Subject: [NEXTEL-1] Can geo-location services find the way?

From: Marcel <[email-masked]>
Date: Wed, 12 Mar 2003 09:26:55 -0500

Can geo-location services find the way?

March 10, 2003 7:54am

Mass market geo-location services appear to be just around the corner for U.S. consumers,
offering
much-needed revenues for wireless carriers. But they could still get lost along the way.
Car rental agency
Avis this month started selling a service called Avis Assist that lets lost customers
learn where they are,
then get back on track with turn-by-turn directions read to them over a cell phone. Others
undertaking big
new geo-location initiatives include Nextel Communications, which recently began selling a
new service
that pinpoints phones and shows the "bread crumbs," any number of places a cell phone's
been in the last
few hours. Later this year comes perhaps the biggest commercial rollout yet, when a major
U.S. telephone
company will launch a cell phone 411 service that provides your location, said Joe
Astroth, vice president of
Autodesk's location products. The entry of big telecommunications carriers into
geo-location services
promises big changes for a largely niche industry that currently generates about $100
million in yearly
revenues retrieving lost trucks and helping parents keep track of their children. But
there's a significant
problem just as the wireless carriers are finally expressing interest in testing the mass
consumer waters:
location-ready handsets are in short supply and cellular networks aren't ready yet to
support very many
customers. That could force delays, and ultimately, changes in carrier plans, observers
believe. "For the
consumer, it'll be five years before location is in a lot of people's lives," said Timothy
Neher, CEO of Wherify
Wireless, which makes child location bracelets. Avis' new geo-location service is a good
example of both
the promise and problems of these wireless services. There are millions of Avis customers,
and most have
cell phones. But the chances are very slim that those phones are loaded with the right
software to take part
in the new service. So at this stage of the game, Avis is renting out Motorola
location-enabled phones for
customers interested in the service. Like those of its competitors Nokia and Ericsson,
Motorola's line-up of
cell phones includes only a few location-enabled models. Speaking generally, David Rudd, a
Motorola
representative, said wireless network equipment makers and handset providers must
experience a demand
before committing to making large quantities. "Avis is the first time we're seeing a lot
of commercial
interest," Rudd said. "Everyone will eventually find use for some location services. It's
a great shortcut. But
we don't quite know how to do it yet." Carriers are also not very focused on offering
these services
commercially yet, said IDC analyst Dana Thorat. Instead, they are scrambling to meet the
Federal
Communications Commission's 2005 deadline for installing technology that lets emergency
workers locate
cell phones that have been used to call 911, something that's already possible with
landline phones. Selling
location services is taking a backseat to avoiding millions in fines for failing to meet
the FCC mandate,
Thorat said. Where are the handsets? It's difficult to assess how many location capable
handsets are in the
U.S. cell phone market now, but there likely aren't very many. Qualcomm says it has sold
about 10 million
location-enabled handsets worldwide. The company would not break out regional sales, but
analysts believe
most have been distributed in Asia, where an eager audience uses any of 100 different
location services.
"That doesn't leave very many for the United States," said Joe Laszlo, a wireless analyst
with Jupiter
Research. Qualcomm's location technology uses a mixture of satellites, cell phone network
base stations
and handsets. The phones, known as A-GPS (assisted global positioning service) phones,
have radios so
that orbiting satellites can locate them and determine a latitude and longitude. Cell
phone networks help
out, providing the location of a base station the phone is using. These bits and bytes get
worked over by
data centers, where maps, driving directions or other services are created. Wireless
carriers AT&T
Wireless, T-Mobile USA and Cingular Wireless use a location system created by Cambridge
Positioning
System. It's less expensive than GPS because only new handsets are needed. Carriers don't
need to make
adjustments to their networks. A CPS representative did not release the number of handsets
on the market
with its software inside. But it's likely there aren't very many, if any, in the United
States. AT&T Wireless
and Cingular Wireless had been testing CPS handsets but switched to a new location
technology relatively
recently. T-Mobile USA is still sticking with the CPS software, saying it's had more
success in testing than
did AT&T Wireless and Cingular Wireless. A T-Mobile representative has repeatedly refused
to disclose the
number of handsets its customers now have. The brutal economic climate is also hampering
another major
piece of the location market: cell phone networks. Wireless execs say it's forcing
carriers to focus more on
selling voice calls, which is what makes them money. "Carriers are really trying to sell
(voice calls) right
now, that's what's going to really keep them alive," Wherify's Neher said. "They're
sticking to their core
competencies." But still, a few carriers are dipping toes in the water. AT&T Wireless
sells a dating service
using Match.com and location technology. AT&T Wireless determines a phone's position using
the location
of the nearest base station, an area that encompasses entire zip codes. The search engine
will never reveal
actual physical locations, but simply lets customers chat only with matches within a
specified radius,
according to Match.com. Nextel Communications is expected to unveil a location service on
Tuesday that
uses GPS phones. Nextel's 10 million customers are almost exclusively business people,
meaning any
location service will likely be tailored in that direction. It'll happen--in 2007 IDC's
Thorat believes once the
handsets are available, and the cell networks readied, the market will eventually develop.
By 2006, about 52
million people will be using Avis Assist and other commercial products, generating $2.7
billion in the United
States, Thorat said. But in another sign of handset and network availability problems, she
said that in 2002,
there was virtually no revenue from consumers using location services. Autodesk's Astroth
doesn't paint as
gloomy a picture. He said most wireless carriers will be augmenting 411 services with
location applications
sooner rather than later. For a sneak peak, go to Italy, where, since October, mobile
carrier Telecom Italia
Mobile began selling a "panic button" service, Astroth said. Enter the appropriate keypad
combination, and
a voice on the other end will offer things like travel directions, the nearest hospital or
other location-related
items, he said. "I don't believe we have to wait five years," Astroth said. "2003 will be
the year of deal
making and deployment."

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