FCC’s Future Location Requirements, Apple iPhone 4S

Update:

Many press reports recently said that the Federal Communications Commission plans to require GPS in all mobiles by 2018, including LBS Insider (October 12, 2011). However, the FCC said that isn’t quite so, saying that “not before 2019, on a date still to be determined, carriers will have to meet the more stringent location accuracy standards that now apply to those carriers using a handset solution for [enhanced 911], and they may choose which solution to use.”

FCC spokeswoman Lauren Kravetz said that these technology solutions may be GPS chipsets, network-based, or a hybrid. The FCC said, after the conclusion of an eight-year period that ends in early 2019, it will sunset the existing network-based rule and require all wireless carriers to meet “the more stringent location accuracy standards in the handset-based rule. The FCC will then set a specific sunset date for a network-based standard — after further notice and comments.”

An announcement completely overshadowed by the Apple iPhone 4S rollout may have a major impact on the location-based services industry. The FCC has said that all wireless carriers, including voice-over-IP service and landline providers, are required to integrate GPS into phones by 2018. In other news, Intel bought Telmap, which has made inroads into the LBS market with its partnerships with carriers.

In a move designed to allow first responders to locate 911 emergency calls, the Federal Communications Commission will require all wireless operators, including voice-over-IP service and landline providers, to integrate GPS in phones by 2018.

The FCC says the majority of mobile phone users will have GPS-installed devices by the 2018 deadline. The FCC did not set a deadline for phones that do not use GPS-based technology. In addition, VoIP is going toward more mobile applications, rather than its original substitute for landline service.

Most industry experts agree that the rise of location-based services occurred when the FCC mandated that carriers have location capability during its enhanced 911 rulemaking. Wireless carriers chafed at the deadlines and accuracy requirements. However, the rulemaking did bring market awareness to the carriers to the benefits, and potential new markets, coming from this mandated location requirement.

While it is too early to tell how much this will help drive LBS markets, the FCC said the decision, which was overshadowed as it was announced the same week as the rollout of the Apple iPhone 4S, was spurred by the desire to modernize 911. This means locating emergency callers quickly, particularly from smartphones and other mobile devices.

But have the wireless carriers lost their grip on LBS? In 2009, the surge in the number of GPS-enabled smartphones, proliferation of handset and mobile OS application stores, and increased availability and consumer demand for free or low-priced LBS applications has had a huge impact on the traditionally carrier-controlled LBS market, said Dan Gilmartin, Where vice president of marketing.

“The decreased costs and barriers to entry into the market place and ability to reach consumers through low- or no-cost viral social marketing channels is enabling small application developers to compete with the established LBS developers. The result is a highly competitive landscape that beforehand was dominated by only a few major players,” he said.

Gilmartin said that Google’s decision to offer free turn-by-turn navigation and acquisition of ADMob for $750 million reinforced the expectation that the viable business models for LBS in 2010 and beyond will include offering free or “freemium” services to consumers through ad-supported and other non-traditional funding models. “That said, the carriers’ subscription model still appears viable, at least for the short term, and consumers are proving to be willing to pay for what they perceive to be high-quality applications both on- and off-deck, navigation being the most prominent category,” he said.

Go Ask Apple? 

The rollout of the Apple iPhone 4S may not be the biggest thing for the LBS market, but it does open it further to another tier-one carrier in Sprint. Like other iPhone models, the 4S has GPS embedded, but offers Siri voice-recognition that integrates with its navigation capability.

When LBS Insider contacted Sprint for comments on the new iPhone 4S and the FCC decision that GPS be installed in all smartphones, we got the public relations brush off to “Go ask Apple.” Ask Apple about GPS and LBS? This is an interesting response, as Sprint was one of the first major LBS market players, particularly their Nextel folks who were very innovative with location technology in the early days.

Intel Buys Telmap

At least one company in the LBS market is doing something right when a big company like Intel buys it. As GPS World reported, Intel bought Telmap, the Israel-based LBS company. The deal was announced at the recent Intel AppUp Elements developer conference in Seattle.

Motti Kushnir, Telmap chief marketing officer, said that since Telmap is a private company, financial details cannot be disclosed. He said the deal will take effect by the end of the year. “Telmap will be a wholly owned subsidiary and will maintain its independence as well as its brand,” Kushnir said in a prepared statement.

Kushnir said no layoffs are expected, nor will facilities close or be moved by Intel. “On the contrary, we are expected to grow in order to support the growth of our business both in existing and new territories,” he said.

One of the reasons Intel bought the company is that it is sees mobility as one of its growth engines — and location is a key component, Kushnir said.

Telmap says it has 6 million users for its IP portfolio that includes mapping, local search, and navigation. This includes a new restaurant LBS initiative in Israel. The company is working with Rest, a large Israel restaurant guide to provide location-based coupons to customers.

In other LBS industry news:

• Fierce Wireless made an admittedly subjective list of the worst cell phones of all time. Garmin’s ill-fated Nuvifone G60 made the list. The phone, a partnership between Garmin and Asustek Computer, featured LBS — and had a $5.95 monthly charge for premium service. Fierce Wireless says that it was a failure in part because of Google’s free location services.
• Nokia will be closing down its operations in Bonn, Germany, and Malvern, Pennsylvania, with an expected loss of more than 1,300 jobs in the Location and Commerce divisions. According to published reports, operations will consolidate in the Berlin, Boston, and Chicago offices. Another 2,200 layoffs will come from its European manufacturing operations.
• This column has admittedly neglected traffic markets lately, but will be running more stories and interviews soon. With that, some big news has come out of that market, namely Google’s recent deal with INRIX to power its navigation and mapping applications. INRIX traffic information will be integrated in Google’s online products and services and on mobile phones.

Meanwhile, INRIX competitor TomTom is launching a Traffic Foundation that brings together stakeholders from academia, industry, and policy-making to help reduce traffic congestions. The company also rolled out its Custom Probe Counts at the ITS World Congress, that allows government and business markets to assess traffic density. The company also expanded its coverage from 14 to 18 countries.