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IEMR’s United States Location Based Services (LBS) Forecast provides five-year annual forecasts of LBS users, ARPU, total spend and other metrics going out to 2013. We provide forecasts for the following categories within the LBS market: Voice-Guided In-Car Navigation, Voice-Guided Pedestrian Navigation, Mobile Maps, Mobile Maps Applications (weather, restaurant guides, traffic, etc.), People Tracking, Location Enabled Search and Advertising, and Other LBS Applications (e.g. Proximity-based actuation, Proximity-based notification, etc.)  

Our LBS market forecasts are based on our proprietary, country-specific forecasting models. These models deploy multiple regression analysis and cross-impact matrices that estimate relationships between subscriber data, technology use and deployment data, overall economic and demographic changes expected in a particular country or a particular region.

To this comprehensive dataset, we are adding a PowerPoint presentation which provides our clients with an overview of key trends in the global LBS industry. In addition to explaining overall trends in the global LBS and GPS markets, we discuss the potential of Location Enabled Search and Advertising industry in many regional markets around the world over the next several years.

This report will be useful to:

·         Location Based Service providers

·         Strategists and analysts at vendors responsible for LBS strategy development and business analytics

·         Handset and device manufacturers in all areas of the telecommunications market that need strategy recommendations on key trends in the global mobile handset industry

·         Financial analysts and portfolio managers covering firms in the LBS industry or the mobile handset industry

·         Consultants advising their clients on LBS markets

·         Researchers who need to gain a better understanding of the global LBS market

Executive Summary

Global market for consumer-centric LBS to rise to $7.85 billion in 2013, a CAGR of 57.8%

While growth in the LBS market has not been spectacular in the past, we think that the increasing availability of GPS handsets in the next five years will help accelerate adoption for LBS across the world

•  In the last year, out of 870 model launches, 287 handsets (or 33%) had GPS capability. We think that this ratio will likely rise to 45% - 50% of handsets by 2013, resulting in greater ubiquity of LBS.
•  We are forecasting a total addressable global market for consumer-centric LBS to rise by a CAGR of 57.8% to $7.85 billion in 2013, from $1.27 billion in 2009.

Location Enabled Search and Advertising will see the biggest growth , growing at a CAGR of 260% over the next five years

While Voice-guided In-Car Navigation will continue to be the main use for consumer-centric LBS applications in the next 2-3 years, we think that Location Enabled Search and Advertising will see big take-up from 2010 onward

•  Globally, we think that Location Enabled Search and Advertising will see total spend rise from $20 million in 2008 to $3.4 billion in 2013, making it the fastest growing segment in the LBS market place.
•  We think that by 2013, there will be 706 million unique users of Location Enabled Search and Advertising with 8.6 billion click thrus.
•  Globally, we are forecasting that Cost per Click to advertisers will decline only marginally over the next five years from 42¢ in 2009 to 39¢ in 2013.

The future of LBS is in Location Enabled Search and Advertising

Location enabled searches are becoming increasingly popular:

•  Our channel checks with leading service providers suggest that a larger proportion of mobile searches are conducted through local searches or point of interest applications.
•  Our channel checks also suggest that web-based search applications such as Google Maps and Yahoo OneSearch are getting better traction in the mobile space.
•  Our analysis of click thru rates for mobile advertising support our assumption that click thrus are going to see a major upswing in the 2010 – 2011 period.

Voice Guided In Car Navigation users will rise to 47.3 million users in 2013

We are expecting total spend on Voice Guided In Car Navigation to rise to $2.6 billion in 2013

•  In our view, a number of factors are driving the adoption of handset-based navigation in cars. These include:
  •  Pre-installed GPS navigation in vehicles in North American and European markets.
  •  Flexible pricing models such as monthly, weekly and per route subscriptions.
  •  Increasing convergence of devices for use both in the car and outside it.
•  As in all technologies, we are forecasting that monthly ARPUs for Voice Guided In Car Navigation services will drop from $5.87 in 2009 to $4.59 in 2013.
•  Our surveys show that ARPUs for Voice Guided In Car Navigation is more sticky than other LBS services (such as maps and map applications), primarily because individuals likely to install these devices in their cars are not as price sensitive as the overall population.   

Regional Overview

North American consumer-centric LBS market to rise to $2.7 billion in 2013, a CAGR of 40.5%

North America (Canada and United States) will account for 34.3% of the world market share for consumer-centric LBS spend

•  We see the biggest growth coming from Location Enabled Search and Advertising in the North American market. Total spend in this category will rise in North America at a CAGR of 284% to reach $1.17 billion by 2013.
•  Voice Guided In Car Navigation has a high level of penetration in North America with 6.2 million users expected in 2009. This accounts for 42% of global users. We expect that in 2013, there will be 15.1 million users of Voice Guided In Car Navigation, accounting for 32% of global users of such services.
•  Canada will see 58.1% CAGR in LBS spending over the next five years with a market valued at $121 million in 2013.
•  The United States will still be the largest single market for LBS in the world with a growth rate of 39.3% CAGR over the next five years. We expect the US market to be valued at $2.6 billion in 2013.  

South and Central America consumer-centric LBS market to rise to $213 million in 2013, a CAGR of 68.2%

South and Central America will account for 2.7% of the world market share for consumer-centric LBS spend

•  Although total spend in Location Enabled Search and Advertising in the South and Central American market will grow rapidly over the next several years, it will continue to be small compared to other categories. Total spend in this category in the region will rise from $0.07 million in 2009 to $4.47 million in 2013.
•  The category with the highest total spend in South and Central America is People Tracking. We expect that People Tracking Users in the region will increase from 4.4 million in 2009 to 54.4 million in 2013.
•  Brazil, the largest market in the region,  will see 68.4% CAGR in LBS spending over the next five years with a market valued at $102 million in 2013.
•  The second largest market in the region will be Mexico with a growth rate of 70.6% CAGR over the next five years. We expect the Mexican LBS market to be valued at $61.7 million in 2013.  

Western Europe consumer-centric LBS market to rise to $2.97 billion in 2013, a CAGR of 96.4%

Western Europe will account for 37.9% of the world market share for consumer-centric LBS spend

•  We see the biggest growth coming from Location Enabled Search and Advertising in the Western European market. Total spend in this category in the region will rise at a CAGR of 301.4% to reach $1.32 billion by 2013.
•  Users of Voice Guided In Car Navigation in Western Europe will increase to 10.1 million in 2013, for a CAGR of 64.2%. Total spend in this category will reach $638 million in 2013.
•  France will be the largest market in the region with its LBS market valued at $573 million in 2013 (with a CAGR of 80.9% over the next five years). In France, People Tracking will continue to be the largest category with spending of $315 million in 2013.
•  Total spend in Germany’s LBS market will be $487 million while total spend in the U.K. LBS market will be $406 million.

Eastern Europe consumer-centric LBS market to rise to $180 million in 2013, a CAGR of 86.4%

Eastern Europe will account for 2.3% of the world market share for consumer-centric LBS spend

•  The category with the largest total spend in Eastern Europe will continue to be Voice-Guided In-Car Navigation. We expect that there will be 2.3 million users of Voice-Guided In-Car Navigation in Eastern Europe in 2013, and the market is valued at $96.4 million in 2013.
•  However, the biggest growth will come from Location Enabled Search and Advertising in the Eastern European market. Total spend in this category will rise at a CAGR of 630.8% to reach $20.3 million by 2013.
•  Poland will see 91.0% CAGR in LBS spending over the next five years with a market valued at $42.5 million in 2013.
•  Russia will be the largest market for LBS in the region with a growth rate of 84.4% CAGR over the next five years. We expect the Russian market to be valued at $88 million in 2013.  

Asia-Pacific consumer-centric LBS market to rise to $1.66 billion in 2013, a CAGR of 50.5%

Asia-Pacific will account for 21.2% of the world market share for consumer-centric LBS spend

•  The highest growth will come from Location Enabled Search and Advertising in the Asia-Pacific market. Total spend in this category will rise at a CAGR of 207.2% to reach $866 million by 2013, replacing Voice-Guided In-Car Navigation as the largest category in the regional LBS market.
•  We expect that users of Voice-Guided In-Car Navigation will increase from 6.76 million in 2009 to 17.4 million in 2013. Total spend in this category will reach 560 million in 2013.
•  The largest LBS market in Asia-Pacific is Japan with an estimated total spend of $1.01 billion in 2013 (CAGR of 44.0%). The largest category will continue to be Voice-Guided In-Car Navigation in Japan with $58.6 million in spending in 2013.
• China will see 76.2% CAGR in LBS spending over the next five years with a market valued at $115.9 million in 2013. Also, total spend in India’s LBS market will rise to $78.2 million in 2013.

Middle East and Africa consumer-centric LBS market to rise to $124 million in 2013, a CAGR of 88.3%

Middle East and Africa will account for 1.6% of the world market share for consumer-centric LBS spend

•  The LBS market in Middle East and Africa will grow rapidly over the next several years. In terms of categories within the market, the largest one will continue to be Voice-guided In-Car Navigation, with an estimated total spend of $45.1 million in 2013.
•  We expect that users of Mobile Maps in Middle East and Africa will increase at a growth rate of 65.6% CAGR over the next five years to reach 22 million in 2013.
•  Turkey, the largest market for LBS in the region, will have total spend of $40.2 million in 2013 (CAGR of 88.5% over the next five years).
•  Total spend in South Africa’s LBS market will be $33.8 million while total spend in Egypt’s LBS market will be $18.7 million by the end of 2013.

Table of Contents

Forecasts for 2009 - 2013