By Teri Robinson,
If tiny handheld communicators once seemed a little too Star Trek, consider that in the not too distant future when carriers, content providers, and marketers come calling, they may not just be able to reach you -- they'll know where you are and tailor their pitches accordingly.
While the Internet may promise the highest level of personalization, it's wireless technology, and specifically a broad range of wireless location services and techniques, that will deliver personalization and bring wireless users closer to anytime, anywhere content delivery.
Wireless location technology, such as GPS and Time-Distance Difference to Arrival (TDDA) -- which help companies identify the location of a wireless device within several meters -- is a fast-growing market that research company Strategis Group said will top $3.9 billion in 2004. In fact, industry gurus increasingly view location services as necessary to e-commerce's success.
"A lot of the dreams of e-commerce are not ever going to be fulfilled until location services are up and available," said GartnerGroup analyst Bob Egan.
Egan said traditional companies simply won't be able to deliver custom offers anytime, anywhere without knowing where a user is.
"They're not just going to blast cell carriers with offers," he said.
The demand for location services, while not extensive, is emerging. In a survey of 1,200 consumers by researcher Allied Business Intelligence, 19.3 percent of respondents who had some understanding of third-generation wireless services ranked location services in the top three sought-after services, with 3.5 percent calling it the No. 1 desired service.
"Out of all of the new services, this is one people knew about," said ABI analyst Larry Swasey.
As location services evolve, it's conceivable that a user traveling down the New Jersey Turnpike would be hit with, for example, offers from fast-food restaurants that want to lure him toward the offer of a 99-cent burger two exits away. While that type of tracking seems light years away, Swasey said Bell Atlantic has test-driven location services along the Jersey Turnpike.
Location services also offer retailers an opportunity to dovetail e-commerce and bricks-and-mortar strategies, using wireless technology to drive customers into physical stores. Barnesandnoble.com Inc. (stock: BNBN), for example, supports Palm VII's auto-find feature, which helps users find the location of the three nearest Barnes & Noble stores.
The response delivers information about store hours, telephone numbers and locations, as well as special events such as book readings and signings.
"For the future, we see more integration between the handheld device and the stores, where users will be able to get more robust information through their mobile devices resulting in the ultimate personal shopper," said Robert Albert, director of wireless at Barnesandnoble.com, New York. "The stores could possibly recognize who the customer is as he enters the store and offer something special based on the customer's own interests, or direct the customer to a particular part of the store he might be interested in."
But location services aren't just going to be an important weapon in retailers' arsenals. Movie theaters and restaurants will benefit from pointing the traveler toward their nearest facilities, even letting travelers order tickets and possibly their food online. Banks, too, can steer customers toward the nearest ATM and eventually the branch that offers the particular services they need.
The corporate enterprise, too, will benefit from wireless location services. In the trucking industry, dispatchers will be able to stay in touch with field operatives, directing them to their next appointment, tracking fleets, alerting drivers to weather conditions, or simply making sure they're where they should be on their routes.
Penske Logistics, for example, is affixing positioning devices to trucks to monitor performance.
Location will become more important as IT managers grapple with handling their mobile workers. According to Cahners In-Stat, large companies in the U.S. support approximately 5 million telecommuters. The company notes in a recent report that more than 13 million enterprise users will use wireless phones by year's end. The group said 29 million will be equipped with wireless devices by 2004.
Location services are beginning to be seen on the wireless landscape. Next-generation wireless products like the NeoPoint (sold through Sprint PCS) are starting to emerge with a bevy of bells and whistles. Many now support WAP and sport FM radios and MP3 players. Coming soon is the ability to download audio and video from the Internet.
And U.S. consumers have never been more comfortable with -- or dependent on -- their cell phones. In 1999, the number of cell phone subscribers grew 25 percent, according to the Cellular Telecommunications Industry Association. Figures from an IGI Consulting report indicate that new, smarter phones will proliferate in the years to come. The study predicts that the number of smart phones will grow, 88 percent from 175 million in 2002 to 333 million in 2003.
What's more, wireless location services got an unexpected push from the Federal Communications Commission ruling earlier this year that carriers must be able to determine the location of cellular callers within a few hundred meters so the 911 service could be extended to them. The CTIA said 911 facilities in the United States receive more than 100,000 calls a day from cell phones.
It wasn't such a giant leap from gleaning location information for emergency purposes to using that information for commercial gain, said GartnerGroup analyst Phil Redman. But just how the industry will do it is another matter. A variety of methods for locating cell phones has emerged, but there are so many variables in determining the location of a wireless device that most methods have shortcomings. Vendors such as Cell-Loc Inc., Qualcomm Inc.'s SnapTrack, TruePosition Inc., and U.S. Wireless Corp. (stock: USWC) have all come forward, supporting different wireless location techniques.
Among the most tried and true location methods is having travelers voluntarily enter the zip code of their location. It doesn't require any special equipment or investment, and it certainly allays privacy issues. Lee Hancock, founder and president of location services vendor Go2 Systems, said "ours is completely opt-in."
Users enter their location into a cell phone or wireless device and select the restaurant, movie theatre or facility that they want information about. Still, the problem with this approach is its dependency on the user to provide vendors with the needed information. Even when the user is reliable, he may not be able to provide that information.
GPS, the most widely used location service, uses satellites to track the position of a cell phone, wireless device, or GPS-equipped vehicle. Hailed as the solution for the globe-hopping professional, GPS requires that a wireless device carry a GPS chip, something that's becoming fairly standard in the next generation of handheld devices.
If the line of sight to the satellite is blocked, though, the method is thwarted.
"If you go under a bridge or walk into a building, you have no coverage," Egan said.
GSM networks determine location through two location registers: the Home Location Register and the Visitor Location Register. Through the GSM's Broadcast Control Channel, the cell phone or mobile unit determines that the location area broadcast differs from the one stored in its memory. A new mobile station roaming number is assigned to the device through a Mobile Switching Center, which is the interface between the public and wireless networks.
According to Cahners In-Stat, sales of GSM phones will continue to grow and lead other technologies until 2003, when phones based on GPRS and other technologies will take off.
Radio Camera Technology, or radio fingerprinting, uses the irregularities or unique qualities of radio waves to form fingerprints of the waves. And while they can be highly accurate, the approach assumes that those unique qualities stay the same, though supporters say the fingerprints can be updated frequently.
Triangulation and angle of arrival are also used to pinpoint location. Triangulation uses the signals transmitted from the caller to the two closest listening posts to find the location, the third point of the triangle. Angle of arrival assesses the angle of the signal to determine location, but while it gets high marks in terms of availability, there is an accuracy problem since the listening post must figure out where a caller sits.
Cell-Loc has begun to make a splash with its TDDA approach. First developed by academics to solve the problem of locating people in avalanches, the technology measures the time it takes a signal to arrive at each of three listening posts or base stations closest to the caller, landing within 15 meters, said Lew Turnquist, executive vice president at Cell-Loc, Toronto. The company is busy hawking its technology to U.S. companies, and has begun to sell its service under its new subsidiary, TimesThree.
While location services are coming along, and many of the technical issues are on their way to resolution, a few important issues remain. At the top of the list are concerns about privacy, sure to prompt a heated debate as technology improves. Just because marketers can reach customers no matter where they are, does that mean they should? For many users, having marketers know their location is creepy -- and intrusive.
"Certainly most people would think Big Brother issues here," ABI's Swasey said.
And if they are bombarded with too many offers, Egan said users will revolt, noting that it will become the equivalent of spam. Egan believes, though, that under certain conditions, users will accept spam on their phones if it's relevant and personalized.
Just who should have access to location data is under debate. Some content providers, such as Troy Tyler, president and CEO at SmartRay.com, fear that carriers will hoard the data for themselves, claiming privacy concerns.
But others say in this permissive climate almost anything can be bought or sold.
"There's no way that a bunch of guys interested in eking out profits and revenue [will pass on this opportunity]," Swasey said.
Tyler has strong opinions and concerns about location services.
"One thing that made the Internet flourish so well -- and I'm hoping it will happen here -- is that it's been an open industry," Tyler said. "We need to make sure we don't grant those [rights] to monopolies. It wouldn't be good if the gorillas won by default."
There is some concern that the carriers, which to date have not shown the tremendous interest in location services that Internet startups and content providers have, will hold development back. "The pervasive mindset is whatever potential wireless location services represent, they are controlled by carriers," Turnquist said.
But where there's a will, there's a way. Emerging providers, such as GeePS.com, plan to get around some of the privacy issues by following a permission approach to content delivery. In other words, customers wouldn't be bombarded with special offers or other data unless they request it or include it in their profiles when they sign up.
That's something Go2's Hancock feels strongly about as well.
"When our users search for the closest McDonald's, we assume they want us to know where they are," he said.
Cell-Loc gets past a dependence on carriers by building -- or planning to build -- its own networks.
"We took that assumption that carriers would be in control as our challenge," Turnquist said.
Through its TimesThree subsidiary, Cell-Loc has built a network in Calgary, Alberta, and plans another one in Austin, Texas, this fall. The division will roll out to other U.S. cities and eventually to Europe and elsewhere overseas within two years.
There are other, more typical financial concerns as well. First, the easiest way to locate users would be through phones equipped with location devices like a GPS chip, but that would require users to purchase new equipment.
"To get users to try en masse, you have to be able to say, 'Hey, the device in your pocket lets people send you services,'" Turnquist said.
And new phones, while smarter than the old, are already chock full of new technology, leaving precious little room for location technology. For content providers, money issues are also at the forefront. At the top of the list: Who's going to pay for pushing information out to customers?
Probably the same people who always seem to have the big advertising budgets.
"The 20 percent that do 80 percent of the advertising are going to be the ones that can afford it," Swasey said.
A killer commercial application hasn't emerged yet -- most of the apps that users desire are more mundane and simply not moneymakers. According to the ABI consumer survey, 38.3 percent named e-mail as one of the top three applications they desired to use from their wireless devices; 31 percent listed it as the No. 1 application. And, surprisingly, given all the hype, a mere 2.3 percent want to use their cell phones for Internet access.
What's more, there's still a large portion of the population who simply aren't in tune with the advantages of wireless just yet. "Our survey showed that people really didn't understand third-generation wireless; 42.8 percent didn't know what services they want," Swasey said.
Which means it will be months -- if not years -- before location services are mainstream.
Teri Robinson is a freelance computer journalist based in New York. She can be reached at teri8994@aol.com
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