Thanks to the FCC's E911 mandate, requiring all U.S. wireless carriers to be able to locate their subscribers in an emergency, an opportunity for additional revenue has appeared with location-based services (LBS). While LBS is not new, carriers had been unwilling to invest in the technology to enable them since uptake was uncertain. Operators now are required to have location-finding abilities, so why not add on applications that make use of it?
LBS, which provide functionality and information based on a user's physical location, has enjoyed widespread uptake in places like Japan, where "friend-finder" services based on mobile presence is a national pastime for the country's teenagers. Tokyo hipsters rely on their phones to alert them when someone with matching interests is within a certain radius. But in the United States, adoption has been slower. Bob Ewald, senior director of core data services for Nextel Communications Inc., says that's all about to change.
"Up until now, LBS has been limited mostly to applications for field service organizations, where information on employee location is used for routing and service scheduling," says Ewald. "But the next year or so will see more carriers offering these and more consumer applications becoming available."
Nextel is one of the first U.S. carriers to package and market LBS. Most carriers enable E911 services through triangulation; the system gathers location data, sends it back to the network, then waits for the network to calculate the user's position. The process results in a few seconds of delay to account for the relaying of information to and from the network.
Based on assisted GPS technology, Nextel LBS are delivered on a proprietary platform that uses the handset for location detection and then makes that information available to applications. That means the services are virtually real-time, and that has allowed the carrier to develop some useful applications. Nextel has rolled out audio turn-by-turn directions for consumers, where the driver types or speaks the destination into the handset. The phone then "reads" the directions to the driver based on where the driver is. The system recalculates the route instantly in the event of a wrong turn.
"These abilities let people grow in terms of how they see their mobile device," says Ewald. "Eventually this information will be integrated into multiple applications, leading to device and service convergence." For instance, Ewald predicts the next wave will be find-me services for consumers and businesses, tracking applications such as automatic clock-in for workers when they arrive at the office, or activation of certain consumer accounts based on location.
The potential for spam-like abuse and privacy issues is apparent with such capabilities, but like traditional instant messaging, Nextel users have control of their privacy settings, so they can make themselves invisible to LBS if they choose.
Autodesk Inc.'s LBS solution platform for mobile operators, LocationLogic 6, offers privacy management controls to enable location-related privacy preferences on a per-subscriber, per client-application basis. A subscriber's privacy preferences are maintained in his or her privacy profile. LocationLogic 6 also offers J2ME and BREW support for handset extensions that enable rapid deployment of privacy-enhanced mobile applications and network-based applications.
With platforms like LocationLogic 6 available to operators, carriers can create new services with minimal research and development. The platform's out-of-the-box capabilities include advanced mapping, routing and spatial searching functions as well as location-based triggers and alerts that enable mobile operators to deploy the next-generation location-enabled text alerting services to a mass market. LocationLogic 6 also provides application developers with access to open standards-based tools and building blocks for creating new LBS services.
With the technical pieces in place, the scene is set for more widespread application rollouts than the United States has seen so far. An issue remains in monetizing the services, however. "Carriers are moving carefully with LBS," says Boris Feldman, CEO of Crisp Wireless Inc., a mobile applications developer. "There are plenty of applications that could be developed, but the issue is how do you make money on it?"
Nextel's services, which also include location-enabled directory assistance, are offered on a subscription basis: One for $10 per month, or two for $15. There are other options for rating, such as pay-per-use or even offering the service for free and paying for it with advertising revenue, although neither has been rolled out thus far. "No one has nailed a really good business model," says Feldman. "The majority so far [has] been subscription-based, but for some services that may not make sense."
For instance, another LBS frontier is reference services, where mobile devices alert users when they are near preferred vendors, such as coffee shops or bookstores. The subscriber could manage preferences via a portal, and have the information pushed to them or simply available on-demand. Crisp Wireless is working with America Online Inc. to develop mobile versions of the Moviefone and AOL CityGuide services.
"The value in these services is derived by two parties," says Feldman. "The individual using them, and the establishment the user is looking for. Perhaps there is some way to track this and capture a fee from the restaurant, for instance, for each referral."
Whether in the form of mapping, find-me or referral services, LBS is certain to grow in use and availability as business models and applications evolve. "A rising tide lifts all boats," says Ewald. "We will see more carriers go live with applications and more people are exposed to these capabilities."
