Location-Based Services: What’s it All About?

By | April 26, 2011

I’ve been seeing some great posts lately on the The Digital Nirvana that cover many different aspects of mobile marketing and technology, including mobile 2D barcodes, mobile content delivery, and more. In light of a number of very recent events, and to build upon my last post about data security, I wanted to cover one additional aspect of mobile marketing and technology: location-based services (sometimes referred to as LBS). In the context of mobile, location-based services leverage the GPS and wireless broadband capabilities in a smart mobile device to drive hyperlocal applications.

One of the more basic applications of LBS is the GPS feature on your smartphone. Perhaps you’ve taken advantage of some of the more advanced applications built on location-based services, as well; you may have checked in to your favorite restaurant on foursquare or Facebook Places, found a good bookstore close-by on Yelp, or even found the nearest post office on the USPS app. These apps use your device’s GPS to determine your exact location and then use your wireless broadband connection to deliver localized information or entertainment to your screen, all in the matter of a few seconds. This accomplishment is pretty astounding when you think about it, and in many situations, highly useful.

If you’re not familiar with the prior example of “checking in”, it is typically a function of a location-based game or social network where a user “checks in” or submits their coordinates to prompt a location-based action. In LBS games like MyTown, your check-ins earn you points to level-up in the game. In LBS social networks like Facebook Places and foursquare, the place you are visiting is shared with your friends, and you’re even able to redeem coupons or discounts from the businesses you frequent.

Especially in major metropolitan areas, local businesses use these types of offers through something like “foursquare for Business” to generate loyalty with their plugged-in customers. Foursquare also works with brands to do location-based marketing for hyperlocal engagement. Some vendors and service providers, including Konica Minolta and Harte-Hanks (respectively) used foursquare at recent trade shows to engage with attendees and bring traffic to their booth.

While there are lots of impressive, useful applications of location-based services and significant growth is expected in this area, location data privacy has been in the news quite prominently over the past twoo weeks. Researchers recently announced their finding that Apple’s iOS tracks location data and stores it in an unencrypted file on your mobile device, which you can actually visualize using a desktop application the researchers created. Apple stated that some of this information is shared to help improve user experience over time. Later in the week, it was revealed that Android phones also track location data in a similar type of on-device cache. Apparently Microsoft does the same thing with its newest Windows mobile OS, as well.

What do these findings mean? In the end, probably not much if you’re a law-abiding citizen (these location databases have been used in forensic analyses for law enforcement). Still, with recent data breaches on our minds, and the prospect that these location caches are not encrypted in any way can certainly stir up thoughts of how this location data can be used if someone steals your device, for instance. Many users are clearly concerned about their location data privacy. Companies throughout the entire mobile ecosystem, from carriers to device manufacturers to app developers, need to be transparent about what data is stored, how it is stored, how it is shared/used, and how it can be protected. By clearly communicating this information and giving users the option to easily opt-out of location services (and make sure that opt-out actually works), the stigma around location data can be lifted.

There is immense potential still to be reached with location-based services, especially for local businesses trying to connect with their customers in new ways and for brands that want to engage with people in a unique way. Through transparency, choice, and clear value, LBS can move from a privacy concern to an effective tool for marketers and consumers. Service providers that are getting more involved with digital media need to seriously analyze if and how LBS fits within your suite of services; the opportunity is still too large to ignore.

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2 thoughts on “Location-Based Services: What’s it All About?

  1. Skip Henk

    Bryan,

    Great post! Being beyond my biological prime I have mixed emotions regarding the subject. I will admit I use applications like where to find restaurants and other things but it is I who opens the application and chooses to share my location and receive the information I am looking for (kind of an opt in)

    At the same time I would also welcome “intuitive” messaging. As I walk by a store and suddenly receive an offer for 20% off of all items in the store … HOWEVER I believe this too should be an opt in scenario.

    Maybe what manufacturers need to include is a “airplane mode” option that allows people who want to be tracked to do so, and those who want to drop off the grid, can.

    I know from a forensics standpoint this could potentially impact law enforcement but I think they have enough other tools in their arsenal.

    I also must admit, although not surprised, that the iphone and Android announcements did not set well with me. I know if one is a law abiding citizen there should be no issue but as the father of (8) if law enforcement can track my kids, so can others.

  2. Bryan Yeager Post author

    Skip, thanks for your comment! You bring up some great points. Typically if you have a smartphone, there is a feature in the settings/preferences where you can turn off all location services, although this does naturally have an impact on the applications that rely on location services to function. I believe in most cases, you can also control each application’s use of location services.

    Nevertheless, there are still major issues with the fact that these manufacturers are storing location data in an unencrypted, easily-accessible file on the phone itself. You bring up a good point about law enforcement; if they really need to, they can subpoena a wireless carrier to access your location information, and I believe that’s the process that should be followed versus extracting it from your phone.

    Apple and Google have been called to a congressional hearing on mobile and location privacy, and Apple has announced that they will provide an update that fixes this issue in the near-term. Hopefully these companies will be more transparent about how location data is collected and used, as transparency will be the only way to spur increased adoption of this extremely useful technology (at least in my opinion).

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