Unvaccinated children spreading measles throughout California.

A minimal number of respondents believe children should not be vaccinated, a slight decrease quarter to

quarter. Respondents ages 18 to 29 were the most likely to be anti-vaccination, but we noted a 0.7 percent-

age-point decline even in this age group quarter to quarter. A recent study done in California revealed that

children who go unvaccinated are more likely to come from the same county, placing them at a higher risk

for infection. Such an event occurred at Orange County’s Disneyland, as the measles were spread from the

location to dozens of students in the area.

Should children be vaccinated?

• 4.3% believe children should not be vaccinated, a 0.8 percentage-point decrease quarter to quarter.

• Younger respondents are the most likely to believe children should not be vaccinated.

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21) Respondents believe the United States’ economic prospects are improving.

More respondents than in October believe the country’s economic prospects are improving. Almost half of

those said neither major political party is responsible for the improvement. A Gallup poll ending on Jan. 18 also

illustrated rising confidence. The country’s economy is expected to grow 3.6% through 2015 on the back of

private domestic demand and lower oil prices.

Do you think the United States’ economic prospects are improving or declining, and which political party

is responsible?

• 56.7% believe economic prospects are improving, a 6.3 percentage-point increase from the previous quarter.

• 43% do not hold either major political party responsible for the United States’ economic prospects, a 1.8

percentage-point decrease from the previous quarter.

• Younger consumers are more likely to hold neither party responsible.

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22) Top apps: Trivia Crack, Candy Crush Soda Saga, Snapchat and Google apps

Which new apps/mobile games are you now using?

• Social media apps (Snapchat, Pinterest and Tinder)

• Google apps (Docs and Translate)

• Music streaming (Pandora and Spotify)

• Trivia Crack

• Boom Beach

• Google’s Nest

• SimCity

• Candy Crush Soda Saga

• RetailMeNot

• TwoDots

• Evil Apples

• Target Cartwheel

• Scrabble

• Leafly

• Uber

• MyFitnessPal

• Waze

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23) Top Trends: Wearable tech, lower gas prices, selfie sticks, streaming, and a sustainable food movement

What is the most interesting new trend you have seen in the last month?

• Wearable technology: health monitoring and fitness tracking, such as Fitbit

• Lower gas prices

• Selfie sticks

• Streaming music and TV

• Insect-based foods

• Police using excessive force, and protests against the police

• Trivia Crack

• Butt selfies

• Sustainable food movement

• Midi rings

• Smarthome products

• Digital/mobile wallet use

• Social activism

• Solar panels

• Drones

• No tipping at restaurants, and raising employee pay and benefits instead

The Author(s) of this research report certify that all of the views expressed in the report accurately reflect their

personal views about any and all of the subject securities and that no part of the Author(s) compensation was,

is or will be, directly or indirectly, related to the specific recommendations or views in this report. The Author

does not own securities in any of the aforementioned companies.

OTA Financial Group LP has a membership interest in Blueshift Research LLC. OTA LLC, an SEC registered

broker dealer subsidiary of OTA Financial Group LP, has both market making and proprietary trading operations

on several exchanges and alternative trading systems. The affiliated companies of the OTA Financial Group LP,

including OTA LLC, its principals, employees or clients may have an interest in the securities discussed herein, in

securities of other issuers in other industries, may provide bids and offers of the subject companies and may act

as principal in connection with such transactions. Craig Gordon, the founder of Blueshift, has an investment in

OTA Financial Group LP.

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