Operators lose prime position for LBS

BOSTON, USA: Wireless carriers are increasingly losing control of location-based service provision to Internet companies such as Google and Yahoo, and to handset vendors like Nokia, according to “Location-Based Services: Opportunities within an Emerging Battleground,” the latest report from the Strategy Analytics Wireless Media Strategies Service.

Operators have focused primarily on navigation, people locators and ‘find the nearest’ services, but struggled to drive location service adoption for each of these categories.

However, the development of cell tower databases by companies such as Google and Skyhook, along with the integration of location APIs onto handsets, has enabled the development of a diverse set of location applications for distribution through popular channels, such as Apple’s App Store and Google’s Android Marketplace.

“Strategy Analytics expects that these elements, combined with greater GPS handset ownership and data plan adoption, will trigger growth in location-based service revenues from $650 million at the end of 2008 to almost $8 billion by 2013,” comments Nitesh Patel, Senior Analyst, Wireless Media Strategies, at Strategy Analytics.

Over 80 percent of these location revenues will come from location-enabled search and voice-guided navigation applications.

This report also identifies Google and Nokia as significant threats to carrier ambitions. David MacQueen, Director at Strategy Analytics, added: “Nokia has made significant moves in location-based services through its acquisition of mapping data provider, Navteq, and smaller companies, such as Plazes and bit-side. Nokia’s significant handset market share, combined with its ability to integrate location applications onto its handsets, places it in a strong position to compete with carrier and internet brands for ownership of location service users. Similarly, Google’s significant brand strength and carrier independent location positioning database threatens to disintermediate the operator from the location services value chain.”