Google’s Trojan Horse (or Why Location Based Services are not a Business)

http://www.mobileindustryreview.com/2009/02/latitude_the_trojan_horse_--_why_whos_nearby_is_not_a_business.html

by spif • 17 years ago

25 25 17 years ago

ajkirwin• 17 years ago

I call bullshit. This entire article reads like someone being pissed because they tried and failed.

ivey• 17 years ago

I thought it was really even handed, and good advice. Lots of people have tried and failed: few step back, figure out why, and offer advice to everyone coming after them.

alabut• 17 years ago

A big assumption underlying the article is that Google's Latitude will take off - that's definitely not a given. Just because it's made by Google and free isn't necessarily enough to overcome switching costs, a lot of people have their location-based network built up in Brightkite, Loopt, etc.

spif• 17 years ago

Google's sheer mass and "better" integration with their own products puts it in a good position though.

c00p3r• 17 years ago

The maps is the matter. When you're riding a train between Gaya and Varanasi and see you location it real-time on old Nokia phone - it is amazing.

briansmith• 17 years ago

I agree 100% with this article. Keeping track of your location will be a commodity very soon.

In one or two years, there will be open standards for sending your location to the person your talking to, sending it to a contact, and broadcasting it. Handset vendors will implement those standards. If they are nice they will provide API hooks to let application act on the sending/reception of location information. The same thing will happen with status messages (Twitter and Facebook) and other activity streaming stuff.

It could happen a lot faster if carriers built these protocols on top of text messaging (probably using a special kind of service message) to drive further adoption of unlimited messaging packages.

The business model is clear. The mobile phone operators will implement it so you have an incentive to buy the next generation of phones. The carriers will implement it because adding the feature to your phone bill is basically free money for them. Users will pay for it because they are used to paying for phones and phone services, and because it is more convenient than dealing with all these social networking plays.

Independent social networks won't make any money because tiny classified ads don't work in social networking, and besides location-based advertising will be bundled into the user's mapping/searching software (Google Maps Mobile, Nokia Maps, and similar). Users won't pay directly for social networking because traditionally it has always been free.

calambrac7• 17 years ago

Location-based services are a business, but the consumer holding the mobile isn't who you should expect to pay. Instead, get off your lazy programmer ass and start pounding the pavement, getting local businesses to sign up and pay for access to your awesome location-aware ad network, and then give the consumers the amazing value of being able to ask not just "Where can I go to grab coffee?", but "What restaurant has open seats right now?", "Who's offering discounts to get rid of their pastries instead of tossing them at the end of the day?", "I need to buy a box of Cheerios, any local grocery stores want to bid on my business?", etc.

Location-based is the future of business. I wonder if this guy sees it and is trying to drive away the competition, or if he took his one flawed pass at a business model and gave up. Either way, he's full of shit.

lhorie5• 17 years ago

>> Location-based is the future of business. I wonder if this guy sees it and is trying to drive away the competition, or if he took his one flawed pass at a business model and gave up. Either way, he's full of shit.

Are you doing this successfully? If not, I'll take the word of someone who's been there over the word of someone predicting the future.

calambrac7• 17 years ago

He's been there with a model that failed. He talks in great length about why that model sucks, and then draws the conclusion that the whole space is doomed. Why is that more convincing?

volida4• 17 years ago

From what you say it's obvious you didn't read the article or you didn't care to understand it.

Others, why are you upvoting him?

calambrac7• 17 years ago

What are you talking about? He keeps complaining that "Where are my friends?" won't make money, and ignores the questions "Where are my customers?" and "What can I spend money on near me?" What, exactly, am I misunderstanding?

Generally, instead of complaining about how people are voting, it's more productive to say why you disagree. It's not like I just spit out a pointless troll, I addressed the substance of the article and said why I disagreed. If that rubs you the wrong way, or you think I missed something, say why or actually take the time to enunciate what I got wrong. Otherwise, please stfu.

srn• 17 years ago

Part of this guy's argument is bogus. It is basically "Someone big is going to do this so why bother." That could be said of 99.99% of all businesses. "IBM is so big, why bother with Microsoft?"

Part of the problem with any business with a localization aspect is that it takes more people to get buyin. Yelp in the bay area? Fabulous. Yelp in Louisiana? Not so great. Same goes for meetup.com, where I can find people in my area, as compared to plazes, where there was maybe 1 other person near me.

Yes, people probably won't pay for services who tell them where their current friends are, but there's still value. I personally would be interested in knowing where my "facebook friends" are - for me that's people who I am acquainted with but necessarily socialize with unless it's convenient, like if I'm shopping and want to go see a movie in 10 minutes. Random people who might be interesting are also a way to pass the time if I'm bored waiting for a train.

martian• 17 years ago

My impression of the article is that the author was saying it's difficult to get into business selling only what or who is nearby, since both of those are close to becoming (if they're not already) commodities. The trick with location-based services is to provide novel interaction or functionality or customization on top of these commodities. Quoting the OP: "As a LBS start-up, you need to think about adding distinctive value for users; differentiating on location is an oxymoron."

There are plenty of companies who will be hugely successful in the LBS space. Maybe Google, maybe Loopt, maybe Brightkite or Yahoo or CloudMade... If you think you can be the next company to track where everyone and everything is (massive infrastructure requirements!) -- this article is suggesting you are probably on the wrong track.

(side note: Yahoo's FireEagle is also something to watch in this space, as are the recently launched developer products from CloudMade.)

Google’s Trojan Horse (or Why Location Based Services are not a Business)

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