2009: The Year of LBS (Location-Based Services)
Where's the nearest Starbucks? Where did my children go today after school? How do I get to that new Thai restaurant downtown? What are my friends saying about this new club? If you've ever asked yourself any of these questions or something similar, you were probably able to get the answers you needed just by picking up your mobile phone.
Thanks to the higher availability of GPS-enabled phones among other factors, the LBS (location-based services) market is about to boom big time. In fact, it already is. According to research firm Gartner, the market will more than double this year.
LBS in 2009: Growing, Growing
Despite a 4% decrease in mobile device sales, Gartner forecasts the LBS market to grow from 41.0 million in 2008 to 95.7 million in 2009. Revenue, too, will increase from $998.3 million in 2008 to $2.2 billion in 2009.
But it's not just GPS technology alone that has led to this sort of rapid growth. Other factors playing a role so far have included "improved price/performance of the enabling technologies and compelling location applications," says Annette Zimmermann, senior research analyst at Gartner. In other words, smartphones got cheaper and there are tons of fun apps to run on them.
As someone who totes her iPhone everywhere, this author has to agree. There are currently half-a-dozen or so LBS apps on my device including everything from mapping applications to friend finders to apps that tell me what's playing at my local cinema. I can even read local news stories courtesy of the location aware app Radar (iTunes link).
Beyond 2009
Moving further into 2009 and beyond, it won't just be iPhone addicts (like myself) who get to enjoy all that LBS technology has to offer. Other smartphone platforms will also become major players in the LBS game. For example, we're expecting 18 more Android-powered phones by year's end, Microsoft's MyPhone has just entered into beta, Blackberry's App World is only 3 months old, but has already doubled the number of apps, and Nokia's Ovi Store may have its issues, but is still a major player worldwide. Zimmermann notes that this increase in the number of application stores such as these will play an important role in growing the LBS market over the next year and beyond.
Still, as prevalent as LBS technology is today, it's still in its infancy. Over the next 12 to 18 months, Gartner predicts we'll see even more compelling applications including mobile location-based digital coupons and points-of-interest search services. And of course, we're still waiting to subscribe to our local paper via our mobile (or even pay for a downloadable app!)
However, the popularity of such applications is still dependent on region. For example, here in North America, navigation and family-safety solutions are the most popular. In Western Europe, navigation is the most used, followed by local search and friend finders, but there's no significant uptake in safety applications. These sorts of regional preferences will lead to a dynamic LBS market worldwide.
We're looking forward to watching this boom as it occurs, and are wondering what will be the next big thing in LBS apps. It's still surprising to us that Facebook hasn't integrated LBS into their mobile apps yet, leaving that to smaller players like Brightkite, Loopt, Foursquare, and others. Is that a niche that will finally take off this year? We're not sure - so far, it seems slow going - but if the market is about to double, then who knows? We may see new applications that we couldn't have even imagined emerge! It's just a matter of time.
What sorts of LBS apps are you anticipating or craving?
Image credit: flickr user chokola
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I think gps needs to be a little more stable in the phones and allot easier to program against before we start to see it proliferate. I think your totally right though.
I want to note that fawning over the iPhone you're toting is not something I expect to read on RWW. It comes across as unprofessional.
since about 10 years there is at least one person claiming that THIS year will be the year of LBS. we shall see...
I can't wait for Google Latitude to come to the iPhone.
It's being saying 'coming soon' for way too long.
This market has been predicted for at least 10 years...very few have implemented something that is actually user friendly, local and useful. Who is going to go around and sign up all the pizzerias etc. who will make money from it..waiting for a user friendly and relevant application
Hey Sarah -
Nice overview of LBS. It's a good snapshot of where the industry is at the moment. As several other commenters have noted, everyone keeps saying we're about to hit "critical mass," but has that really happened yet. Yes the iPhone/Android/Blackberry devices with GPS is a good start, but I think we're also going to have to reach a critical mass of users for others to decide it's worthwhile. Facebook could be a huge plus if they do integrate as you suggest.
We write quite a bit about LBS over at our trends blog if anyone wants further info:
http://www.mobilebehavior.com/2008/10/09/location-based-apps-navigate-real-life/
http://www.mobilebehavior.com/2009/02/06/hyperlinking-people-with-aka-aki/
How come LBS market Revenue for Japan so high?
Waiting for an LBS application which is widely adopted..
I believe that the global positioning system needs a little more stability in the distribution plan for cell phones and easy to see that its proliferation. I think you are absolutely correct.
I'm completely stumped trying to think of an example of a "Family-Safety Solution" that involves mobile data services and LBS. Are you referring to "where-are-my-kids-right-now" tracking applications? If not, then what. If so, then what else?
Even though Gartner's forecast is bit optimistic, but surely the LBS market is growing faster as the GPS is becoming a standard feature on Smartphones and high end feature phones. In addition, the availability of location APIs from Google, Yahoo and hybrid location technologies from the companies such as Skyhook Wireless bringing more tools to develop the LBS applications. Developers no longer depending on the mobile operators for the location APIs. The easy access to location APIs and the ever increasing application stores helping the proliferation of LBS applications. The new HTML 5 specifications that allow the access to the underlying location information from the web page will certainly drive the use of the location on the mobile web.
I found this general model, developed at the Radboud University of Nijmegen, the Netherlands. The site says that it will be fully completed at 31 august, but I think it can be a good tool for people who are working with LBS:
http://www.positioningtechniques.eu
LBS applications have garnered the most hype since the beginning, and yet, critical mass eludes them.
I believe user acceptance, owing primarily due to privacy and security concerns, is the biggest challenge it needs to overcome. LBS apps face distrust by users owing to the loss of personal freedom and control over the technology e.g. intrusive advertising, commercial pressure, loss of autonomy, etc.
http://sachendra.wordpress.com/2009/07/26/user-acceptance-is-the-biggest-challenge-for-location-based-services-lbs/
We believe it might indeed be the LBS year, and if you are a Developer or an Entrepreneur planning to include LBS into your innovative App or Service, come and join the Orange APIs Developer Community to find out how at : http://orangeinstantapis.bluenove.com/
Best
Martin
Tweeted: @bluenove 2009: The Year of LBS (Location-Based Services) /ReadWriteWeb : http://bit.ly/Odeo8
Well you can check out the En1gmaEngine..... would be interested in this forums comments on the aforementioned