What are the Latest Trends in the European LBS Platforms and Middleware Market?

November 9, 2011

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Mobile location-based services are applications and services that in some way utilize the geographic location of a handset. Adding location information can enhance an existing service or enable entirely new applications. Countless consumer and corporate services that make use of automatic location of handsets or other assets have been launched in Europe. Mobile location platforms enable mobile network operators to offer location-based services to end-users. Location platforms typically comprise several enabling servers and software extensions to network infrastructure components that together can calculate the position of a handset and mediate the data to a querying application. Many mobile operators also deploy location middleware that functions as a mediator between the location platform, applications and support systems – and more importantly, provides centralized control of privacy settings for all applications.

Location technologies can be divided into handset-based technologies, such as GPS, with intelligence in the handset, network-based technologies for instance Cell-ID, Enhanced Cell-ID and U-TDOA, with intelligence in the network and hybrid technologies, for instance AGPS, with intelligence in the handset and the network. Handset-based and hybrid technologies often require additional hardware and software in the handset, while network-based technologies require deployment of hardware and software in the mobile network. Operators need to consider several technical and economical aspects when choosing what location technologies to deploy for emergency and commercial services. Each technology has different characteristics and ultimately, no single technology performs best in every aspect.
The E911 mandate was a major driver behind the development of location platforms for the US market. In Europe, platform vendors instead focused on commercial services due to the lack of a clear mandate for emergency services. Many operators were interested in acquiring location platforms to deploy services and the rollout accelerated during 2000 and 2001. In the first deployment phase, lasting from 2000 to 2003, operators invested in platforms and ready-made location services. The results were in many cases limited uptake whereby many operators lost interest in LBS as a mass-market proposition. 
A new wave of increasing demand for location platforms followed after 2005 when the European Commission started to enforce the European E112 emergency caller location regulations. Today, the demand for new platforms has slowed again as most operators have installed at least basic location platforms that comply with current regulations. In the future, many operators can be expected to acquire system upgrades that will enable higher capacity and improved location accuracy. Demand is likely to come from stricter location accuracy requirements in future emergency call and lawful intercept mandates imposed on mobile operators as location technologies mature and costs decline. Moreover, along with increasing interest in services and applications for mobile phones in general, location services are now experiencing a comeback. Much of the interest comes from third party developers and service providers that want to add location to existing services and applications, leveraging the fact that operators are moving towards opening their platforms.
Although A-GPS and the SUPL A-GPS standard receive much of the attention in conjunction with the growing number of GPS handsets being introduced, network-based location methods are also likely to experience an upswing. Emergency services, lawful intercept and many commercial services need to be able to locate any handset and therefore favor network-based methods. Moreover, A-GPS services also need complementary hybrid and fallback methods in environments where GPS cannot operate alone. 
Berg Insight forecasts total annual revenues in Europe for GMLC and SMLC mobile location platforms, including SUPL A-GPS servers and location middleware, to grow from about € 18 million in 2009 to € 35 million in 2015. These revenues comprise integration fees and licenses for new platform deployments as well as capacity and technology upgrades, maintenance and associated services. Berg Insight has more detailed information in a lengthy report about the current status of the European mobile market.

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