Location: The Next Frontier in Social?
Since Google acquired Dodgeball in 2005 mobile location-based social networking hasevolved quickly. Even though Dodgeball foundered as part of Google many new companiesentered the space in the years that followed; most failed to gain traction due to low consumer awareness of location-based services and minimal penetration of sophisticated smartphones.
Mobile location-based social networks became more viable when Apple’s iPhone and Google’sAndroid platforms were introduced in January 2007
and November 2007,
respectively, and asthe high-speed 3G network became more widely available. These mobile platforms’ associatedapplication stores, launched in July and October 2008, respectively,
offered easier discovery anddownloading of user-friendly applications based on location. With the launch of foursquare (the f is intentionally lowercase) at the South by Southwest Interactive festival in March 2009, thesecond phase of mobile location-based began in earnest, as foursquare, Gowalla and, mostrecently, Facebook Places all went live. Winners in the space are beginning to emerge, with someolder players already bowing out: Brightkite, a location-based social network that was in public beta in April 2008, then acquired by mobile social network Limbo in April 2009,
announced inDecember 2010 that it was eliminating its check-in option to pivot towards the latest mobile trend:group messaging (though it will continue to offer location sharing).
With Facebook’s entry into location-based in August 2010, the basic check-in – recording“I am here” – became commoditized,
and the companies still in mobile location-basednetworking are seeking to exploit multi-sided network effects by building more value for userswith hope of bringing merchants, marketers and developers to their platforms.This paper will explore the mobile location-based social networking space with a focus onthe players that, in my estimation, best embody the struggle between a multi-sided network and anested bundle as of April 2011: foursquare, the pure-play scion of Dodgeball representing thenetwork, and Facebook, the behemoth would-be enveloper.
As of February 2011,69.5 million people in the US owned smartphones, or 29.7% of the total mobile phone-toting population, with three platforms accounting for 87.1% of all smartphones: Google (33%), RIM (28.9%) and Apple(25.2%). comScore MobiLens. “comScore Reports February 2011 U.S. Mobile Subscriber Market Share.” April 1,2011. http://www.comscore.com/Press_Events/Press_Releases/2011/4/comScore_Reports_February_2011_ U.S._Mobile_Subscriber_Market_Share. In April 2009, smartphone penetration was only 11%. Flosi, Stephanie Lyn.“Americans Get ‘Smart’: iPhone, Android and the Accelerating Adoption of Smartphones.”
comScore: June 15, 2010.http://blog.comscore.com/2010/06/americans_smart_iphone.html
Business Insider. “iPhone.” http://www.businessinsider.com/blackboard/iphone
Wikipedia. “Android (Operating System). http://en.wikipedia.org/wiki/Android_%28operating_system%29
Wikipedia. “List of digital distribution platforms for mobile devices.”http://en.wikipedia.org/wiki/List_of_digital_distribution_platforms_for_mobile_devices
Schonfeld, Erick. “Mobile Socializing: Limbo Merges With Brightkite And Announces $9 Million Funding Round.”TechCrunch: Apr 7, 2009. http://techcrunch.com/2009/04/07/mobile-socializing-limbo-merges-with-brightkite-and-announces-9-million-funding-round/
eMarketer. “Beyond the Check-In.” January 2011. Pg. 4.
Andy Ellwood, Director of Business Development at Gowalla, noted that, “We started saying around April of that the check-in was close to being commoditized. And when Facebook Places came out, that was the final nail inthat coffin.” eMarketer, “Beyond.”