Voice and data services have become commodities for telecommunications companies.  The result is an industry hungry for innovation to increase customer base and profit margins.

According to TeleMapics, location-based service (LBS), utilizing wireless communications and global position technologies, is poised to be that innovation.

LBS is an old term largely dismissed by industry insiders as it was uveiled almost a decade ago with huge amounts of hype and zero follow-through.  However, today is another story.  LBS could very well be the defining technology of 2008, as I have posted before.

AT&T and the iPhone are the kings of LBS at the moment, but Sprint just announced they are teaming up with Microsoft.  Verizon is not far behind.

If this is the case, marketers have some work in front of them in figuring out how to leverage LBS for their respective clients.

Here is what I/we know so far:

1. Utility Beats Entertainment…For Now 

For all the hoopla we’ve seen about being about being able to watch YouTube videos on iPhones, it turns out people are not as interested in surfing as they are searching.  Adrian from Zeus Jones writes today about an interesting finding from Google.  It turns out Google Maps usage has “increased sharply” since the release of the iPhone and “hasn’t stopped rising.”  Meanwhile, YouTube availability on the iPhone has not effected usage at all. 

Adrian analyzes this, stating “There’s no denying that entertainment is a legitimate way to engage, however this [information] does prove that the barrier to entry for a good entertainment experience is substantially higher than it is for a useful service.”

What does this mean for marketers?  Well, in a nutshell, focus on building mobile utility for your customers if you hope to get the greatest return.  Table the mobile entertainment unless you have some creativity worth a pencil - this may break through the barrier Adrian mentions above.  Or, optimally, pair the two together…just don’t forget the utility.

2. The Battle for Ad Turf

The mobile advertising space is basically virgin territory, but already people are working to carve out space and build standards for mobile marketing.  The “people” are search engines, carriers, and new platforms.

Search Engines: Google AdSense for Mobile enables online publishers to target location-based advertising to anyone using their browser from a mobile phone.  The opportunities here are endless from a marketing perspective, but they are limited at the moment.  Currently, Google only offers AdSense for Mobile on basic text ads. 

Carriers: Another player vying for space is Australian telco Telstra.  Per ITWire, Telstra has “launched a trial of location based coupons from major retailers such as KFC and Pizza Hut. In the trial, users can request a coupon to be sent to their mobile phone from banner ads on a variety of websites.

By clicking on the banner advertisements, consumers are provided with information on the promotional offer and the ability to enter their mobile number to receive a coupon via SMS. For Telstra mobile customers, information on their mobile also includes a map of their local area and the location of the nearest stores plotted on the map.”

New Platforms: ProximityMedia has built out a system that can push out relative content to Bluetooth phones.  Their demo is tacky but interesting:

3. LBS = SMS + MMS + WAP

Wonky?  Yes.  Let me explain.

SMS - A.K.A., Short Message Service - A.K.A., text messaging - can easily be sponsored by corporations.  Envision an ad on top of your text message.  In turn, you can text for free.  Lots of marketers like this idea because it seems so darned simple.

Well, LogicaCMGrecently did a study of consumer reactions to sponsored SMS (or SMS Advertising) and discovered that Northern Europe and the U.S. would be “extremely unlikely” to use the product.  The conclusion here is free SMS isn’t that important in America - after all, unsponsored SMS is only five bucks a month.

However, SMS advertising has shown success when it is paired with multimedia messaging service (MMS) and wireless application protocol (WAP).  For all you non-wonks (a group that includes me), a good example of MMS is any mobile message that includes images, videos or music, and WAP is basically a phone that can connect to the Internet.  Put all three together, and you get yourself a promo.

For instance, a radio station in Boca Raton, FL, recently teamed up with LOC-AID (a LBS technology provider) to build out a scavenger hunt called Dash for Cash.  In it, people got SMS, MMS, and had to use WAP to find clues that would lead to $10k in booty. Supposedly the thing was a hit.  You can see more here:

4. LBS doesn’t have to sit on your phone

We have all seen the LBS billboards in Minority Report.  Tom Cruise walks by a board that customizes to his presence.

Well, we aren’t there yet, but AKQA recently got us closer.  This time last year, they built out a billboard campaign for Yell.com that was placed on the sides of London buses.  The billboards were linked to GPS that enabled them to be customized as they were on route.  Interactive, local maps were also put in at bus shelters.  Killer.  And they didn’t even use a phone.

More later from me.  Anyone else have a best practice/insight for using effectively using LBS in marketing/advertising?

2006 was the year of connecting.  Some call it social networking. Time named it You.

2007 is the year of conversing.  Some call it consumer-generation.  Others like the term co-creation.  Wired named it crowdsourcing.

2008 will be the year of circulating.  Some call it mobile marketing.  Others refer to it as location-based (LB) services, media and/or marketing.  It currently lacks a fancy name.

Circulation - literally meaning free movement or passage through a system - has been on the minds of marketers and media for quite some time.  Today, we call our efforts ”mobile content”, and some of us have shown investing in the mobile infrastructure can pay off.  However, because the current infrastructure has so many limitations, greate examples of mobile content still elude us. 

But 2008 will see mobile devices come into their own.  The technology being unveiled today will start to impact how everyday people choose which company (and brand) to patron tomorrow.

Everyone’s favorite example of this is the iPhone.  It has a mishmash of applications that make it more of a mobile computer than phone.  People can seek out coffee shops using Google maps and GPS synchronization.  The opportunities for Starbucks to get in the middle of this are endless.  And they will…in 2008.

But the iPhone is just a piece of a larger puzzle still being put together.  Other parts include geo-positioning devices in cars, RFID tags embedded in products and places (and people), the further expansion of WiFi, mobile media access, mobile barcode recognition, and all the related applications and services that come with it. 

Combined, they allow us to take our social networks and desires to co-create to the streets.  We will commune, we will converse, and we will do it without constraint.

Examples of Location-Based Services/Media

Mobile Touring by Ubilabs

MobileTouring is an authoring tool for tours. Anybody (you, your company, a city’s convention/visitor’s bureau, etc.) can set points of interest online and enrich them with a photo and short text information. In turn, anyone that has the system uploaded on their mobile phone can create customized tour specific to their needs.  No more dirty headsets at museums.  No need for three+ travel books fore each city you visit.

Bar Code Scanners by NeoMedia

Scanner:                                                      Phone with Code:

Neomedia has deployed mobile phone scanners at concerts around Europe. Fans and concert goers purchase electronic tickets over the Internet and instantly receive a text message containing a two dimensional code (Data Matrix or 2D) on their mobile phone. The code can easily be scanned at the concert’s point of entry by mobile scanners for immediate event access. In doing so, NeoMedia demonstrates the use of optically processed mobile codes for real-world financial transactions.

Explorer v3 by Node

The Node Explorer is a small handheld computer with stereo headphones which is connected to a central server.  The Explorer’s integrated GPS location sensor is able to pinpoint the exact location of its user, triggering images (still and video) and broadcast sound and video, in a targeted format (e.g., content can be customized by language, age group, particular interests, special needs, etc.)

Examples of Location-Based Marketing

Got any?  I’m sure all of us will next year.