New Study from SNL Kagan 'Checks In' On Mobile Location-Based Services

LBS Services Growing Says Study

Mobile phone location-based services (LBS) are beginning to gain traction, according to SNL KAGAN’s seminal study of the wireless industry, "Economics of Location-Based Services."

According to SNL KAGAN, active users of LBS in the U.S., which includes registered users of location-aware social networks and monthly subscribers to carrier-based family tracking and navigation services, could hit 33.2 million at year-end 2010, up from 12.3 million in 2009. SNL KAGAN points to increased smartphone adoption as pivotal to the upward trajectory of location-based services. By the end of 2010, 41% (118.1 million) of U.S. wireless subscribers will be using smartphones, which is expected to rise to 50% next year.

The study reveals that location-aware social networks are starting to attract consumer interest, with the leading six companies combining for a total of 18.1 million registered users as of SEPTEMBER 2010. FOURSQUARE is the fastest growing service, with an average quarterly growth rate of 273% since second-quarter 2009.

SNL KAGAN indicates that advertising is still in the nascent stage for location-aware social networks, with 2010 revenues only expected to total $11.9 million for the top six combined. As SNL KAGAN analyst JOHN FLETCHER notes, "Cashing out from checking in will largely come from advertising and promotions as the services have a unique ability to communicate with users while they are on the town with wallets and purses in tow. For now, most social location networks are currently pursuing a land grab and focusing on growing users to attract advertisers."

« see more Net News