For two hours Tuesday, New York’s always-noisy Times Square could become one of the easiest spots in the world to find a friend.
Boost Mobile, a so-called mobile virtual-network operator owned by Sprint Nextel, will offer a two-hour demonstration of buddy-tracking technology created by a start-up called Loopt. The start-up, founded by two Stanford University graduates while they were still students, is the latest to offer a mobile-tracking system that enables people to do things like get a bead on friends’ whereabouts.
It certainly won’t be the last. For nearly a decade, technology visionaries have talked of a day when people would be able to use their cell phones to get directions, track their friends, keep tabs on their kids or simply find the nearest coffee shop. Now those services are finally starting to take trickle into the marketplace.
“The most common text message that people send is, ‘Where are you?'” said Mark Jacobstein, executive vice president of corporate development for Loopt, which is partnering with mobile operators to offer a mix of social networking and so-called location-based services. “So the ability to automate that becomes a really valuable service.”
Of course, other companies have similar offerings. Dodgeball, bought by Google last year, connects thousands of customers in 22 major U.S. cities with a service that enables users to type in a location and broadcast it to their friends.
Mobile virtual-network operators Helio and Boost have developed services to automatically track and alert people about their friends’ location. Other services, such as Groundspeak’s Geocaching, let cell phone users participate in a mobile scavenger hunt. And Verizon Wireless, Sprint Nextel and Disney Mobile have offerings that help parents track their children’s cell phones.
These companies could be on to something. If analyst predictions are correct, more than half of the cell phone users in the United States will be using location-based services by 2010. That’s a staggering figure, considering that, as of today, less than 2 percent of the 219 million U.S. cell phone subscribers have even tried using one of these offerings, according to IDC.
That’s expected to translate into big dollars for the cell phone industry. In 2006, location-based services generated $150 million in revenue. By 2010, it’s expected to generate $3.1 billion, IDC said.
“We’re still very much in the early stages of adoption,” said Scott Ellison, vice president of wireless and mobile communications at IDC. “For the past five years, our research has indicated that end users have understood how they want to use these services, but the industry as a whole has been reluctant to offer it as a commercial service.”
Putting privacy issues to rest
While mobile operators see potential in offering location-based services, they’ve been concerned about privacy issues and the accuracy of the technology. But as the technology improves, and privacy concerns are dealt with, new services are popping up left and right.
Loopt, founded in 2005, offers a mobile tracking service that enables cell phone subscribers to share their real-time location status, messages, photos and other on-the-go information with their friends from a mobile phone. Using Global Positioning System (GPS) technology, the application automatically updates the location of a user’s “buddies” and displays the information directly on a map on the phone. Alerts can also be sent to notify subscribers when a friend is near.
During a demonstration of the prepaid offering Tuesday morning, people will be able to win prizes like Knicks tickets and consumer electronics by using the Boost handsets to locate Boost representatives throughout the demonstration region.
The service has already been available on a limited basis for the past six weeks. Already, 40,000 subscribers have signed up, with about 5,000 new subscribers being added every week, said Sam Altman, the 21-year-old CEO of Loopt. Boost plans to pump up those numbers with a multimillion-dollar advertising campaign starting Monday.
The service is free to any Boost subscriber until the end of 2006. Next year, subscribers will be able to try the service for 30 days for free; after that, it will cost $2.99 a month, including a mobile-blogging tool.
The launch of the Boost Loopt service comes a week after Helio, an MVNO (mobile virtual network operators piggyback on or contract with bigger networks) backed by Korean operator SK Telecom and EarthLink, kicked off its own location-based buddy service. Like Boost, Helio targets young hipsters, which experts say are more likely to use location-based services for social networking.
“For the young people we’re targeting, being with their friends is the most important thing,” said Loopt’s Altman. “And they are very willing to share their location so that they don’t miss out on anything.”
Offering services based on a subscriber’s location is not a new concept. But up until recently, most of the services offered have required users to type in an address or ZIP code to either broadcast their location, find local businesses or get directions.
“The fact that many of these services haven’t been automated has inhibited adoption,” said IDG’s Ellison. “If you’re driving through a neighborhood and you want to find the closest movie theatre, you might not know the ZIP code.”
Now, companies like Loopt are working directly with mobile operators, which under mandate from the Federal Communications Commission, must embed technology in phones to track their location in case of an emergency. Compliance with these requirements has taken a long time to implement. And for the most part, the technology used by most operators is rudimentary at best.
“Carriers implementing E911 are only required to provide location information within about 100 meters,” said Iain Gillott, founder of iGillottResearch. “That’s a big area, when you think of a densely populated urban area. The joke with E911 services has been that if you’re in a downtown area and you call for help from a cell phone, you’d better light a fire in the middle of the street to let the emergency crew know exactly where you are.”
But the technology is improving. And many services, like Boost Loopt and Helio, now use GPS technology to more accurately calculate a cell phone user’s coordinates to within a few yards, using satellite signals.
Still, mobile operators are treading lightly into this tracking tech. Verizon offers its VZ Navigator service that provides directions and mapping, but it has not yet launched a full-blown buddy-tracking service.
Instead, it offers a very targeted cell phone-tracking service called “Chaperone” that allows parents to keep tabs on their kids. To help ensure that the service isn’t abused, Verizon has implemented strict parameters: It’s offered only in conjunction with the LG Migo phone designed for 7- to 10-year-olds. And the service can be added only to an existing family calling plan.
“We are really interested in the whole social-networking experience and the extensions that mobility offers those applications,” Verizon spokesman Jeffrey Nelson said. “But we are concerned about privacy and security, especially when designing a service that deals with children.”
Loopt executives claim that they have developed safeguards to ensure that mobile-phone users are tracked only by people they know and only when they want to be found. For example, the first time a subscriber tries to track a phone, a phone number must be used, and a text message is sent to the owner of that phone, who must reply in order to enable tracking. Loopt also offers individual-by-individual privacy settings so that users can “hide” from specific individuals and literally drop off of their map.
Of course, there are ways around security safeguards. And it’s these details that worry operators such as Verizon Wireless.
“We have a lot of concerns about making sure a tracking service is done right,” Nelson said. “The last thing we want to do is let a genie out of a bottle and find that the service is misused.”