Home News Business LBS market to grow by 16 pc: ABI Research

LBS market to grow by 16 pc: ABI Research

London, UK: The location-based service (LBS) market is set to grow by 15 percent by 2016, but it must adopt new business models, move up the value chain, and forget about Western Europe to achieve this, according to ABI Research’s new study, LBS Platforms.

The market has been heavily impacted by the emergence of off-deck application stores, continued delays to caller location mandates (e.g. E911), and carriers’ reluctance to invest in their own LBS platforms. While GPS penetration grows rapidly outside of North America, it has still to reach the levels where carriers feel there will be a strong return on investment (ROI). As a result, the market has remained relatively stagnant over the last two years.

A number of measures are required to stimulate the market. “LBS platform vendors must utilise their advantages over off-deck platforms and move up the value chain supporting non-consumer applications like child tracking, employee management, lawful intercept, payment/insurance verification, location based advertising, etc.,” said Patrick Connolly, senior analyst, telematics and navigation. “Navigation will remain a key segment, particularly in Latin America, but vendors must change their models supporting hosted approaches and flexible revenue share models. Looking to the long term, they must also find a solution to the indoor location problem.”

In particular, the lack of caller location mandates worldwide is helping to create a new security/lawful intercept market, with a number of deployments already established in Europe and the Middle East. By supporting an end-to-end solution, LBS platform vendors can secure strong recurring revenue in this space, with estimates breaking the USD 30 million barrier by 2016.

Dominique Bonte, group director, telematics and navigation, said, “The Western European market remains in a catatonic state without a firmer E112 mandate, unwilling to invest in LBS yet unsure how to compete with off-deck application stores. LBS vendors must look to other regional markets, while continuing to find a solution that can stimulate this region.”

ABI Research’s new study outlines a number of ways that the LBS platform market can continue to drive growth in new regional markets and application areas. It focuses on a range of applications, including child tracking, enterprise, navigation, security/lawful intercept, and location-based advertising.

Source: ABI Research