LBS revenue to grow to $13.3B by 2013: Study

By Mickey Alam Khan

April 4, 2008

Where are you?

A new study claims that revenue from location-based services will reach $13.3 billion worldwide by 2013, a dramatic rise from the $515 million estimated for 2007.

The projections, from ABI Research, are based on the increasing supply of WCDMA and GSM handsets along with other CDMA-based services incorporating GPS functionality. Growing consumer demand for personal navigation capabilities on their mobile phones also gives LBS a leg-up.

“The interesting thing about the LBS content-producing sector is that much of the information is already available,” said ABI industry analyst Jamie Ross in a statement from London.

“It’s a win-win situation for content providers: they already have established markets for their map and POI data – automotive and telematics – and LBS is yet another that could potentially provide them with considerable additional licensing revenue,” he said.

In its report, titled “Mobile Location Based Services,” ABI profiled five categories. Personal navigation and enterprise services are projecting to generate the most revenue of them, with forecasts of $4.3 billion and $6.5 billion, respectively, each year by 2013.

Other LBS consumer applications that will gain popularity in the next few years include friend-finder, local information searches, family tracker applications and enterprise applications such as workforce tracking and fleet management.

ABI expects that the friend-finder application will be the next to launch for mass consumption.

But LBS’ success depends on key service-related developments.

The wider availability of all-inclusive data tariffs will grow service usage. This in turn will allay consumer concerns over the costs of data value-added services such as LBS.

Most importantly, the cross-network interoperability of services will determine LBS’ growth. As services provided on one carrier work across another, friends and family will increasingly interact with each other regardless of network.