Location-Based Services To Hit $600 Million By 2008

By DAVID SIMS
TMCnet CRM Alert Columnist
Location-based services have been "increasingly on the radar screen for a wide variety of carriers," according to a recent study by Frost & Sullivan, which has found that LBS industry revenue totaled just $91.2 million in 2004, but is projected to hit $600 million by 2008.



"The variety and breadth of possible applications and services in LBS, from pure content and advertising, to emergency 911, navigational aids, social networking, and tracking services highlight its adaptability," explains Frost & Sullivan Industry Research Manager Brent Iadarola.
Iadarola, who never has to spell his name over the phone, said that his research shows while LBS isn't seen as the next killer app, it's considered a "killer- enabler" to existing services. Unfortunately Iadarola doesn't unpack this interesting concept.
Those of you who don't drive 1963 Dodge Darts might know LBS through such vendors as Navteq, which provides technology for digital maps for vehicle navigation providing graphic, text, and voice-prompted address- to-address, turn-by-turn directions; automatic re-routing; detailed street maps including important road network information such as one-way streets, turn restrictions, and speed categories; and convenient points of interest such as local ATMs, gas stations, parking and restaurants.
Or you might use LBS in Zingy's "Locate Me" feature on MovieGoer, the popular mobile movie guide service on Sprint. Instead of having to manually key in a zip code or address, mobile users' exact locations are determined using cell sector technology. Sprint customers simply opt-in to select the MovieGoer "Locate Me" feature and the service automatically identifies their locations to provide the nearest theaters, movie times and information.
Good LBS systems are network agnostic, and can be used across disparate wireless networks.
Middleware platforms using advancements in location determination technologies and the proliferation of assisted global positioning system handsets comprise the essential ingredients for a compelling, commercial LBS suite moving into place, F&S thinks.
Given its "high overall performance and widespread location coverage even in areas of low-cell density," Iadarola says A-GPS is likely to emerge as the long-term technology of choice for operators in North America. This is important, since as he says, carriers' decision whether to spread capital expenditures over a greater period of time and provide incremental services to customers will affect their future.
By delaying services, the carriers may be able to save costs on intermediate infrastructure; however, they risk losing customers to competitors with first mover advantages:
"In contrast to fixed Internet, users in the mobile environment are demanding personalized, localized, and timely access to content and services," explains Iadarola. "LBS with user-friendly application categories such as mobile resource management, entertainment, information services, and security services are likely to be successful commercially."
The aggressive marketing of commercial LBS, growing traction of LBS offerings, as well as sophisticated and integrated LBS are some of the main factors that are likely to heighten the growth and revenue potential of these services in the future.
David Sims is contributing editor for TMCnet. For more articles please visit David Sims' columnist page.