During the past 18 months, tremendous change has been experienced by the consumer location-based services or LBS sector. This has forced the North American wireless carriers to cope with a vastly different competitive landscape. Smartphone application storefronts and free off-deck solutions are now directly attacking the carrier dominance in the North American consumer LBS sector.

In 2009, on-deck application software revenues of approximately $718 million were amounted by the wireless carrier-generated segment of the North American consumer LBS market. According to new analysis from Frost & Sullivan (News - Alert), “2010 North American Consumer Location-based Services (LBS) Market – The Wireless Carrier Opportunity”, this revenue is expected to reach $1.58 billion by 2015.

In order to successfully carve out and keep a significant portion of the LBS sector's potential revenue, wireless carriers must become more creative and aggressive in leveraging their unique assets. The consumer LBS market is being driven by powerful technology and greater customer awareness. Carriers are being provided more opportunities to partner with top-tier application developers and create, launch, and promote new LBS solutions.

In a release, Jeanine Sterling, Senior Industry Analyst, Frost & Sullivan said, "In tandem with smartphone advances, carriers are making their networks and locationing capability more accessible to LBS application developers. Partnerships with location aggregators, open application programming interface platforms, and simpler, quicker certification reviews make it easier for LBS developers to stake a claim to the market."

Smartphone users are encouraged to bypass wireless carriers and download LBS solutions directly from the phone's application store with new monetization models and higher channel fragmentation. Smartphone storefronts are making available most of these location-based applications for free or at a one-time fee. Hence the monthly subscription model needs to be justified in a strategic manner by the carriers.

In a release, Sterling added, "Some LBS solutions – such as the kid finder services – are just an automatic and perfect fit. Other applications and capabilities may not be as obvious. To thrive in this market, carriers have to be real marketers – monitoring customer needs, identifying product voids, working with creative partners, and publicizing the distinct benefits that carriers bring to today's mobile user."

For further reading, visit http://www.wireless.frost.com.