One of the hottest areas of development in social media these days is location-aware applications. Most of the companies involved in this development are privately-held startups like Gowalla and Foursquare, but one six-hundred pound gorilla has now weighed in among publicly traded stocks. Google Inc. (NASDAQ: GOOG) has announced a free, open API for its location-aware app called Latitude. Apple Inc. (NASDAQ:APPL) hasn’t made any plans yet for a competitor, but is surely taking notice.
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What makes Latitude different from the others is that a user does not need to check-in from his or her current location. Instead, the Latitude application, which requires that users explicitly choose to use, automatically tracks your location and stores that data so that it can be used by third-party developers to build specific applications. The location data is never stale, instead always showing the current location of the user.
Google noted a possible application could turn on the furnace in your house as you drive home from work without any action on your part. Once Latitude tells your home thermostat that you are 15 minutes from home, the thermostat kicks on and the house is nice and toasty by the time you get to the driveway.
Every application developed for Latitude would require that the developer specify exactly what data the app needs and why, and users would need to explicitly agree to share that data. As Facebook’s recent woes over its Open Graph functionality show, making it difficult for users to get out from under the thumb of Big Brother chases away some users and gets a company a load of bad press. The latter is usually more of a problem than the former, at least for Facebook.
What Google lacks, though, is the large social piece of the puzzle. What Foursquare, Gowalla, and Facebook offer is that built-in social graph of friends and contacts with whom a user might want to share information about a fabulous new restaurant or a hot night club. The social aspect of these services is what makes them valuable, both to users and to advertisers. Latitude looks great for single-user apps, but what has made Foursquare and others in this space compelling for users is the social aspect.
Google’s answer to Facebook, called Buzz, has not gathered a lot of traction and without that social graph of Facebook’s 400 million users, it’s a little difficult to see how Google will become the central repository for location data.
Location-awareness is all about advertising, and there’s a lot at stake here. Being able to deliver ads based on a user’s location at a specific time might be yet another transforming web technology. What Google offers is a way to keep track of you for dozens of apps, that you have explicitly signed up for, without having to check in every time you go to a new location.
A new report out from IDC today notes that the mobile ad market grew to $220 million in 2009 and is expected to nearly double in 2010. That’s not much compared with the $72 billion ad spend projected for online advertising, but the growth rate for online spending is negative. It will take a long time for the mobile and online spend lines to cross, if they ever do, but Google wants to have a foot in both camps. That’s the primary reason the search giant is seeking to buy AdMob and the same reason that Apple Inc.
(APPL) recently purchased Quattro Wireless.
The short history of the worldwide web has shown that users are willing to give up some privacy in return for something they value. When that privacy appears to be stolen without giving anything in return, then some users get mad. If you’re Facebook, you can say let ’em eat cake. Google is trying a different way.
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