Though mobile operators
continue to lose control over location information with the increased adoption
of GPS, the strong growth in global location-based services presents some
potentially significant revenue opportunities for them if they focus on the right
areas, according to Pyramid Research.

 

Following many years of
high expectations, the location-based services market is finally coming of age.
Revenue is expected to reach US$10.3 billion in 2015, up from$2.8
billion in 2010,” said Jan ten Sythoff, analyst at Large for Pyramid.

 

“There are a number
of different factors driving market growth, including increasing GPS and
smartphone adoption, success of new business models, continued growth of mobile
advertising and the wider coverage and higher speeds of mobile networks,” adds ten Sythoff.

 

Growing adoption of GPS
devices is
the key driver, helping a whole host of different applications and services to
grow. For mobile operators, this is an opportunity to drive new revenue
streams, but it is also a threat because it means access to location
information is no longer their monopoly. In 2008 operators gained around 80
percent of all location-based service revenue. This has fallen to around half,
but the total market has grown more than fivefold.

 

Navigation, local search
and people-locating services are the key areas for operators to target.
Developed markets in APAC with very high GPS penetration, such asJapan and South
Korea, are progressive in offering location-based services, people finding and
advertising in particular while emerging regions such as Africa &
theMiddle East and Latin America have much lower GPS and
smartphone penetration, and consequently there are fewer opportunities for
location-based services. Regulatory factors are driving investment into some
markets while some operators are launching location-based services to
differentiate in competitive markets such as Nigeria.