GOTHENBURG: Location-based mobile services are set to enjoy rapid revenue growth in Europe and North America, aided by social networks and greater interest from marketers, a study has argued.
Berg Insight, the consultancy, reported the amount of people utilising these tools will more than double in these regions over the course of 2011, assisted by the rising uptake of devices like the iPhone.
"Higher adoption of smartphones is driving usage of mobile internet services and apps in general," said André Malm, senior analyst at Berg Insight.
"As more and more developers add location support in their apps to enhance the user experience, LBS is now gaining mainstream acceptance among mobile subscribers."
More specifically, 20% of mobile subscribers in the European nations tracked will regularly employ these services by the end of this year, hitting 30% in North America, where smartphone penetration is higher.
"The installed base of GPS handsets in Europe has reached 35% of total handsets and surpassed 70% in North America," Malm added.
Revenue levels in North America stood at $620m in 2010, and Berg Insight suggested the returns generated by this channel should be $710m in 2016.
Figures for the 29 major European markets featured - including France, Germany, Italy, Spain and the UK - came in at €205m in 2010, and were pegged at a potential €435m by 2016.
Social networking sites are seeing especially impressive growth concerning mobile phone access rates, with tools like Facebook Places and Twitter's equivalent service enable members to easily share their whereabouts.
This category is expected to witness the biggest expansion during the period covered by the analysis, reflecting the broader trends at work across the digital arena.
Ads are already the "main source" of revenues in most categories - except mapping, where this figure falls below 10% - but while adspend will grow, it may be "some years" before a real marketing model and critical mass of users and develop, the study said.
Data sourced from Berg Insight; additional content by Warc staff