Location-based services slow to catch on in Asia

By Ki Mae Heussner


Those who tout Asia as a leader in mobile telephony should note that not all kinds of mobile applications are gaining traction in the region. While it’s true that some parts of Asia-Pacific are expected to lead the mobile market over the next few years, that growth may not necessarily contribute to the acceptance of certain applications, such as (unfortunately) location-based services.


A recent TNS Global Telecoms Insight study on mobile device usage in the Asia-Pacific region found that, while mobile operators have started to offer a number of GPS and location-based services (LBS), they’re only catching on in a few markets.


Although 53 percent of respondents said they had access to location-based services, only 3 percent said they had used the service. In Japan, location-based services reached 13 percent and in Taiwan LBS reached 10 percent.


The top four features in the Asia-Pacific region were SMS (used by 88 percent of respondents), games (71 percent), cameras (61 percent) and multimedia messaging services (48 percent).


A 2007 report released by research and consulting firm Frost & Sullivan, however, suggested that location-based services in Asia would grow alongside the introduction of mash-up services and an increase in mobile advertising.


The report indicated that the market across 13 Asia-Pacific economies was worth $291.7 million in 2006 and would reach $447 million by the end of 2009.


Japan and Korea, the report said, were the most developed LBS markets, accounting for 92 percent of total revenues in the region.


Demand in other parts of Asia-Pacific has been stifled by privacy concerns, the lack of advanced GPS-enabled handsets, and a lack of an encouraging mobile eco-system and user interest.


Worldwide, though, some analysts project that 2008 will be the year mobile location-based services take off. Research giant Gartner says global subscriptions in LBS are expected to rise by nearly 168 percent this year, driven by increasing numbers of GPS-enabled phones and substantial investments in navigation technologies by heavyweights such as Nokia. Revenue is predicted to jump from $485.1 million in 2007 to $1.3 billion in 2008.


Annette Zimmerman, a research analyst at Gartner, said, “Growth [in location-based services] now will be stimulated by the arrival of mobile phones with built-in, precise location-sensing and the arrival of new service providers, like Google and Nokia, with [their] service offerings, keen to exploit geographic and positioning strategies.”