Location-based services (LBS) are software applications that provide information or functions to users based on their device's geographical position. These services use real-time geodata collected from satellites, cellular networks, or Wi-Fi signals. Marketers use LBS to deliver context-aware experiences, such as localized advertisements, navigation, and proximity-based coupons.
Entity Tracking
- Location-Based Service (LBS): Software that uses geographic data and information to provide specific services to users.
- Geodata: Information gathered in real-time through tracking technologies that identifies a device's physical location.
- Global Positioning System (GPS): A satellite array used to pinpoint a device's precise location on Earth via signal delay.
- A-GPS: An assisted version of GPS that uses network data to speed up the process of finding a device's location.
- 802.11mc: A Wi-Fi standard that uses Fine Time Measurement (FTM) to calculate location with higher accuracy than signal strength alone.
- 802.11az: A next-generation positioning standard designed to provide sub-meter accuracy similar to ultra-wideband technology.
- Ultra-wideband (UWB): A high-frequency, short-range wireless technology that provides centimeter-level location accuracy.
- Radio Frequency Identification (RFID): A system using radio waves to track tags at specific scanner locations to identify the position of physical assets.
- Geofencing: The practice of using virtual boundaries to trigger specific actions when a device enters or exits a designated area.
- Trilateration: A geometric principle that determines a single location by calculating its distance from three or more known points.
What is Location-Based Services?
LBS is a general term for software that requires geographical coordinates to function. This technology integrates data from multiple sources, including satellite navigation, mobile devices, and cellular networks. It allows businesses to drive real insights from data tied to specific locations where activities take place.
For a service to qualify as LBS, it usually requires four components: an application, a positioning mechanism (like GPS), a mobile network to transmit data, and analytics software to compute the results. Organizations use this data to understand spatial patterns, relationships, and user behaviors.
Why Location-Based Services matters
LBS offers a significant financial opportunity for businesses. [The LBS market accounted for more than $36 billion in 2020 and is predicted to reach more than $318 billion by 2030] (Allied Market Research). The specific [indoor location services market is projected to reach $55 billion in revenue by 2030] (Gartner).
Key benefits include: * Enhanced Customer Experience: Users receive relevant content and rewards, such as discounts when they are near a specific store. * Detailed Behavioral Insight: Businesses can track how many people visit a location and when they visit. * Safety and Emergency Response: Services like E911 automatically provide a caller's location to emergency dispatchers. * Operational Efficiency: Logistics companies use LBS for fleet management, asset tracking, and verifying that employees are where they need to be. * Fraud Prevention: Banks use LBS to match a customer’s physical location to a credit card transaction to flag suspicious activity.
How Location-Based Services works
The system determines a device's location through several tracking mechanisms. Satellite navigation relies on trilateration to find a location if the distance from other known points is clear. Indoors, where GPS signals are weak, systems use Wi-Fi access points or Bluetooth beacons as reference points.
Modern Wi-Fi positioning often uses Fine Time Measurement (FTM) based on the 802.11mc standard. Unlike older methods based on signal strength (RSSI), which offer 10-meter accuracy, [FTM uses round trip time to provide 1–2-meter accuracy] (HPE Aruba Networking). Data is then processed by analytics software on remote servers to deliver the final service to the user.
Types of Location-Based Services
LBS applications are generally divided into how the information is triggered:
| Type | Mechanism | Example |
|---|---|---|
| Pull Services | The user initiates the request for information. | Searching for the "nearest ATM" or checking in on Yelp. |
| Push Services | The application initiates the service based on a trigger. | Receiving an SMS coupon as you walk past a specific retail store. |
Services can also be classified by environment. Outdoor services rely heavily on GPS, while indoor services use localized technologies like Wi-Fi, UWB, or RFID. [The European GNSS Agency estimated that 40% of all computer applications used location-based software as of 2013] (European GNSS Agency).
Best practices
- Prioritize Opt-In Consent: By law, LBS must be permission-based. Ensure users explicitly agree to share geodata before tracking begins.
- Offer Clear Opt-Out Options: Provide straightforward settings for users to disable tracking or limit it to when the app is in use.
- Implement Data Anonymization: Protecting privacy is critical. Research shows that [four approximate spatio-temporal points are enough to uniquely identify 95% of 1.5M people in a mobility database] (MIT).
- Use Multi-Technology Triangulation: Combine GPS, Wi-Fi, and cellular data to maintain accuracy when users move between indoor and outdoor environments.
- Limit Data Retention: Only hold location data for as long as necessary to complete the service to reduce security risks.
Common mistakes
Mistake: Using only signal strength (RSSI) for indoor navigation.
Fix: RSSI is easily affected by building materials. Use FTM or 802.11mc for 1–2 meter accuracy.
Mistake: Failing to update map reference points.
Fix: When moving Wi-Fi Access Points (APs), update their coordinates in the system. [Research shows only 25% of APs are currently mapped accurately] (HPE Aruba Networking).
Mistake: Sending too many push notifications (proximity spam).
Fix: Target notifications based on frequency and user intent to avoid being seen as intrusive.
Mistake: Assuming GPS works effectively indoors.
Fix: GPS requires a clear line of sight to satellites. Use indoor-specific tech like Bluetooth beacons or UWB.
Examples
- Ridesharing (Uber/Lyft): These apps use LBS to identify a user's exact pickup location and find the nearest available driver without manual address entry.
- Proximity Marketing: A retail store sends an automated discount code via an app when a loyalty member walks into a specific mall or department.
- Location-Based Gaming: Pokémon Go uses real-world geographical coordinates to place game characters in specific physical locations for players to find.
- Asset Tracking: Shipping companies use RFID and GPS to track the movement of containers across global supply chains in real-time.
- Weather Services: Apps like Carrot Weather use location data to provide a forecast unique to the user's exact street address.
FAQ
Are location-based services legal?
Yes, but they are regulated. In the US, the CAN-SPAM Act makes it illegal to send messages without an opt-in. Legislation like the Location Privacy Protection Act of 2012 also attempts to regulate how user data is shared with third parties.
How accurate is LBS?
Accuracy depends on the technology. GPS and Wi-Fi FTM generally provide 1–10 meter accuracy. UWB can provide centimeter-level precision. However, signal strength methods (RSSI) may only be accurate within 10 meters.
Can users be tracked without their consent?
While legitimate apps require permission, there is a large industry for location data. [Near claimed to have data from 1.6 billion people in 44 different countries] (The Markup) as of 2021, and there are currently few rules governing who can buy this aggregated data.
Do location-based services drain battery?
Continuous use of GPS and high-frequency pings to cellular towers can increase battery consumption on mobile devices. Some apps use "self-reported positioning" (check-ins) to reduce this drain.
What is the difference between LBS and RTLS?
LBS is a broad term for services provided through geodata. Real-Time Locating Systems (RTLS) are more specific, standardized systems (like ISO/IEC 19762-5) often used for high-precision local tracking within a closed environment.
