According to a new research report from Sweden-based wireless analyst Berg Insight, mobile location-based service revenues in Europe are forecasted to grow from €220 million in 2009 to €420 million in 2015.
Berg Insight adds that local search, navigation services and social networking are poised to become the top applications in terms of number of users, which is sort of a give-away as those categories have already proven to be the most popular and fastest-growing among smartphone users worldwide.
Berg Insight, which offers business intelligence to the telecom industry and provides analysis to companies such as AT&T, Microsoft, France Telecom, IBM, KPN Mobile, NTT Docomo, Nokia, Telefonica O2, Vodafone Group, Alcatel and Motorola, estimates that one third of all mobile subscribers in Europe will use “some kind of location-enhanced application” on a “regular basis” by 2015.
The social networking category is forecasted to experience the highest growth in the coming years.
André Malm, Senior Analyst at Berg Insight, says growth will driven by increasing sales of smartphones, end-user awareness of mobile Internet services and applications, on-device app stores and more transparent pricing.
He adds that integration of GPS in handsets is an important driver: “The installed base of GPS handsets in Europe has recently surpassed 15 percent of total handsets and will increase to 50 percent three years from now.”
Finally, Berg Insight says the revenue model for many mobile LBS apps in the consumer segment is shifting from premium fees to ad-funding, as navigation services are becoming free for end-users and developers attempt to generate revenue through ads and various bundles.
Berg Insight warns that revenues may not grow at the same rate as usage, because the mobile advertising ecosystem is still nascent.