LBS Social Networking worth $3.3Bn by 2013

ABI Research recently published a report saying that location based social networking could be worth $3.3 Bn globally in another 5 years to come.

While the figure sounds exciting, it also fails to generate that huge an interest among developers to build them owing to effort involving not only the product development but also the tie-ups with major mobile carriersa and the already existing Social Networks.

On the same hand this is another potential opportunity for bigger players like Nokia, Motorola, Mobile Operators etc. to cash upon.

Google has already tried acquiring Meetro earlier and ended up acquiring DodgeBall. Nokia has also showed the sign with the acquisition of Plazes (Berling based startup) in the recent past.

Also the fact that web based social networks, which already have the traffic peaking high on their servers and yet not matured w.r.t. revenue model, can think of LBS opportunity as a good revenue generation thread for them.

ABI Research says, “Location-based mobile social networking revenues will reach $3.3 billion by 2013, but successful business models may differ from what many observers expect“.

“While location-based advertising integrated with sophisticated algorithms holds a lot of promise, the current reality rather points to licensing and revenue-sharing models as the way forward for social networking start-ups to grow their customer base and reach profitability“.

While the above is pretty convincing, how to answer to the following issues at hand:

1. Any LBS service requires the consumer to be tracked which surely leads to the privacy concerns. How to address this issue is still a concern.

2. Data licensing cost is another challenge for the startups. While big players like Navteq and TeleAtlas offer high quality data, the costs on the same hand are superfluous. Other way could be to have a revenue sharing among all the entities like the data vendor, technology startup and the mobile carrier but it just looks like easier said than done.

3. Creating a sufficient brand awareness in the fragmented mass market can hit a startup hard. How many times will I check in on a social network when there are only one or two other friends using it?

Looking at the challenges at hand, it would be very interesting to see GIS startups coming up with location aware application on the already established social networks. If they manage to attract enough eye balls, it could be a good cashing deal on to the highly targeted location-based advertising.

While, whatever any observer says, whatever the current challenges talk, the fact is the location awareness is the strong contender of generation next social netwrorks or to say social network 2.0

Thoughts?

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3 responses to “LBS Social Networking worth $3.3Bn by 2013

  1. Nice Article On Social Networking ! Thank you for keeping up the good work. I look forward to returning to your Social Network space, and learning more about Business Social Networking from you !

  2. Pingback: LBS Social Networking worth $3.3Bn by 2013 ·

  3. Hey guys,

    I am a mobile developer and received an email from Forum Nokia, inviting for a workshop to learn how to create Widgets and more about QT.

    This workshop is on 16th June in Mumbai and we just have two days for registration. So just wanted to know if any one knows more about this workshop or has attended any such workshop before.

    If anyone can share their experiences or thoughts in the same regards?

    The link to their website that I received in the email was: http://www.codeofpartnership.com/agenda.html

    Thanks in advance..

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