As a result of the recent “locationgate” controversy (centering on Apple’s and others’ logging of the location of mobile devices as they are used by consumers) the location-based services (LBS) and advertising (LBA) markets have come under intense scrutiny, with privacy legislation a major focus.

“ABI Research believes that this temporary debate will not prevent the future success of location-based services, marketing and advertising, all of which will be based on location analytics – the aggregation and analysis of location information to identify trends that will enable new services and more effective advertising.”

But according to ABI Research senior analyst Patrick Connolly, “ABI Research believes that this temporary debate will not prevent the future success of location-based services, marketing and advertising, all of which will be based on location analytics – the aggregation and analysis of location information to identify trends that will enable new services and more effective advertising.”

The firm forecasts size of the location analytics market to reach $9 billion in 2016.

At the moment, the initial LBA trials are largely focused on geofencing, with impressive results. However, the real power of LBA will come through social, geographic, physical and emotional indicators to filter advertisements to a specific user. The best way to combine these indicators and target them to individuals in a non-intrusive, anonymous way is through location analytics.

Practice director Dominique Bonte adds, “While the location analytics market is relatively new, it has been evolving for a number of years and has been the major driver for recent location-related acquisitions by the likes of Apple, Google, Nokia, Facebook and Microsoft. Eventually, location will become commoditized and will be treated as just another piece of demographic information. Consequently, location analytics will become the core provider of value in location-based advertising.”

A number of companies are already involved in this space, including PlaceIQ, Placecast, Sense networks and Skyhook Wireless/SimpleGEO, as well as the industry behemoths mentioned above.

ABI Research’s new study, “Location Analytics and Privacy” (http://www.abiresearch.com/research/1007751), investigates how privacy is controlled across the ecosystem, what will be the result of recent investigations, and how companies are adapting to the future.

It is part of the firm’s Location Platforms and Enablers Research Service (http://www.abiresearch.com/products/service/Location_Based_Services) which also includes other Research Reports, Market Data products, ABI Insights, Surveys, ABI Vendor Matrices, and analyst inquiry support.

ABI Research provides in-depth analysis and quantitative forecasting of trends in global connectivity and other emerging technologies. From offices in North America, Europe and Asia, ABI Research’s worldwide team of experts advises thousands of decision makers through 40+ research and advisory services. Est. 1990. For more information visit www.abiresearch.com, or call +1.516.624.2500.