Get out of the way, GPS. Wi-Fi is elbowing in on the location game. Wi-Fi operators are tracking people and offering retailers and marketers access to customers’ behavior and location. Traffic patterns emitted by smartphone Wi-Fi signals let network operators keep tabs on what shoppers are doing. Heat maps are being created with data from Wi-Fi points to map out aggregated customer behavior. Nearbuy Systems offers stores software that will let them track the website that a shopper is viewing, overlaid by where the shopper is within the store. However, beware of companies’ hyped up claims on indoor location. Another worry is the deployment of proprietary location systems which reduce overall usefulness. And some offerings are simply PowerPoint aspirations. In other news, Apple and Google are kings of the hill; in-vehicle mapping belongs to Nokia; and location privacy of a different sort.
Fragmented Indoor Location. If proprietary indoor location systems are developed, the market will be hampered. Ben Rodilitz of Level8 noted that, while attending GPS Wireless last March, he was bemused by the excitement regarding indoor location as manifested in a number of one-off, proprietary systems. If Home Depot used its own system, an airport used another, and a shopping mall implemented a third, ubiquitous indoor location would be problematic. “I know companies like Qualcomm, Broadcom, and SiRF/CSR were building competing platforms; one would hope this is a vehicle for best-of-breed choices for service providers,” says Rodilitz. I am glad to see the formation of the In-Location Alliance and the players who are supporting it.”
Other Complications. The nuts and bolts of indoor location aren’t easy peasy. “For detailed location pinpointing in places like malls, a high density of Wi-Fi radios need to be deployed and it isn’t super cheap to do so,” says Joseph DeStasio of Boingo Wireless. Stores may want to deploy a denser Wi-Fi system than in the outer mall. But it can be a clunky transition between two different Wi-Fi systems. DeStasio estimates that true mobile retail location-based advertising/couponing at malls is still 18 months away.
Mapping in Vehicles. Nokia may be battered, but the mapping it acquired years ago from its acquisition of Navteq is shining bright. Companies have long fought over “ownership” of the in-dash navigation market, and Navteq lords over the market, powering four out of five systems. Nokia has deals with many car makers, including BMW, Hyundai, Mercedes, and Volkswagen, as well as with Pioneer and Garmin.
Wireless Data Privacy and Mooching. There is always an interesting mobile location privacy case. In Pennsylvania, police obtained a warrant to search the house where child pornography was being downloaded. Police determined that the offender was a neighbor who had been free-loading on the house’s wireless Internet. The suspect was found with Moocherhunter, an app to identify wireless moochers. The suspect argued that police needed a warrant to use the app to locate him. The court ruled that he “could have no reasonable expectation of privacy in the signal he was sending to or receiving” from the wireless router.
More on Wi-Fi. Towerstream is building wholesale Wi-Fi access points across some urban regions, including Manhattan, with 1,000 access spots arranged in a giant dense honeycomb across the Big Apple. Before you equate this with previous municipal wireless disasters, know that these networks are several times fasters and don’t involve local government.
Towerstream is granting users four hours use with no charge if the user will interact with a location specific advertisement. These deals may be targeted to within dozens of feet of the user. Since service over Wi-Fi doesn’t count against U.S. mobile data limits, usage is particularly appealing to 18-34 year olds, who may be wallet constrained and open to viewing location-based ads in exchange for streaming video at high speeds.
Oligopoly! Google’s Android and Apple’s iOS continue to wipe the floor with their competition. Together they controlled 87.9 percent of the U.S. smartphone market in October, according to comScore. Android ended October with 53.6 percent nationwide smartphone share, increasing 1.4 percentage points over July. iOS grew its U.S. market share from 33.4 percent in July to 34.3 percent in October, a 0.9 percent improvement.
Tweet This. Use of social media and social networking is growing rapidly. Consumers continue to spend more time on social networks than on any other category of site—roughly 30 percent of total time online via mobile, reports Nielsen and NM Incite. Facebook remains the top social network, followed by Twitter and Blogger, but new social media sites continue to emerge.
Foursquare Wants Money. The tepid, if not poor, performances of social media IPOs has made investors skittish. The fates of Facebook, Zynga and GroupOn stocks have weighed heavily on this category. Foursquare, which pioneered location check-ins and is now succeeding with target location couponing, is having difficulty attracting added investment, reports the Wall Street Journal. Foursquare counts more than 25 million registered users, with only about 8 million accessing the app monthly. Some investors believe the company is moving too slowly to monetize.
Looking back at 2012, and this is our last column of the year, a number of stories in the location industry spring to the front. The rise of indoor positioning as a potential lucrative market is one. Another is perhaps Samsung’s purchase of CSR to give a major consumer electronics manufacturer even more location capability. Or the continued story of Google as the 800-pound gorilla in the location room. But, resoundingly, the top story probably has to be the controversy surrounding Apple Maps, which caused a shake-up at the company and industry. The incident made manufacturers realize that digital maps are a very important feature for smartphones. It also made many of these giant companies, who believe that location isn’t that big of a deal, sober up to the fact it is hard to make quality maps.
The top location industry story of 2012 may be a cautionary one for the industry. The big story was the release of Apple Maps in September, which was criticized by consumers for inaccurate driving directions, among other problems.
Apple had replaced Google Maps on its iPhone 5. But the criticism for the phone’s maps forced Apple CEO Tim Cook to apologize and even tell consumers to use such competitor’s maps as Waze, MapQuest or Microsoft’s Bing.
The controversy plagued Apple Maps app.
Since the last LBS Insider column, Apple fired Richard Williamson, who oversaw the company’s Maps team, according to Bloomberg. The initial report indicated that Eddy Cue, Apple senior vice president, is looking for a new management team to replace Williamson. The company is putting pressure on Apple partner TomTom to update mapping data and consulting with third-party mapping experts.
Marc Prioleau, managing director of Prioleau Advisors, said there are two basically two key points surrounding Apple Maps: “Maps are really hard to do. Maps were deemed to be an important asset for a major platform to own versus rent from Google.”
So what does that mean for Facebook, Amazon, Twitter and others dabbling in the location industry? “Can they get [quality] by using a potential competitors maps/local search or do they have to build their own? And if they build their own, how do they avoid the problems Apple has had?” Prioleau said.
The Apple Maps fiasco proved how important maps and navigation are to users of mobile phones, said Mike Dobson, TeleMapics president and author of an industry blog, which received huge readership during the incident. “In doing so, the company generated more ill will than I thought was possible when dealing with maps and navigation,” he said.
Industry Expert Looks Back on 2012
There were two significant trends in LBS in 2012, Dobson said. “The first was that the industry has transformed from a domain of specialists who seemed to be working underground to an industry that has caught the world’s eye as one of the most important technology families now in existence. It is a rare year when The Economist magazine writes an analysis that is focused on location as it did in its 2012 Technology and Geography Special Report,” he said.
Economist’s Annual Innovation Awards were dominated by people in the location industry, Dobson said. Computing and Telecommunications awards went to Jack Dangermond (ESRI) and John Hanke (Google), while Gary Burrell and Min Kao (both from Garmin) won awards for Consumer Products, he said.
“The second biggest trend in 2012 was the inexorable rise of Google to the top of the location chain. While Google quietly improved its databases, tools and location services, most other players in the location industry were slipping further behind, apparently involved in a frenzy of disorganization prompted by a lack of skills in strategic planning,” Dobson said. “What this torpor has led to is an apparent inability to produce market-leading products, as Apple has shown with Apple Maps and Nokia has shown with its negatively received mapping service. I suppose the rumor that the company is considering renaming the service ‘Here?’ is untrue.”
Through hard work related to early disappointments with the accuracy of its mapping products, Google has managed to learn a number of important lessons related to map compilation and data quality, Dobson said. “Perhaps the greatest lesson it had to learn was that algorithms used in mapping and navigation often need the intervention of an operator who understands geography, mapping and navigation. In addition, map compilation systems often need the assistance of a human with local knowledge to prioritize data solutions. Put simply, Google has confronted map accuracy issues and is rounding the curve on improved product quality.” To most everyone else, the main exception being ESRI, Dobson said he awards a hearty “shame on you.”
A final 2012 trend is that numerous capable leaders who led the “Location Revolution” are now on the sidelines or out of the industry completely, Dobson said. “For example, the majority of the ‘brain trust’ from Navteq, those contributors who understood the nature of mapping and navigation, are no longer with Nokia, a company that appears rudderless in the location marketplace. Just as it shows that most of the people who understood mapping and navigation at Tele Atlas are no longer with TomTom,” he said. “Other acquisitions produced similar results, as they always do. However, the crucial issue here is that losing history often means losing perspective and I am concerned that LBS is on this destructive path. While we always would like to think that as an industry we have institutionalized or memorialized personal contributions, problem-solving methods and other individually oriented contribution to products, this is never really true.
“While each new management team should have the right to rearrange the pebbles on the beach and say that the new organization of pebbles solves the problems of the previous organization, this is rarely the case. Innovation, not reorganization, are what makes a difference in all industry segments. As 2012 closes, I am tempted to ask, “Where are these market-making innovations in LBS?”
2013 and Beyond
While it was a big part of the LBS landscape in 2012, Dobson believes the current emphasis on indoor location is both overblown and being overhyped, but it will remain the focus of the industry in 2013. “This is yet another example of smaller players in the location world trying to find something new that they feel might help to get them acquired, while the larger players are hoping it is something that might provide a sustainable competitive advantage over Google,” he said. “I suspect that Nokia and Apple might now know what Microsoft knows — that in order to catch Google in location, you need to have a search engine that can successfully perform local queries that is tied to a source of revenue such as mobile advertising. My belief is that Google will continue forward integrating location as part of its effort to dominate advertising globally and locally. Until the other players catch on to this differentiator and field a powerful advertising-based competitor, they cannot be considered in the same league as Google.”
As a final shot, Dobson said he brought a lump of coal for those who enjoy “free” maps and navigation services. “My belief is that within the next decade mapping and navigation services will be fee-based. The addition of all the bells and whistles to online mapping services, in addition to other negative factors, are making the game too expensive to continue to give the product away for free,” he said. “Consider this bit of history. In the United States, before the Arab oil embargo of the 1970s, paper maps were given away free at gas stations. Also forgotten by many is the fact that someone pumped the gas, cleaned the car’s windows, checked the engine oil level and inflated tires to their proper pressure.
“After the oil embargo, price increases helped to beat the profit out of the system, as well as all of the other services it once offered such as free maps. Issues of net neutrality, telecom’s desire to recover infrastructure costs related to providing Internet services, indoor location infrastructure, and the decline of competition in the world of map and navigation data will inexorably lead to maps and navigation services that we will be required to pay for with real money, at least if we want the premium blend with all the bells and whistles.”
2013 Will Be a Big Year for Indoor Positioning
Because “outdoor” map solutions may be done because solutions only tell consumers how to get from Point A to Point B, indoor positioning is the future for LBS, said Kris Kolodziej, aisle411 vice president of location services. “Google already has about 10,000 maps worldwide. Aisle411 has 10,000 in the United States alone. It shows that retailers/indoor venues are using LBS and maps to engage the consumers and fight off the likes of Amazon,” he said. “Finding things indoors, inside stores and malls like products and offers. Retailers will need to get even more engaged and relevant if they want the consumer to shop at their store versus Amazon.”
Indoor positioning will be the big deal in 2013, said Mike Flom, LBS/Wireless App Consulting managing director. “Given its incorporation by major OS/smartphone manufacturers in their maps products and at least some progress on indoor location precision and quality, the usage growth and indoor map quality and coverage improvements should be exponential by year end,” he said. “A runner up to indoor positioning is built-in rich wireless maps and navigation for automobiles. There’s probably a higher expectation from consumers due to smartphones than delivery by automakers, but since when has the auto industry operated at consumer electronics speed?”
Smartphone Market Still Going to Drive LBS
The biggest trend of 2012 was the adoption of wireless GPS maps and navigation as a standard and differentiated feature on smartphone operating systems, said Flom, who believes that Apple’s introduction of their own free maps and navigation on iOS was the biggest event of 2012, along with Microsoft’s use of Bing Maps/Nokia Maps on Windows Phone 8.
“Why is this important? Approximately 85 percent to 90 percent of the U.S. smartphone OS market now has access to exceptionally rich, free wireless voice navigation. Penetration is similar in developed and growing fast in many developing countries,” Flom said. “The enormous penetration of smartphones means wireless voice navigation has gone from a crude novelty in 2002 to a sophisticated service with widespread penetration in under 10 years. The implication is all tablets, an extraordinarily fast growing product, now has rich, location-based map support. While only a small percentage currently have precision location functionality, such as a GPS chip or bluetooth GPS receiver, this is destined to change over time. Now that the basics are in place, more sophisticated features and content have a huge path to an enormous market,” Flom said.
Flom does not believe that the industry has been overhyped. “Given the extraordinary expense Google, Apple and Microsoft have gone to generate their own maps and voice navigation features, and the high rates of adoption, the hype was if anything too low. Each OS manufacturer could have simply let third parties continue to offer an app in their store,” he said. “The decision not to give third parties including Google the traffic indicates the importance of location and maps. The Apple Maps quality debacle, which eclipsed almost every controversy in the smartphone world, including patent wars and Siri limitations, showed that great maps are difficult and expensive. Apple’s adoption of their own map product cemented Google’s introduction of wireless GPS navigation as an essential and differentiated standard feature of smartphones.”
Mobile Advertising Still Looking for Market Share
Mobile advertising still is searching for a successful business formula, Prioleau said. “Every year it gets better but there is no sense that that has been cracked, at least if you look at advertising spend on mobile. The mismatch between time spent on mobile and ad spend on mobile has been well documented, but the gap isn’t closing fast,” he said.
In terms of location context, many companies don’t get it, but some do, Prioleau said. “It’s not just about where you are, and what’s nearby, but what does your location tell you about why you’re there, what you’re doing, and what or who you might be interested in,” he said. “Many companies are working on using location, along with other signals, to define context and from that pushing interesting information to the user — Highlight, PlaceIQ, Niantic, etc. It is early and it isn’t clear that anyone has got it right, but this will be an area of evolution going forward.”
In other LBS news:
Sprint Nextel rolled out its in-vehicle platform, Velocity, which allows auto manufacturers to offer buyers navigation, security, remote diagnostics, emergency services and infotainment. The unit, which was rolled out at the 2012 Los Angeles Auto Show, will be available worldwide to allow network providers to add connectivity, the company said. Sprint has been getting into the auto arena in a big way this year with its partnership with Chrysler Group’s Uconnect voice-activated vehicle communications system.
It’s all about knowing where people are located. The government and private companies are taking hundreds of millions of geo-coded photos of license plates creating huge databases of where you’ve been. Meanwhile, hyper local mobile ads don’t work when ad networks sometimes receive grossly inaccurate locations of targeted consumers. Xad has developed a way to evaluate and score the accuracy of location positions they get from publishers. Also, mobile ad spending may reach $2.6 billion by year’s end, and Nokia is fighting back against rivals with a new mapping solution for Apple users and automating 3D mapping collection through a purchase of Earthmine. Keep reading for details.
License Plate Snapshots. There hasn’t been much of an outcry over privacy from a huge location tracking operation that doesn’t require consent of the subject. Hundreds of millions of geo-coded photos are being taken of license plates throughout the country. These databases are being created by private companies and the government who use vehicle-mounted cameras. Records include a photo of the vehicle, license plate numbers/letters, time and location. Over two years the Riverside California police have collect two million unique license plate pictures using 49 camera-equipped vehicles. A citizen filed a California Public Record Act request and received a report containing 112 images of his cars. In some of the pictures he can identify car occupants and even the clothes they are wearing.
Private companies that started photographing license plates were initially in the business of repossessing vehicles. With a mounted license plate camera, they drive as many miles as possible through back alleys, parking lots and streets. An alert sounds when a license plate matches the repossession database. Some of these companies are evolving to focusing solely on license plate data collection and have gathered hundreds of millions of photographs. One of the companies, MVTrac , claims to have geo-coded photos of the majority of U.S. registered vehicles.
The data can be used for ill purposes. It can show who may be present at a political gathering, parked at a rehab center, or located at a cancer treatment center. In 1998 a police officer in Washington D.C. pled guilty for extorting owners of vehicles parked at a gay bar. The databases will grow. The Department of Homeland Security has provided more than $50 million in federal grants to police for more cameras.
A Drop in the Advertising Bucket. Advertisers will pay out $2.6 billion for ads on phones and tablets in 2012, predicts eMarketer. This is a small fraction of total ad revenue, less than two percent of advertisers’ overall spend. Yet, mobile ad spending is growing; it is currently triple 2010 spending. The king of mobile advertising is Google, which receives 56 percent of all mobile advertising.
Disparity among Apps. The amount of revenue from mobile advertising varies greatly among applications. Facebook reported 14 percent of its total ad revenue in the third quarter came from mobile. Almost 60 percent of Pandora’s ad revenue came from mobile in the second quarter. Twitter indicates that some days the majority of its ad revenue has come from mobile.
Problematic Location Accuracy. One of the issues of mobile advertising is the accuracy of the mobile user’s location. It is problematic to send a hyper local ad if the ad network receives a grossly inaccurate location position, perhaps a geo-code at the center of a zip code. xAd, a local mobile advertising network, has developed a technology that analyzes the multitude of location signals being passed by each publisher and scores them according to accuracy and performance. “The industry cannot take location signals at face value,” said Chi-Chao Chang of xAd. “What we have found through our SmartLocation technology is that location inputs are often inconsistent on a per ad request basis. In fact, some of these signals are just plain wrong.” As a result, ad campaigns may be running on inventory that is not suitable for granular targeting, resulting in wasted ad impressions and overall lackluster performance.
Automated 3D Mapping. Nokia, fighting to get back to the top of the heap, is acquiring 3D map-technology maker Earthmine and revamping Nokia’s mapping tools to win back customers from its rivals. The company announced a new mapping app for Apple mobile devices and unveiled the new brand name “Here” for its location services and website. Earthmine will provide Nokia with a complete solution for collecting, processing, managing, and hosting 3D street-level imagery. “This will add competitive advantages and increased differentiation to HERE‘s Location Content and Location Platform, sustaining competitiveness in B2B (e.g., data for in-car navigation systems) and drive highly engaging user experiences,” reads a blog on the Nokia website. The company believes that the Earthmine data collection vehicles are massively scalable and expect to be using them in 31 countries next year.
The month of October and now into November was filled with several conferences, but not a lot of location news. A few news snippets, while not blockbusters, were important. One was Waze’s decision to offer its own location-based advertising. Another was a milestone for Ford, which said its Sync information system is now in five million vehicles. On an end-of-an-era note, of which there have been quite a few in the last two years, Sprint has decided to drop the Nextel name. Nextel was one of the innovative companies in the late 1990s and early 2000s, placing location capability into mobile phones and jump-starting an industry.
Waze recently said it is offering a global location-based advertising platform that will be directed to its 30 million users. Waze, founded in 2009 in Israel, says smartphone users can try the service for free — the profit for them is ad revenue from local and large brands.
GPS World’s LBS Insider recently reported that Tim Cook, Apple’s chief executive, actually endorsed Waze as an alternative to its own mapping service after users were experiencing problems with it. Waze, which is offering the advertisements in the United States, said it saw a jump in downloads after the announcement.
Some industry analysts say it may be a mistake for Waze to swim in the deep end of the pool to compete with such mobile advertising giants as Google.
Waze raised a total of $67 million from investor Kleiner Perkins and Hong Kong investor Li Ka-shing. They cite big partners such as Circle K, Dunkin’ Donuts, MACS, Kum & Go, Wyndham Hotels, Jamba Juice, and P&G.
Palo Alto-based Waze is probably best known for its driving directions based on user input. The company says that its users spend an average of more than 7 hours in their vehicles a month.
The company, in order not to annoy users, is minimizing the number of pins on a map advertisement. According to published reports, the company said its advertisements will include coupons.
From the Waze blog: “We don’t want to bombard you, so you’ll never see too many businesses crowded on the map at once. Instead, the algorithm that powers Waze Ads aims to bring you a helpful selection of the various retailers around you on your daily drive.”
Waze is also making advertising inroads in Europe. It recently announced a partnership with Lumata, an Italy-based mobile marketing company. The deal allows Lumata to have a an exclusive right for advertising on Waze’s app in Italy, according to published reports.
Waze announced in June that car models will soon integrate the company’s mapping software. The company’s iOS and Android app’s users contribute road data while they drive, share accident reports, police speed traps, traffic jams and other data.
Five Million Sync Units in Five Years…
Ford and Microsoft’s Sync infotainment system has been installed in five million Ford and Lincoln vehicles. The unit, which was rolled out at the 2007 Consumer Electronics Show in Las Vegas, was one of the first products to allow smartphones to work with car components.
Sync was innovative in that it bundled turn-by-turn navigation, hands-free calling, text message reading, and other features. Earlier aftermarket products, such as Clarion’s AutoPC, were busts — but perhaps five-to-seven years too early for the market.
Ford jazzed up Sync with touchscreens and voice recognition since it rolled out its first model, which only used push buttons. It integrated other features such as audio, air conditioning/climate control, and navigation. Soon the newer version, MyFord Touch, offered video streaming, music, and a voice-activated climate control system.
Ford announced earlier this year that it was working with State Farm to add all Sync-equipped vehicles to the insurance giant’s Drive Safe & Save approved vehicles. A customer, through a voluntary sign up, can run a Vehicle Health Report that sends information to State Farm. Potential insurance savings for a customer could be 40 percent.
Ford is working with several industry companies, including Pandora and TeleNav Scout, through its AppLink program, which was globally offered earlier this year.
In other LBS news:
Sprint’s recent decision to drop the Nextel name was the end of an era, but not a surprise. It was Nextel, before its 2005 merger with Sprint, that truly innovated consumer and enterprise applications and markets on the mobile handset. In the wake of Japan’s Softbank purchase of 70 percent of Sprint, the Nextel part of the Sprint name will go away in mid-2013. The new name will be Sprint Corp. The Nextel brand was known for its iDEN technology and network, which is gradually being shut down by Sprint.
The recent U.S. presidential election had an LBS story. Foursquare had an app that had the goal of encouraging users to vote. The “I Voted” app allowed users to find their local polling station on Election Day and check in to show they cast a vote. Foursquare, trying to show that it offers more than “check-in” capability, recently announced a rating system for businesses. It is not clear whether the service, with 25 million users, is going after companies such as TripAdvisor and Yelp for a share of the evaluation/services market.
Samsung Electronics’ Galaxy S III managed to knock Apple’s iPhone 4S off the pedestal as the world’s most popular smartphone, in terms of sales, in the third quarter, said Strategy Analytics. Samsung sold around 18 million S III phones during the quarter, compared to Apple’s 16.2 million iPhone 4S units. The Galaxy S features a large touchscreen and GPS for location-based services.
October was a month of shows, rumors and announcements. Testing of competing indoor location positioning technologies is being planned by the FCC; prospects for some companies will ride on the public results. Apple may be turning to TomTom to save it from its mapping inaccuracy issues, dubbed Mapplegate. This month’s CTIA show was flat; attendees were wondering if it was the last chapter of the fall show. Interesting industry tidbits were heard at the MforMobile Location Business Summit. New Google Ad Word rates may be created that are also based on the distance between the handset and advertiser’s location. History can be harsh, remembering an unfortunate calculation by a location industry giant. Marketers continue to be frustrated by the mobile industry’s continued difficulty to completely measure ad results.
The FCC sees indoor location as a critical safety concern for E911 emergency response. The commission has tasked an advisory committee to evaluate indoor location positioning technologies. TechnoCom has been chosen to conduct the independent testing as a neutral third party. The test bed is in about 20 structures of various types, in locations that range from highly dense urban to sparse landscape. The following companies are submitting technology for the testing: Qualcomm (AGPS/AFLT/Cell ID), NextNav (GPS-like terrestrial beacons), Boeing (LEO satellites using the Iridium constellation), and Polaris (RF fingerprinting). Additional companies submitted technology, but later withdrew. Test results should be made public in March of 2013. A public workshop on this testing is being held at the FCC on October 24 and can be watched online at www.fcc.gov/live.
Indoor Mapping. At the Location Business Summit, it was clear that the retail and hospitality industries is anxious to start exploring indoor marketing based on real-time location. They seem to expect it will start out working flawlessly. It won’t. In addition to the indoor positioning being early stage, mapping quality is uneven. The gold bar of quality assurance for outdoor mapping is aerial fly-overs and street driving. In some situations crowd sourcing works. For indoor maps, it’s the Wild West. Currently there are no standards for vetting indoor mapping. Maps are being created of greatly varying quality, sometimes by way of rough diagrams found on the Internet that are then shoe-horned into the outlines of buildings.
TomTom to the Rescue? Shares in TomTom, maker of personal navigation devices (PNDs) and mapping, jumped to a three-week high on speculation that it may be taken private by its founders with the help of Apple. In turn, Apple could buy TomTom’s maps database to correct its mapping problems. TomTom’s founders own 47 percent of the company, but may be held back by the uptick in share value.
Paying for Location. Reportedly, Google has location-based AdWords in beta. Advertising rates go up the closer the targeted user is to the venue being promoted. A restaurant ad is more relevant, and more likely to draw a person who is one mile away than 20 miles. Some travelers will park near a string of hotels and use a site like hotels.com to find the most competitively priced room for that evening. An ad for a hotel on the other side of town is of lesser value and would be cheaper.
Comments Heard at the Location Business Summit by MforMobile this Month:
“We need to build ambient intelligence into devices. Nobody needs more information, more apps, ads, logins or devices. It isn’t sustainable.”
“Location data on the consumer side is often junky because phones are trying to conserve battery, and won’t invoke GPS.”
“You can get better locations from the carrier network, but it is too expensive a proposition for advertisers.”
“We find that hyper-local ad targeting leaves us with too few people to address.”
Can I Turn Back the Clock? In an interview for Forbes in 2003, Min Kao, CEO of Garmin, puts a stake in the ground. He says he does not seek to compete in navigation with the mobile phone, the likes of Nokia and Motorola, as that is the kind of commodity business Garmin would like to avoid. The PND vendors continue to be squeezed between the OEM embedded equipment and the smartphone. It is hard to be optimistic about the PND market, commented John Canali of Strategy Analytics at the Location Business Summit. Heavy discounting has led to plummeting revenues. “The PND companies are hardware focused in a market whose foundation is software. It will be very difficult to transform PND companies,” says Canali. “They will struggle.” In 2009, Google announced that all Android phones built on OS 1.6 or higher would have free turn-by-turn directions. Nokia followed shortly after. So it began.
A Little Slow. CTIA drew more than 5,000 people to attend MobileCon, its fall show with a new brand name. You may remember it as CTIA Enterprise and Applications. This was a significant decline from last year when 10,000 to 15,000 conference-goers attended. Activity was slow and the exhibit floor was smaller. Conference sessions were held on the exhibit floor.
Still Can’t Close the Loop. The industry continues to be unable to provide advertisers with metrics of how many pizzas a mobile ad sold. Papa John’s Pizza will know if someone has clicked to call or clicked to map, but Papa John’s won’t know if those actions resulted in a purchase. Without this fundamental metric, advertisers complain that it is hard to build a business case for mobile advertising. The click rates that they can track aren’t always representative because of user errors that include fat fingers, fraudulent clicks and pocket dialing.
The uproar caused by glitches in turn-by-turn and other features from Apple’s new Maps feature has forced CEO Tim Cook to make a public apology. It also has made some in the industry wonder why Apple decided to drop Google Maps in the first place — though many say it was the smart thing to do in the long run. In the meantime, indoor positioning technology and markets seem to be shaping, if not slowly, for serious commercial success in the near future. Some still have concerns about indoor positioning’s technical limitations, privacy concerns and consumer acceptance.
Apple recently told its customers to try competing map services while it improves its new mapping program. A recent uproar by iPhone users, who found that Apple’s new mobile maps gave them wrong directions right after the release of iPhone 5, has been dubbed “mapplegate” by some bloggers.
In a letter to customers, Tim Cook, Apple’s chief executive officer, said that iPhone customers try mapping services from Bing, MapQuest, Google and Waze through its apps store.
Cook, in his letter, apologized for the frustration caused by its mapping platform. He said that more than 100 million iOS devices use the new Apple Maps.
“We launched Maps initially with the first version of iOS. As time progressed, we wanted to provide our customers with even better Maps, including features such as turn-by-turn directions, voice integration, Flyover and vector-based maps. In order to do this, we had to create a new version of Maps from the ground up,” Cook said. “Everything we do at Apple is aimed at making our products the best in the world. We know that you expect that from us, and we will keep working non-stop until Maps lives up to the same incredibly high standard.”
TomTom, which provides the map data for the new application, has been tight-lipped about the fiasco. In addition, the move to TomTom has some questioning Apple’s move away from Google Maps.
One thing is for sure in this whole mess: the importance of location and mapping to consumers, something pundits have downplayed in recent years. A recent New York Times article said the Maps outcry “shows how map services, which Apple treated as an afterthought when it built the first iPhone, have become critical tools for millions of people.”
The Times article goes as far as saying that Apple executives were surprised by the popularity of the map function, but began to concern the brass there about how much iPhone behavior data was flowing back to Google.
Between this recent glitch and its decision not to join standards consortiums for indoor positioning, one wonders if Apple, or Google for that matter, really believes in the power and promise of location technology.
Aisle411 Says It Has 10,000 Indoor Maps
The mainstream media is touting indoor location as the next big thing for consumers. One company, aisle411, now with 10,000 indoor maps, says the future is now. The “so what” for consumers is the ability to easily search for products, says Kris Kolodziej, new aisle411 vice president of location services.
“Consumers want less stress when shopping; they want to be informed, and also have fun [and] be engaged,” said Kolodziej, who most recently was associate director at Verizon Wireless.
Aisle411’s product enables product search, indoor/store map, indoor location (around 5 meter/aisle level) and product recommendation through an ad engine. “Users can search for products. We then display the products on a store map, down to the aisle level,” Kolodziej said. “We also recommend products based on search and indoor location by displaying coupons and offers.”
Kolodziej says, as part of its 10,000 indoor maps, all 8,000 Walgreens stores are mapped. “You can find these maps inside the Walgreens app and inside the aisle411 app. Even Google does not have this,” he said.
Like all new technology, including GPS, standardization of maps and technology help to grow new markets. Some believe it is the Wild West for indoor positioning, which Kolodziej contends may be overblown. “Aisle411 figured out the technical issues related to scaling indoor maps and indoor location. Aisle411 generates the indoor maps and offers them in an XML format via our SDK and APIs,” he said. “Developers can access the product data and store maps via our SDK and APIs.
Big box retailers and other chains are showing big interest in indoor positioning, but the concern is will privacy and other issues slow it? “This Walgreens deployment is helping to educate the market, and other retailers, that this technology is what consumers want. Specific to indoor location, consumers are more open to sharing their location with their store/retailer vs. Google or anyone else,” Kolodziej said. “Since the store already knows you are there to shop, users are not afraid to share their location inside the store.”
Aisle411 recently purchased WiLocate’s technology assets — and a few patents pending as part of the deal. WiLocate’s positioning product, which allows access to mobile devices, leverages existing Wi-Fi infrastructure and sensor information, along with gyroscope and compass.
Google continues to be a dominant player in indoor mapping. It recently said that Galeries Lafeyette and supermarket chain Carrefour in Paris are now mapped. This includes information about ATMs, escalators, restrooms, what products are in different aisles, and walking directions.
Google has been mapping airports, museums and malls for some time. In addition to France, the company brought indoor maps to the United Kingdom and Switzerland last summer. In the United States, Google has mapped such places as Atlanta Hartsfield — Jackson International Airport; San Francisco International Airport; Mall of America, Bloomington, Minnesota; Caesars Entertainment, Bally’s Las Vegas; MGM Resorts, Monte Carlo Resort & Casino, Las Vegas; and Vallco Shopping Mall in Cupertino, California.
Google has also mapped such big-box stores as Home Depot, IKEA, Macy’s and Bloomingdale’s — though it remains to be seen when a Wal-Mart or Target will be included.
Analysts contend that the big indoor positioning players are Google, Microsoft, Research in Motion, Nokia and Qualcomm.
We are making history. The rate of iOS and Android device adoption has surpassed adoption rates for any other consumer technology in recent history, reports analytics firm Flurry. Android and iOS devices are being adopted at a rate 10 times faster than the rate of PC adoption during the 1980s. Smart device adoption is growing twice as fast as Internet adoption during the 1990s, and three times faster than that of recent social network adoption. Flurry estimates there were more than 640 million Android and iOS devices in use as of July 2012. The U.S., followed by China, has the most active iOS and Android devices. However, China had the fastest growth of active devices last year and its active user base will soon overtake the U.S. Other news this month includes security concerns with LBS offerings, developments in the indoor location market, voice navigation for bikes, and unusual election activities.
With cause, people are concerned about the security of location-based applications. In a poll focused on LBS security, a quarter of 1,000 Americans surveyed indicated both concerns about third-party use of personal information for marketing purposes and strangers knowing too much about personal activities. Surprisingly, about 20 percent indicated a concern for their actual personal safety. The poll was conducted by the non-profit security group, ISACA. Nearly one-third of consumers in ISACA’s survey use location-based apps more than they did a year ago.
It isn’t just LBS that carries security risks. Smartphones themselves are inherently vulnerable. “Every smartphone subscriber end-point is a potential threat to the mobile network and creates hundreds of millions of points of network vulnerability,” says Jeff Orr of ABI Research. Currently, protection is focused on hardware and end-user application security. To more ably face threats, defensive security measures will grow more sophisticated and encompass contextual information about usage, location, and user. Perversely, this is the same information sought by mobile advertisers. Today, carriers are focused on 4G roll-out and delivering the hottest handset, but they need to be just as concerned about security.
A Whiff of Hyperbole in the Indoors. The indoors location market is going to be big, but I think that ABI Research’s forecast of indoor maps and services reaching more than $2.5 billion by 2017 is overstated. I agree with their assertion that business models are changing with the most significant indoor mapping companies increasing their scope to include more revenue enhancing activities. These still focus on indoor location, but include application development, location technologies, analytics, and advertising.
Indoor Location Club. The In-Location Alliance has been formed by 22 companies, including Nokia, Qualcomm, and Samsung, to pursue high-accuracy indoor positioning and related services. One of their goals is to ensure a multi-vendor environment by promoting open interfaces and a standard-based approach. Members are encouraged to execute their own pilots and present their data to the Alliance. The primary solutions will be based on enhanced Bluetooth 4.0 low-energy technology and Wi-Fi standards using relevant existing or upcoming features of those technologies. Pre-commercial pilots and business model verifications will start in 2012, while 2013 is expected to bring mobile handset-based implementation, enabling the first consumer applications in the indoor mobile environment.
Enterprise GPS Doing Well Approximately 5.5 million GPS/wireless devices are used to manage fleet vehicles, trailers, construction equipment, and mobile workers, estimates C.J. Driscoll & Associates. By 2015, this market will expand to more than nine million units and annual hardware and service revenues will grow to over $3.0 billion, predicts Driscoll. Growth is expected to be strongest in the local GPS fleet tracking market, which is expanding at a rate of 15-20 percent per year.
Listen to Your Bike. Google has added turn-by-turn voice-guided navigation for bike riders in 10 Nordic and European bike loving countries. Bikers can either listen to the voice or view the route on a phone. In the U.S. and Canada, a beta version will be available. Google maps contain more than 330,000 miles of biking lines. These are color classified as either dedicated bike trails with no motor vehicles, streets with bike lanes, or other streets recommended for biking. Users can use Map Maker to add bike routes.
Election Coverage. You may have heard that a group called Crossroads GPS spent $5.3 million to run ads to defend Governor Romney’s proposed tax plan. Crossroads GPS is not a new faction of the LBS industry. Crossroads GPS (Grassroots Policy Strategies) is a conservative organization with an unlikely acronym.
Save the Date. I’ll be moderating a panel debate, “Opening up the Indoors for Location Services,” at MforMobile’s Location Business Summit 2012, being held in San Jose October 16-17. TheWhereBusiness and NFC Insight are now MforMobile.
Naysayers still exist when talking about the emerging indoor positioning market. They say that the market is still too nascent — and the technology is sub par and not there yet. However, there are just too many atmospherics, and big companies getting involved in indoor positioning development, to brush it off as another technology fad. The recent announcement that 22 companies are combining to come up with standards is a good example. Mainstream media articles touting the new market also are spearheading development and consumer interest. Still, how can you start an industry group and talk standards and markets without the two largest players?
In a move that indicates that there is a strong market, 22 companies recently partnered to create the In-Location Alliance. The new group, which includes Nokia, Qualcomm, Samsung Electronics and Sony Mobile, aims to improve and expand indoor positioning and related services.
Google, which has been the dominant player in location markets, was noticeably absent. Google has partnered with large retail chains and has mapped many indoor malls, airports and other facilities to help drive the market with its Google Maps for Android 6.0.
Another company apparently not part of the alliance is Apple, which recently ended its location data partnership with Google. Apple is launching its iOS 6 operating system update, called Maps for iOS, which features 100 million business listings and Yelp recommendations.
In a prepared statement, the group said it welcomes the addition of any new member “who is ready to further investigate business opportunities in indoor location-based services and sees value and benefits in industry collaboration.”
The In-Location Alliance says it will go after both the consumer and enterprise location markets, even though both have technical and market limitations for indoor positioning. The group said services it will focus on include real-time navigation inside buildings, directions to personalized products and promotions inside retail stores and malls, asset and employee location, customer identification, and security solutions.
Because the technology is widely available on smartphones, the alliance will focus its products on enhanced Bluetooth 4.0 technology and Wi-Fi to develop mobile services as a starting point.
The allied companies say they will conduct pre-commerical pilot programs and business model verifications later this year in order to launch handset-based applications next year.
Other members of the In-Location Alliance include Broadcom, CSR, Dialog Semiconductor, Eptisa, Geomobile, Genasys, Indra, Insiteo, Nomadic Solutions, Nordic Semiconductor, Nordic Technology Group, NowOn, Primax Electronics, RapidBlue Solutions, Seolane Innovation, TamperSeal, Team Action Zone and Visioglobe.
Nokia also has been developing indoor positioning systems that use 3D models, rather than 2D floor plans. Broadcom released a chip that supports indoor positioning through Wi-Fi, Bluetooth and even NFC.
Mainstream publications such as the Wall Street Journal and USA Today have written articles about indoor positioning as a potential burgeoning market. The articles say such big brands as Target, Walgreens and Home Depot are implementing indoor positioning and marketing strategies. Walgreens is partnering with Aisle411, which offers an application with 9,000 store maps.
Mapping Services Now on New Kindle Fire
The next model of Kindle Fire, Amazon’s tablet, will have mapping services installed as part of a deal with Nokia. What is noticeable is that it does not have location technology from Google, which is strange as it is the Android mobile operating system that powers the Kindle Fire. Published sources say Amazon will announce the agreement this month.
As our sister publication Wireless Pulse reported, Competitor Barnes & Noble recently adopted OpenStreetMap, through Berlin-based Skobbler’s ForeverMap 2 app, to allow developers to create Nook applications with location functionality later this year, according to published sources.
While the Nook line of products are Wi-Fi enabled, they lack pure play GPS capability. Although Nook devices don’t have 3G or 4G access of smartphones, it is a step toward developing location capability.
A basic version is free on the Nook, and a premium version costs $4.99. The Nook units with the location capability include the Nook Color and Nook Tablets.
Both the Kindle and Nook have one common thread — their parent companies opted not to go with Google Maps. Is the location giant taking notice?
20 Years of Covering Location Technology
September 2012 marks my 20th year of writing about the business of location technology. In 1992, the big GPS companies (Trimble, Garmin, Ashtech, Sony, Magellan, Rockwell) were trying to develop consumer applications that were evolving from their military technology developed for the recently concluded Gulf War.
Most of the news back then was in the form of government contracts, and some survey agreements, or evolving policy about GPS. It turns out that the consumer side was being developed not by the GPS industry, but intelligent transportation industry providers through the digital mapping companies Etak (now TomTom) and Navigation Technologies (now Nokia).
While the terms “telematics” and location-based services were not being used in 1992, some companies saw the potential for big dollars incorporating positioning technology into mobile phones. I wrote an article in October 1992 headlined “Rockwell Says GPS in Cellular Phones Means Big Business.” I quoted a few industry consultants at that time who said that they had doubts that it would be a big market because of the cost and size of the GPS chipset, antenna issues, and consumer acceptance. The big deal about putting GPS into cell phones was to meet an FCC enhanced 911 requirement, but that happened a few years later.
Such companies as Motorola brought the name “telematics” to North America and attempted to jump-start the market here. At least one industry executive never liked the word telematics, saying it was a “Stalinist” word.
While companies have come and gone, and the technology has evolved to a point that commoditization is pervasive, the promise of location technology and markets will still be strong. Companies and individuals have made fortunes and lost them in the location industry, but one thing for sure — it has never been boring covering and writing about the business and people.
With drive navigation nearing maturity, companies are scrambling to develop new offerings. Nokia and others are quickly building indoor mapping arsenals. We are edging closer to the LBS vision that early on defined the market: walk by a Starbucks and get a mobile coupon for a cuppa Joe. Qualcomm’s new Gimbal platform will not only speed the production of more sophisticated personalized apps, but will enable advertising that fits the immediate interests of the end user. Google wants to protect mobile advertising streams and has instituted rules to keep it consumer friendly.
Qualcomm has released Gimbal, a software developers’ kit that will help developers create personalized content, including sophisticated use of location. The platform will create a rush of apps that will utilize end users’ interests, location, and device sensors to create content that responds to an individual’s real-time situation and preferences. The industry is salivating over the type of marketing/advertising opportunities that platforms like Gimbal create. Contextual ads have been demonstrated to be much more effective than generic ads. There are uses beyond advertising, for instance, a reminder to pick up dry cleaning when in the vicinity, or bread when in a market. The Gimbal library is extensive and includes low-power, geofence-based location awareness, image recognition, privacy management, and other features.
In a move to further broaden Nokia, the company is focusing on indoor mapping and now claims more than 4,600 venues in 38 countries, a fast ramp-up from its Destination Maps launch at CTIA in 2011. These maps are more detailed than some others in the market and include escalators, floor levels, ATMs, and restrooms. Dynamic content such as movie listings, flight times, or transit schedules can be added for further value to end-users.
Nooking an LBS. As Apple and Google elbow for mapping dominance, Barnes & Noble has quietly launched maps and navigation for the Nook eReader and opened the door for location-based apps. The company is using the open-sourced OpenStreetMap database via Skobbler to enable developers to create location-based applications for the Nook. OpenStreetMap is a Wikipedia-like open source mapping project that could be the spoiler in the map race between Google and Apple. The Nook utilizes Wi-Fi, but lacks 3G, 4G, or GPS. I’m surprised that Amazon didn’t load the Kindle Fire’s Android version with Google maps.
Samsung Well Located. Leading handset maker Samsung has acquired the handset connectivity and handset location business of CSR for $310 million plus an added $34 million investment in the remaining CSR business. The details of the deal seem to indicate that Samsung has only purchased the technology license for GPS, not indoor location, said Liam Quirke of IMS Research. “If correct, this means CSR is free to sell its indoor location technology to other handset OEMs, and the reverse means that Samsung is not able to do this,” he adds. This is another move by Samsung to vertically integrate its business to cut costs.
CSR acquired Sirf Technology, a pioneer of commercial GPS technology, in 2009. Kanwar Chadha, founder of Sirf and a leader at CSR, has resigned. Chadha has been a cheerleader and visionary for the location industry.
Buy a $60 Massage for $30? Nokia is integrating Groupon daily deals into Windows Lumia device series. Users searching Nokia maps will be shown relevant deals alongside traditional search results. Microsoft’s forthcoming Windows Phone 8 operating system overhaul will install Nokia Maps as the default mapping experience. “Scale is critical to our growth,” says Michael Halbherr of Nokia. “That’s why the horizontal nature of the Windows Phone deal is critical.”
Ads that Leave a Bad Taste. Google is trying to rein in the most annoying and sometimes deceptive mobile advertising. Android apps available in the Google Play marketplace will need to follow new rules. The company has introduced stringent new mobile advertising restrictions as well as clarified payment, subscription billing, and spam policies. The new rules aim to stop misleading notifications or warnings that impersonate system notifications. The regulations also target apps that make changes to the functioning of the user’s device, outside of the advertisement. Google ads that force a user to click on ads or submit personal information for advertising purposes is strictly prohibited, and Google states that consumers must be able to dismiss an ad without penalty.
Not First to Know. Did you get the “Mitt’s VP” app so you’d know his choice before the media? “Mitt’s VP” smartphone app for iOS and Android promised to be the first place Romney would publicly announce his selection, but a news leak spilled the beans. The Romney campaign hoped the app would recover a stronger mobile presence after the release of “With Mitt” in May went awry. “With Mitt” contained an unfortunate typo that promised, “A Better Amercia.” An immigration issue?
Save the Date. I’ll be moderating a panel debate, “Opening up the Indoors for Location Services,” at MforMobile’s Location Business Summit 2012, being held in San Jose October 16-17. TheWhereBusiness and NFC Insight are now MforMobile.
There have not been many earth-shaking acquisitions of companies that have location as a big part of their offerings. However, the recent $310 million acquisition of CSR’s handset connectivity and location business by Samsung merits an additional look. CSR, along with Broadcom and Qualcomm, are looking at the indoor location market as a strong one in the next four years. In other news, the Mobile Resource Management market is seeing 20 percent growth—not a market with consumer excitability, but one that makes money.
The recent $310 million acquisition of CSR’s handset connectivity and location business by Samsung has put a number of competitors on notice. One analyst, Liam Quirke, IMS Research, says that because of GPS’ increasing presence on smartphones, and Samsung now being the largest handset manufacturer, it made sense for Samsung to want to own this part of the supply chain.
“This complements its already large manufacturing operations that supply a number of smartphone components, including its own Exynos branded application processor — in addition to manufacturing the Apple-designed Ax range of SoCs,” he said.
The Samsung-CSR transaction refers only to the mobile business (i.e., handsets and tablets). “Samsung’s GPS strategy here is inevitably focused around such devices. The trend within connectivity, particularly in devices with small form factors such as handsets and tablets, has been one of increasing integration,” Quirke said. “Connectivity has been packaged into a single chip with some IC suppliers also including GPS. An example would be Texas Instrument’s WiLink 8 solution. An alternative is to include GPS on the cellular baseband, a route which Qualcomm decided to take and has since begun to integrate into its application processors — and more recently also including Wi-Fi and Bluetooth.”
A number of restrictions placed upon CSR by Samsung, as part of the transaction, prevent CSR from selling a GPS product combined with an application processor into the mobile field for 10 years, hinting that this is a direction Samsung may take in terms of integration and subsequently removing additional potential competition, Quirke said.
In addition to the $310 million deal, Samsung will invest $34.4 million in return for 4.9 percent stake in the remaining CSR business. The completion of this acquisition is expected to be in the fourth quarter. Quirke said that as well as picking up the benefit of CSR’s patent portfolio, the acquisition also adds the research and development and marketing support for its Bluetooth and GPS technology for handsets.
The deal follows Samsung’s acquisition in June of Nanoradio, a developer of ultra-low power Wireless LAN for chipsets for devices such as smartphones and tablets, Quirke said. It also provides Samsung with the connectivity technologies with which to make an entrance into the wireless connectivity market.
During former founder Kanwar Chadha’s tenure at SiRF, which merged with CSR in 2009, the company acquired the GPS businesses of Motorola and Conexant as well some smaller companies such as Centrality, Enuvis, Impulsesoft, Kisel, and TrueSpan.
Indoor Location Market Will Be Important to CSR
CSR, along with competitor Broadcom, has become increasingly involved in the indoor location market, with the announcement of its SiRFusion location platform in November. However, Quirke said that the finer details of the transaction between Samsung and CSR indicate that Samsung has only purchased the technology license for GPS, not indoor location. “If correct, this means CSR is free to sell its indoor location technology to other handset OEMs, and in the reverse means that Samsung is not able to do this,” he said.
With that in mind, indoor location is one of the five key growth areas that CSR is targeting, Quirke said. “Indoor location, and the various applications associated with it, is centred around mobile devices and, as such, is why I feel CSR was eager to hold on to this portion of their mobile business. Indoor location remains a nascent market with much potential, particularly when considering the opportunity to provide highly targeted marketing material in commercial venues such as shopping malls — not to mention the opportunity in the enterprise space,” he said.
IMS predicts in its “Indoor Positioning, Mapping, Technology and Services 2012” study that 110,000 supermarkets, shopping malls, or large retail stores will have indoor maps by 2016, making extensive use of indoor location technology.
CSR has struggled in the mobile space in recent years, while Broadcom and Qualcomm have continued to succeed on the back of their strengths in connectivity combining ICs and cellular baseband chips, respectively, Quirke said. “Current indoor location solutions offered by the major IC suppliers reside on the GPS chip itself, making use of a number of wireless technologies and MEMS sensors. In light of this, CSR will need to provide a compelling reason for a handset manufacturer to choose its indoor location solution over one from Broadcom or Qualcomm,” he said. “On a more positive note, early indications suggest that CSR’s solution may be slightly ahead, in terms of providing an accurate working solution — of those from Broadcom and Qualcomm.”
Enterprise Market Strong…
In other industry news, the leading suppliers of GPS fleet management solutions for the local fleet and enterprise markets are continuing to grow at a strong rate, nearly 20 per year, said Clem Driscoll, president of CJ Driscoll Associates.
“FleetMatics, the largest supplier to small fleets, filed an S1 in May and the IPO is expected in the near future. Telogis continues its wave of acquisitions, most recently NavTrak, said Driscoll, who has completed his “2012-2013 Mobile Resource Management Systems Market Study” that profiles 100 MRM suppliers in several markets.
A strong trend in MRM for both local fleets and the trucking sector is monitoring driver behavior, Driscoll said. “Many suppliers monitor speeding, acceleration, deceleration, speed on turns, etc., and generate driver scorecards to identify the best and riskiest drivers,” he said. “This monitoring of driver performance, along with engine idling time and route adherence, also helps fleet operators minimize fuel consumption, which is a major concern these days.”
Everyone wants a piece of the pie, the upcoming indoor location pie. Big companies and start-ups are engaged, some in research, others having launched solutions. While Wi-Fi is the most common technology, many companies are pursuing alternate methods, including GPS, audio, Bluetooth, small cell/cellular, distributed antenna systems (DAS), near field communication (NFC), white band, sensors, movement tracking, beacons, and more. Of the large players who are making a play for the indoor market, Cisco, Google, Microsoft, Motorola, Nokia, Qualcomm, RIM, and TCS are the furthest along, reports Grizzly Analytics.
At a minimum, indoor technology will do what we do outside and enable GPS-style mapping, navigation, local search, check-ins, location-sharing, and other location-based services. An explosion of other uses will evolve, enabling search for items on store shelves, sending deals, and contextual advertising. This newsletter issue is devoted to looking at smaller companies, those not listed above, many start-ups competing for their piece of the pie.
A pool of smaller indoor companies is focused on creating positioning technology, many ripe for acquisition. Navizon, sensewhere, and SkyHook are betting on unique approaches to determining indoor location position. No longer solely focused on driving the streets to map Wi-Fi signals, Skyhook has adopted a comprehensive approach to indoor location, integrating multiple technologies (GPS, Wi-Fi, cell, and sensor-based) to ascertain location, a solution that offers the advantage of flexibility. Navizon is focused on Wi-Fi signals, currently the most popular solution for indoor location. There are sometimes existing Wi-Fi nodes, but added nodes can usually be fairly easy to install. From a business standpoint, the downside of Wi-Fi positioning is the large number of competitors focused on solutions. sensewhere is pursuing an entirely crowd-based software offering that locates and cross-references publically broadcast information, including MAC addresses, from consumer devices. It is the easiest solution. No infrastructure is required, but it requires a certain density of devices.
I’ve asked Navizon, sensewhere, and Skyhook to write, in their words, about their company, technology and perspective on the industry:
Navizon – InTheir Own Words. “Navizon Indoor Triangulation System (I.T.S.) uses Wi-Fi signals to provide indoor location throughout a building or campus. Navizon designed this system to locate users of smartphones, tablets and laptops, all of whom rely heavily on Wi-Fi. This real-time locating system’s infrastructure uses small, easily deployable nodes connected through a mesh network. No wiring or software installation, and only minimal configuration, are required. The administration dashboard is an online interface to Navizon’s cloud. Integration is through a web services API. This design delivers an affordable indoor location platform, with room and floor-level accuracy, up and running in a single day.” Cyril Houri, Navizon
sensewhere – In Their Own Words. “sensewhere technology automatically locates and cross-references RF access points via user devices to create an almost limitless proprietary, reliable, live, global RF location database. The solution does not require additional infrastructure installation nor calibration or re-calibration when the venue’s RF infrastructure changes. sensewhere technology is powered by patented algorithms that dynamically adapt to indoor environments to optimize the use of mobile device resources. Commercial benefits have been demonstrated in the largest shopping malls around the world where more than half of RF infrastructure can change within a few months.” Rob Palfreyman, sensewhere
SkyHook – In Their Own Words. “Location technology company Skyhook, provides seamless operation of indoor and outdoor mobile device positioning using integrated GPS, Wi-Fi, cell, and sensor-based positioning technologies. Venues have been hesitant to get involved with indoor location due to concerns over control of their data, cost of initial deployment, cost of maintenance, accuracy and consistency of the technology, and availability to deploy on a large variety of devices. Skyhook is involved in industry efforts to provide venue owners the ability to manage their infrastructure data in a consistent, standardized way that addresses both the technical and business needs.” Ronda Billings, Skyhook
Positioning technology is of limited use without indoor venue maps, which might include shopping malls, arenas, convention centers, and hospitals. Retail is very interested in being able to direct people into their stores, to a particular aisle, or even shelf location. Meridian, Micello, and Point Inside have distinct approaches. Micello creates indoor maps by using data found in public domain; their customers are not the venues, but the developer community. Meridian creates indoor maps based on maps drawn by customers and adds navigation and points of interest. At its start, Point Inside had a similar focus, indoor map creation, but has since integrated positioning data and added an ad network to its solution. Point Inside is targeted to retailers.
I’ve asked Meridian, Micello, and Point Inside to write, in their words, about their companies, technology, and perspective on the industry:
Meridian – In Their Own Words. “Meridian is focusing on providing software to allow employees of a location-based business to create an indoor way-finding app for visitors. The system enables a customer to upload maps (CAD, etc.) that are then converted into vector files. Points of interest and turn-by-turn directions can be generated. The turn-by-turn directions can work with any wireless connectivity, from basic 3G to more sophisticated Wi-Fi systems. Indoor venues can achieve a GPS-like experience — that ‘glowing blue dot on the map’ — some are seeking. Meridian is seeing adoption from retailers, hotels and hospitals.” Jeff Hardison, Meridian
Micello – In Their Own Words. “Micello is a provider of indoor venue maps, including shopping malls, airports, college campus buildings, hospitals, retail stores, casinos, and stadiums in over half-a-dozen countries throughout the world. Micello uses proprietary, in-house mapping and navigation tools combined with map-manufacturing tools and dashboards. The technology ingests various sources of data and information about a given venue to create a well-defined, structured set of indoor map data. In the next 36 months, every building will have an app and mapping technology, integrated with positioning technology. Information will be automatically sorted and organized for users based on where they are located inside.” Ankit Agarwel, Micello
Point Inside – In Their Own Words. “Point Inside provides retailers with detailed indoor maps, exact product location, and dynamic shoppers locations to help stores engage with in-store customers. The user’s shopping list, which is entered into the application, enables high-converting, hyper-targeted advertising. With indoor location technologies advancing too quickly to pick a single winner, Point Inside uses proprietary algorithms to combine results from multiple location technologies to determine the most accurate fix. Primary technologies include: proprietary Wi-Fi fingerprinting, motion sensing to determine movement from known locations (such as product locations); partnership with other location providers; and correlation with indoor maps to determine valid locations.” Todd Sherman, Point Inside
How does this shake out? It is too early to tell. In the coming year, I expect the indoor location market will be better formed. Consolidation will occur. Some companies will drop out and others will be purchased. Grizzly Analytics suggests eBay, Local.com, Amazon, Microsoft, Apple, GroupOn, TI, Qualcomm, CSR, Google, foursquare, and Google are all shopping or looking for strategic alliances to develop indoor location offerings. Time will tell who eats pie.
The Social Loco conference in San Francisco highlighted brands leveraging social location. However, it seems as if the conference focused more on the social than the location element. As one attendee said, “Location as a topic is almost like electricity as a topic, it’s just there.” In other industry news, veteran location executive Kanwar Chadha is moving on…
SAN FRANCISCO — Most companies and attendees at the recent Social Loco conference here realize that while social is big, and such companies as Home Depot and Kraft are looking hard at it, the location part of it still has detractors who don’t know what to do with it.
The problem with social location advertising is that ad execs and large companies don’t understand it — or know how to spend money against it, said Marc Prioleau, managing director of Prioleau Advisors.
Prioleau said location industry executives would talk to each other on who is going to rule the world, with little effect. “[The problem is] that no one came from brand backgrounds and were hacking around an application, rather than focusing on a brand’s objective. Some of the ideas that were hot two years ago…aren’t so hot now,” he said.
The big impact of location-based services, or social loco marketing, is getting consumers to take specific actions to get into a store, said speakers on a mobile panel. Location is relevant when a company can use it as a signal of intent to bring in a five- to 10-percent conversion [sale] rate. “There still has to be relevant and interesting ads, which will open the floodgates for innovation to come in,” said one panelist.
Proximity marketing may be the key ingredient to making LBS a big part of a brand’s advertising strategy. Panelists believe that a large part of consumer purchasing comes in the proximity of someone’s home. Around 40 percent of mobile searches are local.
The fact that a lot of searches are local is not enough, said Di-Ann Eisnor of Waze. “[Users] say that, ‘I am doing this thing already, what else could I be doing [around this area]?” she said. “Intent becomes very powerful — people sharing that intent.”
A venture capital speaker said that brand managers at Pepsi, Gatorade, Mountain Dew, and others are holding back money to find new ways to have consumers “buy that one more can of Pepsi.” He said that brands are looking at social location as ways to try something they haven’t before. “They will get some air time with some senior leaders because of that,” he said.
Still, hard to convice die-hard VCs that location is the way to go. “Social loco [constitutes] two important elements [of advertising]. But I don’t wake up and say, ‘Let’s do a social loco deal today’ — what is this business going to build over time?” asked John Malloy of BlueRun Ventures.
One VC said that LBS is a technology, not necessarily a business mobile. “Investing in mobile, yes, but that’s like saying we invest in people who walk around on two legs. The challenge with location is that it tells me where I am, but not necessarily tells me what to do,” he said. “We need to see a connection to revenue. That’s a challenge with companies such as foursquare — to get a distribution to a network of merchants. Until you are getting paid, it’s just theoretical.”
Travel May Be LBS Niche Market
Using social location applications helps travel companies, airlines, hotels, and others in that industry find customers, said panel members. “Consumers are starting to look at social commerce and social proofing as a way to intelligently tap into friends. They are looking at five hotels my friends have been to,” said Kevin Fliess, Room 77 general manager and vice president of products. “Location and price is a huge consideration — and reading reviews from friends has more value than reading anonymous reviews.”
“One of the challenges we face — location is sensitive — how they can share their trips [is important]. Clearly, the more options you deliver is confusing to consumers,” Nancy Ramamurthi, TripIt vice president, product management and marketing.
One of the off-shoots of travel may be photography. David Staas, CEO of jiwire, said that the company surveyed 800 mobile consumers who used smartphones as the primary device to take a photo. “There is a location component to it; 31 percent want to remember where they took the picture,” he said. “Men and women we surveyed had different behaviors. Women want to use location to communicate with a broader network; 91 percent take pictures on the go; 20 percent of them are more likely to location tag.”
Big Names and Big Companies Rarely Say Anything
At such conferences as Social Loco, big-name entities such as Facebook and Google speak, which draw attendees. Sad thing is that none them say anything, most knowledgeable industry vets agree.
Emily White, Facebook’s director of mobile partnerships, was a keynote speaker at Social Loco and fits in this big-company, no-substance conference speak genre. Yet the big media outlets, because it was Facebook speaking, quoted her with the earth-shaking news that mobile is important, and, hold on to your seat, “the web is being rebuilt around people.” Note to these big companies: Cut the PR stuff and ‘I’m so hip and my company owns the world’ talk, particularly when you are talking to a crowd of savvy marketing executives.
Privacy Is Dead: That’s News to Me
Actually, really isn’t news to me. Anytime a conference has a privacy panel, you know that fireworks will ensue and nothing ever gets resolved by the time the panel ends.
Social Loco’s privacy panel was no different. One panel member said privacy is boring. “It’s boring to legislate, like seatbelts and helmets,” he said.
A Qualcomm speaker said the company has a lawyer who does nothing but work privacy issues. Another speaker, in a rather politically incorrect manner, said more people are harmed from the Catholic Church than by Facebook’s location privacy policy.
Chadha Leaving CSR/SiRF after 17 Years
After more than 17 years with SiRF, including three as chief marketing officer following a merger with CSR, Kanwar Chadha is moving on. In a note to colleagues, he said he has “decided to move on and explore new destinations in my journey of adventure and discovery.”
When Chadha co-founded SiRF in 1995, the company wanted to sell GPS for consumers, which was revolutionary as most in the industry were still trying to sell survey equipment.
“Many thought we were pipe dreamers, some felt we were foolish to enter a market dominated by big companies with a technology controlled by the Department of Defense, and others looked at us as another flash-in-the-pan start-up,” he said. “We were technologists and evangelists at the same time. We developed innovative technologies and products to make GPS work in environments that system was never designed for, but are important for consumer usage such as urban canyons and dense foliage; all keeping in mind price points that mainstream consumers could afford.”
Chadha was proud of an idea book he called “Navigations,” which outlined “futuristic, but artistic concept devices and scenarios highlighting potential use cases of GPS in our daily lives,” he said. “Things we may take for granted today but seemed quite far-fetched in 1995. It was expensive collateral, but probably the best I have done in my life, and it became quite popular,” he said.
During his tenure at SiRF, the company acquired the GPS businesses of Motorola and Conexant as well some smaller companies such as Centrality, Enuvis, Impulsesoft, Kisel, and TrueSpan. He was at the company during the 2004 initial public offering and its merger with CSR in 2009.
“Many of the original SiRFers have moved on, and I have focused my last three years on helping transform CSR into a ‘platform-focused company’ from being just a component supplier. There are many interesting challenges ahead, such as making indoor location reliable and meeting consumer expectations with location across a broad range of applications,” Chadha said.
