A research report by U.S.-based Pyramid Research reveals the strong growth of the global location-based services market, and predicts the market will only get bigger in the near future.
The group’s recently released “Location-based Services Market Forecast 2011-2015” states global revenue for the location-based services market is expected to reach US$10.3 billion in 2015. That’s up from $2.8 billion in 2010.
Driving this substantial growth are increasing GPS and smartphone adoption, the continued growth of mobile advertising and higher speeds and wider coverage of mobile networks. The report states there are also opportunities in social networking, advertising-based messaging and in-app advertising.
More than 60% of total location-based services revenue in 2015 will be generated from location-based advertising, according to Pyramid.
Jan ten Sythoff, an analyst at large for Pyramid, said in a release that local search will be the most important driver of location-based advertising revenues. “Not only are navigation applications moving to a search-funded model, but there are also a wide range of other companies looking to capitalize on the growth of local search, including start-ups (such as Poynt and Yelp), local business advertising specialists (such as Yellow Pages) and vertical aggregators (such as toptable and HotelBooker),” he said.
While applications have cost advantages over stand-alone personal navigation devices (PNDs), companies including Google and Nokia are switching from a payment to advertising-funded business model.