Will mainstream mobile users “check in” to location based services?

By Anthony De Rosa
February 18, 2011

It’s easy to get a skewed sense of reality in the media centric world that is New York City. It’s even easier when you work and live around folks enamored with shiny new gadgets and the apps that run on them. The app that most of my friends are using is Foursquare, but I would venture to guess the greater majority of folks outside the metropolitan area are not.

Foursquare recently reached 6 million users, an impressive number. An even more impressive number, they were adding users at a rate of 100,000 a week last summer. Foursquare grew to 1 million users in six months, something it took Twitter two years to accomplish. Although it took Foursquare two years to reach 2 million users, while it took Facebook Places two months to reach thirty million users. (It would be interesting to know how many of those thirty million actively decided to join Facebook Places or were unwittingly “checked-in” by their friends.)

Instagram, which allows users to post photos from their phone and attach them to Foursquare “check ins,” reached the magic 1 million user number in three months and then doubled that number just six weeks later. A real-time stream of photos from this year’s Grammys was powered by Instagram. There are roughly 5 billion cell phone subscriptions in the world, putting Foursquare’s penetration of the market at .12%

So which apps are mobile users actually downloading?

iOS, the operating system that iPhone runs on, represents 28% of the smartphone market. In January, Apple revealed the top free iOS apps, led by Facebook and followed by Pandora, Google Mobile, Shazam, and Flixster while games dominate the top paid iOS apps. Location based apps like Gowalla, Foursquare, Loopt, and Brightkite failed to make the top 10.

On the Android platform, which has a 27% share of the smartphone market, the Kindle app leads the pack. There are two location based apps in the Android top ten. Layar Reality Browser is an augmented reality app that lets you point your phone’s camera at the world around you and then returns information about it. Places Directory gives you a list of restaurants and other places in the area around you. Neither have the option to “check-in” to places.

So what exactly is compelling people to “check in” at all? Some use these services to get deals. If you “check in” enough times, the merchant will offer the customer a discount. Think of it as a rewards program for all your favorite places in your pocket. My personal experience is that these discounts are few and far between. Only a small percentage of the places I check into seem to offer discounts. Others use it as a way to keep a journal of places they’ve been. Some like sharing what they love about the places.

Are these reasons enough to catch on beyond the tiny percentage of the market they’ve captured so far? Facebook has the best chance to do it, based on their existing user base and the fact they’ve already demonstrated the ability to turn 30 million of them into Places users.

Foursquare is a closed network, allowing you to only share your location with the people you want to broadcast it to. Facebook wants to share your check in with the world, and let your friends share your location too. You’ll be opted into this “feature” before you decide to opt out. I prefer to keep my location limited to friends and family, so I choose to use Foursquare instead.

Digital literacy would allow people to make better choices about how they use these services. Most folks probably don’t know the privacy differences between Foursquare and Facebook Places. Because of this, and the massive user base that Facebook has to tap into, Foursquare has an uphill battle.

Even tougher a battle is getting folks to decide to pull out their phones and “check into” these services to begin with.

That is unless Facebook decides to do it for you.

Photo: A customer holds iPhones she purchased shortly after the phone went on sale with the Verizon Wireless network in Boca RatonFlorida February 10, 2011. Verizon Wireless began selling Apple’s iPhone at long last on Thursday, ending AT&T Inc’s more than three-year stranglehold on the device in the United States. REUTERS/Joe Skipper

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Interesting article!

Location based services (LBS) are hot. However, one big problem is how to provide more value than simply enticing people to check in. There is still a lot of room for innovation.

Here is my pick of Top 10 Cool and Innovative Location-Based Services

http://ericbaker.wordpress.com/2011/03/2 4/top-10-location-based-services/

Posted by EricBaker | Report as abusive