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Facebook Inc (NASDAQ:FB)-owned Instagram is more popular than Twitter Inc (NYSE:TWTR) among U.S. smartphone users. According to a new study by eMarketer, Instagram has 34.6 million monthly active users in the U.S. who use the platform on mobile. In contrast, only 30.8 million Americans use the microblogging service on their smartphones. By the end of this year, estimates eMarketer, this number for Twitter will grow to 37.3 million. Meanwhile, Instagram will have 40.5 million mobile users.

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Instagram now has more than 200 million users worldwide

It comes at a crucial time for Instagram. The Facebook Inc (NASDAQ:FB)-owned photo sharing app has started selling ads. It recently signed a $100 million advertising deal with Omnicom Group Inc. (NYSE:OMC). Facebook CEO Mark Zuckerberg said earlier this week that Instagram now has more than 200 million active users worldwide, who share more than 60 million photos every day. A total of 20 billion photos have been shared since the platform was first launched in 2010.

Facebook Inc (NASDAQ:FB) acquired it in April 2012 for $1 billion. Since its acquisition by the social networking giant, Instagram has seen a six-fold increase in its user base. And more than 50 million of them joined in the last six months. Twitter Inc (NYSE:TWTR) and Instagram were both developed for mobile users first. But Twitter is more popular on the desktop.

Instagram is a ‘beautiful branding platform’

Instagram is wildly popular among the younger generation, especially people between 18-34. It has helped Facebook Inc (NASDAQ:FB) keep young people tied to its platform even as they are getting tired of the main social platform. Instagram is now building its business with brand marketers. An eMarketer analyst Deborah Aho-Williamson said that brand marketers see it as a beautiful branding platform.

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However, not all is rosy with Instagram. The study found that its smartphone penetration is slowing. The smartphone penetration rate is expected to decline to 17% this year from 23.9% in 2013. Though the service will continue to grow, it is estimated to have only about 56 million smartphone users in the United States by 2018.

Twitter Inc (NYSE:TWTR) shares jumped 3.59% to $46.02 at 1:36 PM EDT.