Where are you?

Where are you?

Jason Laight, managing director at Romexworld

Jason Laight, managing director at Romexworld

Richard Leyland, WorkSnug managing director
Richard Leyland, WorkSnug managing director

Location based services (LBS) are starting to enrich core mobile services, such as SMS and voice, creating a more dynamic and compelling location offering for users. No longer will we need to ask “Where are you?” at the beginning of every phone call, or not be able to locate our staff on the road. Heather McLean takes a look at where this market is right now, and how dealers and resellers can use it to their advantage.

The products and services that are going to sell and be sticky in mobile LBS are the ones that deliver a tangible and measurable return on investment to the end customer, states Jason Laight, managing director at Romexworld. “These are products that offer high value, without large additional capital investment and extensive contractual lock in. Additionally products that converge with existing solutions, such as mobile applications that can be delivered on existing handset hardware, will be very attractive. This enables customers to get more out of existing investment by sweating their current technology and assets.

“Solutions that deliver benefits against health and safety and compliance are a very interesting opportunity for the dealer market, as this gives them a totally different approach to the customer sale. This immediately differentiates the dealer in a competitive sale, as they are offering high value solutions that touch all parts of the business not just the mobile side,” remarks Laight.

Not clear cut

Yet Richard Leyland, WorkSnug managing director, notes: “The issue of profitability in terms of LBS is not clear cut. There is a culture of giving applications away for free. Once you start down this path, it is very difficult to start charging, as we are seeing, for example, in the media industry where they are trying to charge for previously free content.

“Furthermore, there is a lot of uncertainty around LBS because no one has indentified the main usage drivers behind the technology, such as for what reason might someone feel the need to communicate with their network or enterprise? Or, what would make a physical location relevant to make a user want to interface with software? At present these drivers are unclear, yet the next twelve months should see this situation change,” adds Leyland. Guy Redmill, managing director at Redmill Communications, notes: “Location itself isn’t valuable. It’s how it relates to other data that makes it powerful. Is the asset in the right place at the right time? Are your staff where you expect them to be?”

App-tastic times

Augmented reality is one of the most interesting developments in LBS development, says Leyland. The ability to overlay digital information onto a real view of the world is a very powerful tool, he says. “Through augmented reality, users can locate their nearest cafe, restaurant or even the quietest place to work using the WorkSnug application, which also incorporates Plantronics’ decibel meter to accurately measure and report noise levels, and locate a quite place to work.


“Augmented reality tools are very popular with consumers because they provide users with a depth of added understanding about their surroundings that they otherwise would not have had,” he continues. “Furthermore, applications like Foursquare and Gowalla take the LBS concept one step further, allowing users to communicate their physical location to people on their network using geo-tagging. This could be very useful to businesses seeking to target customers with real time, location-based offers.”

Jon French, executive director of UK, Ireland and South Africa at HTC, remarks that there are some incredible location-based apps, with more coming out all the time. “Augmented reality services such as Layar and the ability to search the web with pictures you have taken with Google Goggles are standout examples,” he says. “They were hard to imagine a few years ago, but have transformed the way consumers use their mobiles today.

“We’re really pleased with how popular our weather app has been with customers; GPS means your HTC phone automatically updates with the local weather, and the clock automatically updates to local time. These may seem like small details but they build a great user experience where people wouldn’t expect value to be added, as well as making life a little bit simpler for users,” adds French.

HTC Footprints is another application that uses location-based technology to provide a richer user experience. Footprints enables users to capture a digital postcard on their phone. As well as identifying each postcard with its specific GPS co-ordinates, Footprints also auto-names each postcard with the location or general area, enabling the user to retrace their steps and revisit favourite and special places.

Redmill says one use of LBS is asset management and tracking, the ability to offer fleet management and device tracking services confers many advantages, from security to cost management. The same techniques can be applied to human agents, or physical assets, providing security and assurance.

Also, Redmill notes that geofencing is another category of location-dependent billing or policy control, in which bills can be established based on location. For example, in FMC applications, users could be billed at a reduced rate when within a defined zone, such as the office. Similarly, users might be permitted to make certain categories of calls within specific areas, but not others.


Mobile ads and marketing

Leyland remarks: “Enterprise software is a multimillion dollar market and a route where LBS could succeed in the customer relationship management area. The ability to understand the location of a target customer in real time is very useful for businesses seeking to provide them with location based offers, and could be very profitable for dealers.”

Airwide product marketing manager, Jim Chou, agrees that some of the most interesting applications of LBS are in mobile marketing and advertising. “Marketers’ constant struggle to target customers more accurately can now take on new dimensions; with the inclusion of location based services and applications layered on top. Using LBS to create easier point of purchase and customer touch points in real time are the obvious benefits. But also consider LBS’ ability to let marketers’ further control brand perception and recognition on the fly.”

Some companies, such as ShopAlerts and McDonald’s, are already starting to implement located based marketing and have seen success. Chou points to ShopAlerts, an opt-in programme which delivers messages about sales to consumers as they enter a physical location. Research from ShopAlerts found that 75% of users found messages somewhat to very useful, and 73% would definitely or probably use ShopAlerts in the future. McDonald’s saw a 7% click through rate and an increase in a drive of consumers instore using their location-based mobile advertising, adds Chou.

Chou continues: “One of the strongest location use cases is when people are searching for things, like business and friends. For business that is a good thing, as they need to do little to benefit from this major use case. For example, if a business is in the yellow pages, its address will generally automatically be pulled into online directories, and then location-based apps like Google maps will display their location when a mobile phone user looks for the business using their mobile phone application.”


How to sell

Daisy’s director of mobile operations, Russell Horton, says while business people need to eat and want to be able to find the nearest hotel after a long meeting, there are other saleable LBS features which could make a huge difference to the way a business operates. “For example, there are lone worker-type solutions where organisations that have employees entering potentially hostile environments are able to track the whereabouts or last location of that person using a multitude of software based applications.

“Lone worker applications can also provide a pre-programmed panic button, whereby a user in danger can simply press a key on the device that will silently dial an emergency 24/7 response desk, or the client’s own support desk, alerting them that the user is in trouble and providing their whereabouts. The business opportunities for dealers are endless,” continues Horton.

On selling LBS, Laight observes: “It does need a solution-led approach. LBS products and services can touch so many parts of a business that it needs a structured approach. Some of our key partners are finding great success by focusing on vertical markets and becoming experts on specific sectors of in industry. It’s also clear that going back to existing clients with these types of applications enhances contract renewal and extension, which is great for the retention game and has slowed heavy customer churn rates from traditional mobile customers.”

Laight states that interesting LBS applications in the market supplement decreasing mobile connection revenues and help dealers increase revenue and margin, while building a strong ongoing revenue model within the dealer’s business, which may not have previously been a focus.

“LBS will enable a whole host of new products and services, but one theme we are witnessing now is solution convergence,” notes Laight. “In many ways it is no different from what has happened time and time again in the IT industry, where ‘integration is king’. For example, we provide employee management (tracking), turn by turn satellite navigation, job despatch and a lone worker panic alarm on one device. Even now, some end customers are still buying separate devices such as PDAs, PNDs and panic alarms to get the breadth of solution that they can instead get from us on a wide range of high street smartphones.”


Operator role

Horton says mobiles have come a long way since simple ring and text services. “LBS is the next phenomenon knocking at the door. Gartner predicts that in 2010, advertising-based or free LBS (disregarding data charges by mobile carriers) will gain more traction as users adopt it as a way to limit costs. Gartner’s view is that the mobile carriers that stick to the current, predominant, business model of charging users a monthly fee plus data plans will experience high churn rates, as users will look for free alternatives. It is vital that plans are put in place now to ensure that there are still margins to be had in this sector and a compelling offer to boot.”

Chou notes: “While the current buzz around location apps has clearly focused on the applications themselves, operators have, and will, continue to have a vital role in making these applications even more relevant to end users, and in turn more beneficial mobile marketers and brands. Take GPS for example; while an increasing number of mobile devices offer built-in GPS functionality, operators can also tap into their network to expose location APIs even for non-GPS phones. This makes the addressable market for LBS even larger and that much easier for application developers, and mobile marketers, to tap into.”

Continuing, Chou says: “We expect to see more and more location-based applications out there. We also expect to see carriers increasing their activities to make network-based location via web-friendly APIs, so that non-GPS phones can take advantage of LBS. As they do this, LBS will multiply. AT&T is just now rolling this out. ParlayX, a web services standard, is now supported for location access and next year RESTFUL APIs will be supported, which are even easier for developers to use.”

While Motti Kushnir, CMO at, Telmap, comments: “More and more application providers are exploring location based advertising as a potential business model, as end users’ expectations are to get many of these services for free. Telmap believes that mobile operators should provide a free LBS offering on all devices, across all operating systems, and then monetise the service through location based advertising as well as up-sell of premium services on top of the free offering.

“Premium services will most likely consist of services that are unique to that specific market, bringing highly customised local content that end users are willing to pay for, as well as stay loyal to,” observes Kushnir.

Thinking ahead

On where the LBS mobile market is going, French comments: “There is a lot of creativity coming from developers all over the world and at every level, from professional labs to enthusiasts at home, which makes the market exciting and unpredictable. At HTC we support innovation by opening up our source code so developers can tinker with the very heart of a handset to deliver a special experience for the user.”

Jon French

Jon French, executive director of UK, Ireland and South Africa at HTC

Russell Horton
Daisy’s director of mobile operations, Russell Horton
Summing up the mobile LBS market, Leyland states: “Although in its infancy, the LBS market is a hotbed of innovation and is constantly changing. The potential of LBS is still largely untapped because as yet, there isn’t a truly compelling reason for people to use it. Having said that, given the innovation and ideas that are coming to life in this space, I am confident that this breakthrough, when it comes will be very significant, and isn’t too far away.”
The following two tabs change content below.