Location-based Services

LOCATION-BASED SERVICESINDUSTRIAL AND BUSINESS ANALYSIS

Group 6Huanhuan WANG Bo WANG Xinwei YANG Han LIU

Telecommunication Management F2011

OBJECTIVES

What is Location-based services (LBS)?

What is the impact of Location-based services?

What is the most viable business model in LBS?

Ultimate QuestionHow should we create our own LBS Business?

OUTLINEI. IntroductionII. Industrial AnalysisIII. Business Evaluation ModelIV. Implementation of Model

V. Comparison & Evaluation

ComparisonImplementationEvaluation ModelIndustrial AnalysisIntroduction

INTRODUCTION OF LBSDefinition: Information services provided to mobile devices through mobile networks, which may utilize the location information to various value-adding services.

Core Components:


Hardware & Infrastructure:

• Mobile Devices• Positioning

Component

Software & Services

• Service & Application Providers

• Data & Content Providers

Networking Environment

• Communication Network

INDUSTRIAL ANALYSIS

Type of LBSBusiness

ModelInformation

UsedExamples

Authorities and corporate applications B2B Location data,

Aggregated data

Surveillance, Network control,

Asset management

Location information B2C Client location data

Maps, Navigation, Traffic

Personalization B2CClient location

data and profiles data

Promotions, Coupons, Social

contact


Application of Location-Based Services

INDUSTRIAL ANALYSIS


Timeline of Location-Based Services in US

INDUSTRIAL ANALYSISImpact to the Industry


Social Networking

• Real-time Social Networking

• Physical Participation

• New Channel for Profit Making

MobileCustomer Demand

Eg, Location sharing

Software DesignEg, Data Mining

Hardware Capabilitie

sEg, iPhone

INDUSTRIAL ANALYSISConcerns & Challenges

Technical• No single standard• Lack of hardware & software support

Social• User privacy• No specific legal policies


BUSINESS EVALUATION MODEL

ComparisonImplementationEvaluation ModelIntroduction Industrial Analysis

Service Contents

Profit Model

Ease of implementation

Organizational Capabilities

Positioning

Risk Evaluation

► Value Proposition: Value generation► Opportunity Size: User bases,

Social/behavioral impacts of services,

► Revenue Generation ► Cost Structure► Sustainability & Growth

► Technical, Financial► Internal, External (Partners)► Competition ► Substitutes► New entrants

► IPR, Privacy, Regulations, Industry Trend

= Business Models + LBS Features + Investment Evaluations

YELP

ComparisonImplementationIntroduction Industrial Analysis

Service Contents

Profit Model



Positioning

Risk Evaluation

► Values: Visitors & Reviewers (Yelpers) , Business Owners, Paying Advertisers

► 61 Million Visitors/1 Million Reviews Per Month

► Revenue: Local Subscription, Advertisements, Daily Deals (30% Charge)

► Cost Structure: R&D, Operating Expenses, Sales & Marketing

► Growth: Filed IPO in Nov 2011

► GPS, Wifi, Transmitter positioning

► Competitors: Google Places, CitySearch, etc► Differentiation: Well-established Social Networking + Diversified Platform Support

► Legal Risks: Manipulating Results► Security Risks: Mobiles► Partnership: Half of Flow from Google

Evaluation Model

YELP


Service Contents

Profit Model



Positioning

Risk Evaluation

► Values: Visitors & Reviewers (Yelpers) , Business Owners, Paying Advertisers

► 61 Million Visitors/1 Million Reviews Per Month

► Revenue: Location Subscription, Advertisements, Daily Deals (30% Charge)

► Cost Structure: R&D, Operating Expenses, Sales & Marketing

► Growth: Filed IPO in Nov 2011

► GPS, Wifi, Transmitter positioning

► Competitors: Google Places, CitySearch, etc► Differentiation: Well-established Social Networking + Diversified Platform Support

► Legal Risks: Manipulating Results► Security Risks: Mobiles► Partnership: Half of Flow from Google

Evaluation Model

FOURSQUARE


Service Contents

Profit Model



Positioning

Risk Evaluation

► Value: “Check In” Promote Business Development► 1 Million Registered Users / 3 Million Check-ins

per day for the 2-Year-Old

► Revenue: No Solid Model (Exploration & Accumulation Phase)

► Competitors: LBS, Social Networking Providers► Differentiation: LBS + Social Networking

► Privacy: Automatic posts / Position displays► Regulation: IRP issues

Evaluation Model

GOOGLE LATITUDE


Service Contents

Profit Model



Positioning

Risk Evaluation

► Value: Location Sharing, Supplementary Product► 3 Million Users / > 50% Inactive

► Revenue: No Direct Source, Funded by Google ► Growth: “Succeeded” by Google Place

► Previous incompatibility with iphone

► Competitors: Foursquare, Facebook Deals (Gowalla)

► Privacy: Many procedures to protect privacy Optional Check-in + False Display + History Management

Evaluation Model

COMPARISON & EVALUATION


Service Contents

Profit Model



Positioning

Risk Evaluation

Users + Business + AdvertisersYelp• Information facilitation• Less value-adding from Yelp

Users + BusinessFoursquare• Entertaining social network• Value-adding through data mining

Users Latitude• Location sharing among users• Limited value adding

Customer Base



Service Contents

Profit Model



Positioning

Risk Evaluation

Advertising + Subscription + DealsYelp• Location specific selling• Subscriptions: Value adding for Business• Deals: Location-based + Daily

Advertising + Location-based DealsFoursquare• Immature profit model

Advertising (Google)Latitude• Indirect revenue generation

Revenue Generation



Service Contents

Profit Model



Positioning

Risk Evaluation

OE + Sales & MarketingYelp

Operating ExpenseFoursquare

Operating ExpenseLatitude• Utilized by Google package

Cost Structure



Service Contents

Profit Model



Positioning

Risk Evaluation

To-be-listed Dominator in the FieldYelp

New Growing OrganizationFoursquare

Comprehensive Services from GoogleLatitude• Google Place• Google +




Service Contents

Profit Model



Positioning

Risk Evaluation

Giants entering new domainsYelp• Google Offers, Facebook Places

Both LBS & Social Network ProvidersFoursquare• Leading position in the field• Unique differentiation

Supported by GoogleLatitude• No financial pressure• Comprehensive packages by Google

Competition



Service Contents

Profit Model



Positioning

Risk Evaluation

Biased Services + Privacy ConcernsYelp• Sued by subscribers

IRP + Privacy ConcernsFoursquare• Lack of specific regulations in LBS privacy protection

Privacy ConcernsLatitude• Privacy vs. Quality of Services

Legal Concerns

CONCLUSION


Service Contents: Integration of LBS with other services + Utilize the data

Profit Model: Comprehensive revenue generation + Economies of Scale

Ease of Implementation: Multi-platform support

Organizational Capabilities: Package selling + Partnership

Positioning: Leading position + Network externality + Unique positioning

Risk Evaluation: Preparation for regulation changes + Privacy Protection

Results

LOCATION-BASED SERVICESINDUSTRIAL AND BUSINESS ANALYSIS

Telecommunication Management F2011

THANK YOU!Q&A

Location-based Services

Documents

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