Notes from Day 3 of MWC-Finding the right (monetisation) strategy for LBS

Barcelona-Day 3 of Mobile World Congress: The 'Finding the Right Strategies for Location Based Services' seminar was all about answering the one key question: 'How does the mobile ecosystem monetise location?'...one year on from this question having been posed at the very same venue, and still no global truth has emerged.

The fact that at this year's seminar, Kurt Lyall from Tom Tom was present is significant. Tom Tom have been one of the few consistent players in the field to successfully monetise location, though not through mobile handsets. Tom Tom's lesson is that customers are willing to pay for (turn-by-turn) navigation and seem willing in the future to pay for search and other location services.

Olivier Laury from Bouygues Telecom was in a difficult spot on the panel: as an operator, he had to defend the punitive charges from roaming when using LBS, a clear brake on further market development. His defence of 'I'll lower my tariffs if my operator counterparty lowers his' is clearly unacceptable, with EU policy likely to continue rigorously attacking operators profit skimming on subscriber roaming.

Charles Morse from Garmin discussed the case of a company they own, Digital Cyclone, that delivers weather reports on their devices in a compelling way and has been very successful. Similiar successful examples of Location-related content whose intrinsic value justfies premium charging included ViaMichelin and Lonely Planet travel content.

The overall lesson? Ultimately the customer must be allowed to choose. Great content will attract customers more than anything else and a revenue model that is likely to work will offer a free basic service supported by ads or a premium ad-free service. The two models can also be combined:in Bouygues Telecom's experience, cross-over rates from basic subscribers to premium are as high as 15%.

uLocate announces deal with Garmin for Buddy Beacon

BOSTON-In line with a trend that has been developing this year, uLocate (well-known for its WHERE platform) is the latest LBS company to announce a deal with a device manufacturer. Today, the company has released a note stating that they will integrate their Buddy Beacon application into Garmin's connected devices and their Mobile XT Platform.

The full press release is as follows:

" August 19, 2008—uLocate Communications, the world’s leading developer of location enabled applications, announces an agreement with Garmin to add friend-finding capabilities to select current and future Garmin GPS devices. The partnership leverages APIs on uLocate’s WHERE™ platform to enable Garmin users to easily find and connect with friends nearby through the leading friend finding network, Buddy Beacon.

“The team over at uLocate continues to drive innovation with their open WHERE platform, enabling the broadest set of location based applications across the largest distribution network in wireless,” said Jeff Rath, vice president, global head of technology research of Canaccord Adams. “This represents a powerful combination – the largest PND manufacturer and the dominant platform in the market bringing together the universe of location enabled connected devices.”

With access to WHERE’s Buddy Beacon network, Garmin customers will be able to connect with their friends, share their location and update their status across a variety of online social networking sites including Facebook. Unlike other friend-finding applications, WHERE’s Buddy Beacon operates seamlessly across multiple networks, making it possible to connect with friends regardless of phone or carrier.

“We are delighted to team up with Garmin and through our WHERE platform, provide their users with access to Buddy Beacon,” said Walt Doyle, CEO of uLocate Communications. “The partnership connects two leaders in their industries that are committed to offering customers new and exciting interfaces."

Expect other companies in the LBS scene to come out with further announcements in the coming months, as new distribution and monetization models come to the fore.