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Where For Art Thou?

Sun, 08/31/2008 - 6:50pm
Brad Smith

GPS is starting to become part and parcel of mobile phones.

GPS has been around for more than 40 years, longer than cellular telecommunications networks. But the two technologies have been on converging paths for years, so much so that staid GPS is Where For Art Thou?becoming a disruptive technology in the wireless industry.

It appears GPS and mobile phones are going to have a long life together, with each technology changing the way the other works. GPS in the consumer electronics world has been closely tied to navigation. That will be true with GPS and cellular, but cellular opens up a host of new opportunities for applications and services that are just starting to be explored.

Farmers use GPS combined with cellular, as do their counterparts in the construction industry, to keep track of equipment and monitor their efficient use. The City of New York uses them to mark needed street repairs for workers. Parents use them to keep up-to-date on their children’s whereabouts. Foodies use them when they’re traveling to find the best restaurants. Social networkers use them to take and location-tag photos and share them with their friends.

In fact, GPS rapidly is becoming to cell phones what cameras once were. Just as it is hard today to find a cell phone without a camera, so it will be soon with GPS, especially as more smartphones are purchased by consumers. The analyst firm Canalys said 38% of the smartphones sold in the second quarter of 2008 had built-in GPS. And, with Bluetooth in most phones now, it is possible to have a GPS accessory for phones that don’t have GPS chips built-in. Most carriers expect the majority of their new phones will have GPS built-in later this year or early in 2009. Nokia has said it expects to ship 35 million GPS-enabled devices this year, more than the combined volume of all personal navigation devices (PNDs).

GPS ENABLEMENT
Nielsen Mobile said earlier this year that nearly two-thirds of the mobile application revenue earned by wireless carriers was generated by location-based services. ABI Research has forecast that LBS revenues globally will increase from an estimated $515 million in 2007 to $13.3 billion in 2013. ABI said personal navigation and enterprise services will be the highest revenue-generating LBS services for carriers.

Harry Wang, an analyst with Parks Associates, said he expects global shipments of GPS-enabled mobile devices to increase nearly 40% annually over the next five years, reaching 834 million in 2012. Wang said in a report that most of those mobile devices will be phones, although PNDs will constitute the majority of GPS devices for the next three years.

Mobile Devices: GPS-Related Apps (Q2/07)
Source: Parks Associates

Wang said GPS already is embedded in 8% to 15% of cell phones being sold today, with 120 million to 130 million GPS phones sold last year. By 2012, about 755 million GPS-enabled phones will be sold, he forecasts.

As with cameraphones, GPS is being integrated in handsets with the anticipation that consumers will use the capability. While there is no hard evidence that photos taken on cameraphones ever leave the phones themselves, Wang said he does expect that GPS and LBS have a better chance of reaching a broad market and adding to carrier bottom lines.

Navigation and live traffic updates have obvious compelling utility for commuters, he said, as does the ability to check for the best gasoline prices nearby. The updating capabilities of cell phones has already been noticed by PND manufacturers, which are adding this feature by including Wi-Fi connectivity or even coming out with their own cell phones, such as Garmin’s delayed NuviPhone. Finding friends or family members also is attractive to some people, Wang said.

A relatively new phenomenon has been the emergence of location-based mobile social networking from such companies as Pelago, Loopt and GyPSii, as well as services offered through Nokia’s Ovi brand. ABI analyst Dominique Bonte forecast in a recent report that these social networking applications would generate $3.3 billion in revenues by 2013. Bonte noted that privacy concerns will be one of the hurdles these social networking services will need to overcome with.

Boston-based uLocate is working with many U.S. carriers to offer a number of LBS services on GPS phones, plus some non-GPS phones. uLocate has a friend-finder application called Buddy Beacon, as well as an underlying platform called Where that uses widgets for a variety of LBS applications. Where is being used by AT&T Mobility, Alltel, Boost, Helio, MetroPCS and Sprint. There is a Buddy Beacon application on Facebook as well.

BLUETOOTH TRAJECTORY
Among the LBS services available on Where are Yelp for reviews of restaurants and other local services, StubHub for ticket purchases, GasBuddy, Skymap for star gazers, Pubwalk for local pubs, and the location-aware quiz application named Quibblo for polling and surveys.

David Hildebrant
Hildebrant: Like Bluetooth, GPS is becoming a must-have feature.

David Hildebrant, a senior marketing manager for GPS services at AT&T Mobility, said GPS in phones is following the path of Bluetooth. It’s a must-have feature for many subscribers and handset OEMs are starting to put GPS into most of their handsets.

AT&T offers a Navigator service on every GPS-enabled phone it sells, Hildebrant said, and recently started offering a global edition of the service that works in 20 countries. Navigator provides spoken or text-based turn-by-turn directions and includes a business finder feature.

Hildebrant declined to say how many subscribers use Navigator, but said AT&T offers it free for 30 days and that subscribers who use the application three times in a month are 90% likely to sign up after the initial period. He also said GPS and navigation are top of the list of talking points for sales people in AT&T stores.

AT&T Navigator and Mapquest Mobile were two of the top 10 selling applications offered in the second quarter, Hildebrant said, adding the majority of AT&T handsets sold in 2009 will have GPS.

Dan Gilmartin
Gilmartin: There’s an increasing awareness of location-aware LBS.

Dan Gilmartin, marketing vice president for uLocate, said the company has 1,200 developers who write applications to use on the Where platform. Right now, he said, there are more than 80 different LBS applications for Where, making it possible for subscribers to personalize their GPS experiences.

Where was one of the most popular downloads for Apple’s new GPS-enabled iPhone, with 300,000 downloads in the first month, Gilmartin said. The iPhone is helping create mass-market awareness of mobile LBS, driving increased use of these services on multiple handsets, he said.

“We’re seeing increased demand across the board for LBS in mobile,” Gilmartin said. He said uLocate is starting to offer advertising through its applications, offering the application for free to consumers if they accept banner ads that are relevant to their location and interests. “We’ve got a real opportunity to deliver context-based advertising,” he said.

One of uLocate’s partners in location-based mobile advertising is Nokia, through the Finnish company’s interactive alliance set up through Nokia’s acquisition of Enpocket.

Nokia has been edging more and more into GPS and location-based services, including its acquisition of Navteq and the social networking company Plazes, Nokia Maps, Sports Tracker, and Ovi. Nokia Maps 2.0, downloaded more than 240,000 times since February, provides car and pedestrian navigation, multimedia city guides and satellite images. Sports Tracker lets users log workouts or hikes and post associated photos.

Bill Plummer, who is in charge of Nokia’s go-to-market strategy in the United States for these services, said what makes these services “disruptive” in the cellular world is when they provide context to an application. Using GPS-enabled services with cell phones lets users share the context of where they are, an image they have just captured or music they have heard, plus the ability to share these through social networking, Plummer said.

“This is the beauty of the LBS experience. You can marry your physical presence with your virtual presence,” he said.

One Forum Nokia application called Mobile Web Server makes it possible for a user’s Nokia S60 device to be visible on the Internet, which further can be enabled so a user’s friends can see where the user is and what he or she is doing. With two-way communications enabled by Ovi through a social networking site like Facebook, a friend could ask a user to take a photo of where they are.

Navigation is popular both with consumers and with enterprises. AT&T’s Hildebrant said enterprises are quick to see the benefits in efficiency and helping keep fuel consumption down. Business and state and local governments like tracking features so they can document the movement of workers, particularly to verify inspections, he said.

TeleNav, which offers GPS navigation and tracking services as well as social networking and local search, believes the combination of GPS and cellular is starting to change the way enterprises do business, according to Sal Dhanami, co-founder and senior marketing director.

“We’re at the tipping point,” Dhanami said. “We need further awareness that there is this thing in the phone that a company owner or individual can use to help them.”

TransCare, a large ambulance service in the Northeastern United States, recently started using TeleNav’s Track service to improve response times and internal communications. TransCare deployed the service with Sprint Nextel handsets to manage 1,600 field employees and 200 ambulances. TeleNav’s services also are available on AT&T, T-Mobile USA, Alltel, Boost and other U.S. and foreign networks.

Dhanami said GPS-enabled cellular services are catching on with enterprises and TeleNav has seen a steady uptake of such services as its asset tracker. “There is a critical mass of customers forming now,” he said.

John Deere’s Intelligent Vehicle Systems builds GPS and cellular into its equipment to help with tracking and harvesting.

John Deere, the large farm and construction equipment manufacturer, has been using GPS and cellular for years. It has a business unit, John Deere Intelligent Vehicle Systems, that builds GPS and cellular into equipment for telematics and sensors. John Winter, general manager of the business unit, said it’s used for vehicle diagnostics, theft prevention with geo-fencing and even to tell where crops have been fertilized and harvested. John Deere also uses GPS to guide tractors through fields.

Clint Allaman, product marketing manager for the company’s JDLink product in the Construction & Forestry business unit, said JDLink uses sensors to keep track of vehicle fuel usage, machine maintenance needs and security. John Deere’s communications partner is Qualcomm.

Companies and individuals that use John Deere equipment are increasingly interested in features like JDLink to increase vehicle up-time, productivity and lower their daily operating costs, Allaman said.

“As fuel costs rise and with the housing market so poor, the construction business has been tough,” he said. “In an environment like today, we’re seeing more and more customers looking at the benefits [JDLink offers].”

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