FEATURE: LBS helps you find your way

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LBS helps you find your way  

By David Gill 

A decade ago, when I was on a road trip or a business trip to a new city, I would stop at a 7-Eleven store and buy a local map. This had two immediate benefits: 1) 7-Eleven sells ice cream sandwiches; and 2) you can ask the clerk for directions.

Today consumers can just reach into their pocket for their mobile phone to find their destination. The market for mobile location-based services is clearly on an upswing. U.S. carrier spending on GPS/LBS marketing campaigns topped $30 million in the first half of the year and surely will increase during the holiday season. Much of that marketing spend is directed toward the traditional services such as fleet and workforce management, but favorable carrier deck placement for LBS applications and the bundling of navigation services with data packages have driven downloads to record highs. According to Telephia, over the last nine months, revenue from the mobile LBS applications market has tripled and there are no signs of it slowing anytime soon.  

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Where am I going?

Navigation makes up the majority of application revenue today. Sprint Family Locator and Verizon Chaperone are both new and interesting applications, but of the $200 million that will be spent by consumers on mobile LBS services this year, 87 percent will be for navigation. 

I believe there is a fundamental shift going on in the navigation business and it has to do with the age-old debate about device convergence. Consider the most popular single-function devices: digital cameras, camcorders, MP3 players, gaming devices and handheld GPS. Each of these has been incorporated into the mobile phone with varying degrees of success. The digital camera was wildly successful. But Nokia's N-Gage failed to compel gamers to drop their Gameboys. MP3 players are probably somewhere in the middle, although the game here is a bit different considering the iPod's iconic status. 

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David Gill is director of mobile media and senior analyst at Telephia, a service of The Nielsen Co. 

Telephia, a division of The Nielsen Company, is the world's largest provider of syndicated consumer research to the telecom and mobile media markets. Referenced in the column are recent findings from Telephia's Mobile Application and Multidevice Reports from Q2 2007.