In the last few weeks, the wireless world has been buzzing about location-based services (LBS), applications made primarily for wireless devices that use GPS, WiFi or cellular radio signals (or a combination of all three) that enable consumers to get information and advertisers to reach them based on their location. Some recent developments include:

• Buzzd, a new, featured application on RIM’s BlackBerry AppWorld that allows users to find nearby restaurants, shops, and events based on their location.
• Navteq was chosen by MetroPCS to be the preferred supplier of all maps that are used in Metro’s LBS applications.
• WeFi opened up its own app store to provide applications that leverage its existing WiFi access point community to move consumers who use bandwidth-intensive applications off the carriers’ networks and onto WiFi. This is key in light of the recent SlingBox and Skype mobile app denials.
• Skyhook Wireless (a technology provider for location-based services) released some data it had mined from various application stores about the growing quantity of LBS applications and the fact that almost 75% of LBS applications for the iPhone cost money rather than being given out for free.

After all of this activity in the LBS arena, is there any demand for these apps? If so, what are people using them for? And what are the opportunities for advertisers and carriers? Compete’s recently-launched Smartphone Intelligence product answers these and related questions, and a few highlights of the findings appear below.

Overall, 1 in 3 smartphone owners currently use a Location Based Service at least once a month. An additional 20% of smartphone users said that they would be interested in using LBS if they knew more about what was available and how to use them. The chart below shows some specific types of LBS applications consumers are using now (shown in the dark blue bars) or would use if they had more information (light blue bars):

As seen in the chart, weather and directions/navigation applications are the current leaders in the LBS space. Two thirds of survey respondents who already use LBS said they use a weather application while slightly over half told us they use a navigation app.

However, when asked which types of LBS they would prefer to use if they were available or knew how to use them, we saw some interesting results, particularly appealing for advertisers. It turns out that consumers are also interested in getting local alerts and special offers or promotions from nearby stores or other retailers. This presents an opportunity for advertisers to reap the rewards by serving up compelling and relevant ads that will likely see higher clickthrough rates and subsequent engagement. Also, ROI from these types of promotions would be easier to measure as the benefits are more immediate and trackable to a specific customer interaction than many other forms of advertising.

In addition to being valuable tools for local businesses and advertising networks, LBS services are also important to carriers who provide the data packages and may possibly split the application revenues. It turns out that smartphone owners who use LBS are more likely to spend more each month on their total wireless bill. In the chart below, we see that LBS users (red bars) are less likely to be spending $75 or less on their monthly wireless bill and more likely to be spending $125+ than smartphone owners who do not use LBS.

So, in addition to being a good segment for advertisers to target, LBS users are valuable customers for carriers as well. It will be important for carriers to decide how to best leverage all the different app stores to maximize subscriber use of LBS.

It looks like consumers are ready for new LBS applications, and we’ll be watching to see what advertisers, device manufacturers, carriers and application providers come up with in the next few months.

How important is it for wireless carriers and handset manufacturers to have an effective online strategy? Very. A recent study by Compete and Google found that the majority of wireless phone buyers are researching online, and that attracting searchers has short-and long-term benefits.

The study found that 78% of consumers who made a wireless purchase used the internet for research beforehand, even though 94% of transactions are completed offline. This means that almost 12M consumers will use the web to research their purchase before buying from one of the Big Five carriers in Q4 alone, a finding with huge implications for the industry.

Search plays an important role in the research and decision-making process of online wireless shoppers, particularly high-value consumers. 24% of online wireless shoppers were observed using a major search engine to arrive at a wireless web site, such as a carrier site, handset manufacturer site, a wireless blog or community site, or an agent site like Amazon or Let’s Talk.

As shown in the graphic, half of the searchers said that they had used search engines throughout the entire research and shopping process.

The research showed that searchers are more likely than non-searchers to spend more on their cell phones: 27% of searchers spent more than $100 compared to 20% of non-searchers. A likely result of their interest in high-end handsets, searchers may also yield higher ARPU over their contract periods, as shown in the chart below:

• Searchers are more likely to use all types of value-added services on their phone every month
• This high propensity to consume these services means searchers spend more on their wireless bills each month and may therefore have a higher lifetime value than non-searchers

The bottom line is that a strong online and search marketing strategy is extremely important for wireless marketers. Every company should be:

• Investing in a strong web presence which will have a noticeable impact on decision-making for more than three quarters of your potential customers
• Developing a search marketing strategy that caters to consumers at each stage of the research cycle, from brand building to comparison to driving conversion
• Paying attention to searchers – they may be higher value customers

These findings are just a small part of the study. Click here to watch the Compete and Google Webinar in order to see more results, or contact us at rburke@compete.com for more information.

In September 2006, Compete reported on the marginal, albeit growing, interest in mobile TV and video products services online at Big-4 carrier websites. At the time, online consumers exhibiting interest in mobile TV and video services comprised just half of a percent of all Big-4 carrier website traffic.

Compete recently completed an online study surveying existing Big-4 customers regarding their interests and preferences around this new entertainment medium. Of 2,500 of customers surveyed, 13% indicated that they would be interested in watching TV and videos on their wireless phones, with men more likely to adopt (17%) than women (12%). When asked about specific content that they would be interested in watching, Big-4 customers reported that live TV was the most appealing.

The mobile TV industry has evolved since September, specifically with Verizon Wireless launching V-CAST Mobile TV during early March in select cities around the United States. Advertising and marketing campaigns promoting V-CAST Mobile TV have led to a 104% increase in consumers evaluating the service on VerizonWireless.com. Big-4 carrier interest in mobile TV and video has thus grown to almost 1% of all web site traffic, and looks to continue growing, with AT&T planning a live video service of its own in coming months and Sprint continuing to add channels to its own MobiTV lineup.

This early data bodes well for key players in the mobile TV supply chain, including the content networks, technology enablers, and of course, the wireless carriers and MVNO’s. Consumers, however, should prove to be the real beneficiaries as interfaces improve with the advent of more advanced multimedia handsets (iPhone anyone?), programming options expand with more content players getting into the mix, and the price inevitably decreases as competition heats up. This all adds up to a rosy future for mobile TV adoption if these early signals are correct. Stay tuned.

You air travelers out there know there are plenty of things that can go wrong between takeoff and landing. Whether it’s a seat that doesn’t recline, a tiny overhead where your overflowing “carry on” won’t fit, or a general lack of cocktail service on that 7am flight, sometimes you wonder if you’re better off taking the minivan.

Enter SeatGuru.com, a nifty website that has all the information about airplane travel you’ll ever need. Self-proclaimed as “the ultimate source for airplane seating, in-flight amenities and airline information”, SeatGuru’s claim to fame is an interactive seat map with denotations for good through poor seats as well as locations of bathrooms, exits and power ports for the road warriors. Simply choose the airline and specific airplane type, and you’ll be able to view the seat map for that flight.

Besides helpful seating tips, SeatGuru also offers information regarding in-flight food, drink, audio, video, child and pet services. Now all they need to do is label open seats next to single supermodels.

Mobile video has emerged as one of the hottest technologies in the wireless industry. All the major carriers have launched mobile TV services, and the investment community continues to pour money into enabling technologies. So far, consumers have responded with limited but growing interest.

Interest in mobile video on the Big-4 carriers’ websites increased 80% over the past year, yet still represents less than 1% of carrier website traffic, according to recent data from Compete, Inc. Overall, content including ringtones, games, wallpapers and applications represents a much larger 13% of total Big-4 website traffic.

Enhancing and marketing mobile video services’ ease of use will be crucial to converting novelty interest into mass market adoption. Mobile TV services feel complicated and expensive to most consumers. That can be remedied through stimulating viral marketing and communicating these services’ ease of use. Offering demos and tying the online channel into the mobile experience through content shifting and file sharing will help as well.

With advanced services like mobile television, carriers and key content players must both build awareness and educate consumers about the offerings. As consumers’ primary wireless research channel, the Internet offers companies a way to encourage that education process as well as benchmark, measure and continuously improve their approach.

You probably don’t know what MVNO stands for (Mobile Virtual Network Operator) or what an MVNO does (uses an existing wireless network, jazzes up the service and phone and markets under a different brand) but turns out you just might be a lot more familiar with an MVNO than you realized.

The idea behind the MVNO concept is that an existing brand or even a completely new brand can piggyback off an existing wireless network (think Sprint’s or Verizon Wireless’s) and create a more relevant wireless experience for very specific demographic or cultural segments. Amp’d Mobile and Virgin Mobile USA are music and pop culture-focused services with slick handsets for the rock and rollers. Boost Mobile targets the hip-hop and extreme sports crew. Disney Mobile offers parents the ability to monitor and control their child’s phone use and offers attractive family plan packages. Mobile ESPN caters to the hardcore fantasy sports and stat checking crowd. And there plenty more already out there or on their way.

So to recap, the MVNO gets cheap access to an expensive wireless network while their partner (again, think Sprint, Verizon Wireless, etc.) gets a share of their profits. MVNO life is good, right?

Not exactly. I don’t have a single friend that uses any of these services. I know, I know – I don’t have any friends to start with, but I haven’t even seen a stranger walking down the street using an Amp’d or ESPN phone. Have you?

However, it appears that MVNO’s are finally getting some notice. 40% of people are aware that ESPN offers some type of wireless service. 28% know that Disney offers the same. Awareness of brands without the luxury of a massive Fortune 100 company backing them, such as Helio and Amp’d, lag ESPN; however, it’s still impressive that 1 in 4 people have heard of the Amp’d service.

Now, all they need are some people who will buy them.