Location Based Services To Reach 2 2 Billion

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Location-Based Services To Reach $2.2 Billion

By: Mike Sachoff
2009-07-10

Global consumer location-based services (LBS) subscribers and revenue are on track to double in 2009, according to Gartner.

Despite an anticipated 4 percent decrease in mobile device sales, LBS subscribers are forecast to grow from 41 million in 2008 to 95.7 million in 2009 while revenue is predicted to increase from $998.3 million in 2008 to $2.2 billion in 2009.

Gartner defines LBS as services that use information about the location of mobile devices, derived from cellular networks, Wi-Fi access points or via satellite links to receivers in (or connected to) the handsets themselves.

"The LBS industry has matured rapidly in recent months through a mixture of consolidation, improved price/performance of the enabling technologies and compelling location applications," said Annette Zimmermann, senior research analyst at Gartner.

"Factors driving the increase in the next year or so include higher availability of GPS-enabled phones, reduced prices and appearance of application stores."

Gartner predicts that ad supported or "free" (excluding data charges by mobile carriers) will gain more traction as user adopt it as a way to manage costs. Mobile carriers that stick with the business model of charging users $5 to $10 per month plus date plans will experience high churn rates as users will look for free alternatives. In North America and Western Europe, the share of users opting for free services is about 10-15 percent today and is expected to grow to 40-50 percent in 2013.

"The competitive landscape will change and most mobile carriers need to alter their approach toward offering LBS and dealing with developers," said Ms Zimmermann.

"Subscriber growth will hinge on "free" - disregarding data charges - services. Mobile operators' initiatives to open up the application programming interface (API) to third-party developers will help them compete against other players in the market and will also be beneficial to the different parties involved, down to the end user."

About the Author:
Mike is a staff writer for WebProNews. Visit WebProNews for the latest ebusiness news.


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