Mobile phone location services ready for rebirth May 27, 04

Mobile phone location services ready for rebirth
Thu May 27, 2004 08:43 AM ET By Lucas van Grinsven, European Technology Correspondent

AMSTERDAM (Reuters) - The use of a mobile phone to pinpoint a caller's location and nearby businesses was a hot concept when the tech bubble peaked in 2000, but only now with better phones and software does it stand to succeed, companies say.

Mobile operators are selling much-improved services that help users locate friends or get directions to the nearest train station, but they have to fight off consumers' bad memories from 2000 and 2001, when they offered illegible maps on tiny black-and-white screens.

"People had terrible experiences three or four years ago," said Rick Smith of M-Spatial, a wireless map and route-finder software company, at the annual Mobile Location Services conference this week.

These days, maps or directions are tailored to a handset's small screen, which is now in colour. The maps are designed to meet specific demands, such as to help pedestrians who need landmarks to simplify their orientation when they come out of an underground train station.

Britain's Vodafone sell these services as part of its Live! offering. France's Orange, Sweden's TeliaSonera and China Mobile have also activated such services.

These moves signal the rebirth of a wireless industry segment, which at the moment is bringing in a meagre 0.2 percent of total operator revenues, according to British telecoms consulting group Concise Insight.

"There's an opportunity for things to improve," said Jake Saunders, a director at the consulting firm.

WHERE EXACTLY?

Until now, the slow take-up of location services has been compounded by the inaccuracy of systems to locate a handset.

The most widely used technology, called Cell ID which measures the angle and time it takes for a mobile phone signal to hit a radio base station, gives coordinates that can be off by hundreds of metres and up to several kilometres.

Many early services failed to take this margin of error into account, frustrating consumers.

"Some 60 percent of users are not satisfied with the current services," said director Jason Angelides of TruePosition, a U.S.-based and Liberty Media-owned wireless location service provider.

The latest services have become more useful, because they first ask customers to specify where they are in a certain area. But in many other cases, exact coordinates are needed.

Emergency services, for instance, now receive over 50 percent of calls from mobile phone users who are often in a panic and unable to give their precise location.

"And the mobile network only tells us that the phone is somewhere in a certain circle, which is often five kilometres wide, which is no good to us," said Graham Curry, manager of Lancashire's Assistant Operations.

His ambulances must find a patient suffering from a heart attack within eight minutes to be able to save a life.

EUROPE FOLLOWING UNITED STATES?

Several new technologies -- from assisted-GPS chips, which communicate with satellites, to U-TDOA software, which measures the distance from a phone between three radio base stations -- have emerged to refine the location of phones.

Government policy will force usage of these new systems.

In the United States, location services got a boost from a government mandate that by end-2005 all mobile phones must be pinpointed to a small radius. CDMA phones will mostly be fitted with A-GPS chips, while GSM networks are upgraded with U-TDOA.

Europe, aware that its security and emergency services also demand accurate location data, is watching closely. Every year, millions of European emergency calls go to waste because the location information is inaccurate, the European Union found.

"The problem is increasing as a result of high (handset) penetration," said Leo Koolen, a policy and regulations advisor at the Information Directorate of the European Commission.

Unlike the U.S., Europe has not yet demanded that mobile operators provide a minimum level of location accuracy, but the Commission will review that soon, Koolen said.

"We may need to adjust and see if it's necessary to amend accuracy requirements. The EU will review the situation by the end of 2004 and see if we need a mandate like the United States," Koolen said.

Operators balk at these requirements, which can cost them tens of millions of euros per country. But higher accuracy will also open up new commercial activities, and consumers may find their carriers will start sending limited time offers via text message if they enter a certain coffee shop or department store.

In a TruePosition survey, 80 percent of consumers said they would be interested in emergency location services on their phones.

Said TeliaSonera's Peter Bianconi: "It will re-open the location market in a new way."