“LBS is emerging as the benchmark for service differentiation among mobile operators. Despite being a fairly small segment, this niche market is gradually shifting from a mere complementary service into a significant source of revenues,” says Frost & Sullivan industry manager Janice Chong.
Japan and South Korea are by far the most developed LBS markets accounting for nearly 92 percent of the total revenues in Asia-Pacific. Much of this is attributed to the advanced data market in both these countries, the existence of a complete mobile eco-system which is conducive for both application developers and content providers, and the availability of reasonable LBS plans with flat rates.
The demand for LBS in the rest of Asia-Pacific however has been primarily inhibited by various issues including privacy infringement concerns, inter-operability issues, lack of advanced GPS (global positioning system)-enabled handsets, and to a large extent, a general lack of a conducive eco-system and user interest.
In most of these markets, mobile operators’ foremost priority is limited to expanding subscriber base and driving greater data traffic amongst mobile users - offering basic mobile data services which are simpler, provide quicker return-on-investment (ROI), and appeal to a larger target audience.
“However, with wider availability of GPS-enabled handsets, value-added mash-up services and intense advertising, the adoption of LBS throughout the rest of Asia-Pacific is expected to increase,” says Chong.