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3 reasons the promise of LBS may be starting to be fulfilled

If you’ve hung around the wireless industry for a while, there have been a few sectors where expectations have been sky high, yet the uptake utterly disappointing. One of these sectors is Location Based Services (LBS). Even markets that have been highly advanced in mobile, such as Scandinavia, have had very few successful services. In Norway, an early LBS called “Buddy” which allowed you to receive alerts when a friend was nearby by Netcom (incumbent mobile operator) was killed by the government. They cited privacy concerns despite the service being opt-in. This was back in 2001, and since then, there arguably have been extremely few success cases outside of an uptake in use of navigation services. I would not call a few million users on Foursquare or Gowalla a success either, as clearly users are in the early adopter/tech geek segment (this writer included) – and it is not yet a mass market service.


1. Google combining Places with reviews and Ads
First, Google added a recommendation capability to Google Places (the local listing of businesses on google), called Hotpot. This means that when you are out and about, you can easily read reviews for nearby places, and if any of your friends have ranked the place, they will come up first. Sounds like just another Yelp like service? Well, it is – but what makes this powerful is obviously Google’s enormous traffic, the likelihood of Google being the first stop for information for anyone mobile, and the widespread use of Google Ads which businesses are very comfortable with.
2. Easy access to context (location) specific information

Google does not stop there, and have added an ability to find out whether a product is in stock at shops near you. Although still in the experimental stage, combined with the above, it is all geared to retailing based on location.

3. Facebook making location a key variable in social
Lastly, you cannot ignore the release of Facebook places. While Foursquare may be for the early adopting tech geeks, Facebook’s reach means adding location to your posts or pictures could be come the standard. The goal of checking in will not be to become the mayor, but simply because “where are you doing it” will become as relevant as “what are you up to”.
What does this mean for service providers and media companies?
 Early reports suggest that LBS will indeed take off (although I am always sceptical to such studies, especially when sponsored by someone who will benefit by the results. Even though JiWire predicts 90% of their tech savvy users will use mobile location based services this holiday season, if you are a retailer or media company, fear not, as it will take some time before this type of use of LBS will indeed be mass market, so there will likely be time to adapt – and the big guys like Facebook and Google are building tools to make it easy for you to take advantage of it.
However, the opportunity is there for innovators to start using location as an advantage. For instance, if you are providing typical location based information such as travel information and reviews, restaurant listings etc. you need to immediately start thinking about your Google/Facebook integration strategy. Few doubt the importance of Facebook connect in terms of viral and mainstream adoption of your services, and Google’s revenue numbers will tell you the power context relevant advertising. If your product/service is based on context relevance, and especially if this product/service is a content type of service, LBS is right here, right now.


Posted in The Business of Mobile.

One Response

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  1. JT says

    As a follow up to this article, please read Foursquare’s partnership with Pepsi ( The linking of loyalty cards with location and instant redemption and rewards is quite brilliant, and we will see many more examples of this. What better way to link travel guides, to frequent flyer/hotel points and activities or purchases while you are on holiday? The possibilities are endless…