Location based services are not new, some, such as Loopt have been around since 2005 but 2010 is the year that they’re really taking off.  Loopt has around 3 million users in the US (its not available anywhere else) but it differs greatly from the current trend in location based services, that of moving away from “always on” location to that of “checking in” at specific locations.

Foursquare and Gowalla are leading the charge of the ‘Geosocial‘ location based mobile services, with Foursquare having recently had 370k “check ins” in one day. With only 500k registered users the leader, Foursquare, is still relatively small compared to other, traditional, social networks (Facebook, with 400m users is by far the biggest social network but doesn’t yet have a Geosocial aspect) but it is growing fast.

Arguably 2010 will be the year of location based social and business networks, especially with services such as simpleGeo offering location infrastructure to startups. This lowers the barrier to entry significantly allowing start ups, such as stickybits, to provide geotagging in its unique offerings.

So is it all hype? From a business point of view are they worth engaging with like other social media?

Its not just about being Social

Foursquare and its peers have positioned themselves squarely (no pun intended!) in the social media space with a light gaming element. Users are encouraged to check in at places by gaining points and badges. I recently gained the “School Night” badge on Foursquare for checking in after 3am during the week and have become “Mayor” of one of the buildings on my University campus (displacing someone who obviously hasn’t been in a while!). The social side is about leaving tips for people at locations and letting them discover interesting things to do.

Businesses have started to warm to the idea of rewarding frequent visitors with free coffee (in Starbucks case) but this can go further. Many businesses run reward schemes with stamps and cards and its fairly simple to move this to location based rewards. After all, by checking in at a venue you’re in effect giving it your approval as a destination of interest. This type of marketing will become ever more important to business as 78% of people are said to trust peer recommendations.

Another startup launched at South by South West (both Foursquare and Gowalla were launched last year at SxSW) over the weekend is aiming to tap into the business networking aspect of Geosocial networks.

Pairwise was created by 2 strangers from San Francisco (no surprise there!), Euwyn Poon, 25 a corporate law graduate and software developer and Brandon Leonardo, 26 a professional software developer.

The idea was born out of Euwyn’s personal need to connect with as many business and software types as possible, this being his first SxSW and is first big opportunity to do some networking. Euwyn saw it as the perfect product to release at SxSW when scores of developers, journalists, venture capitalist would be in and around Austin.

Euwyn says:

“Pairwise is a mobile app that facilitates business networking by letting members of a crowd identify specifically who they’re looking to connect with. It further identifies hidden connections between people to make a “warm” introduction”

Find out more here.

There seem to be an endless string of startups and existing companies looking to use Geo location in their products. Twitter has recently activated its Geo tagging features on its main site (Geo tagging tweets has been available through the API since November, 2009). Facebook the biggest player in the social media space is expected to announce its own Geo location features at its f8 conference in April.

But its advertising that is expected to bring in the real money for Geo location based networks. Geo targeted advertising will become more wide spread with businesses jumping at the chance to leverage the users location to target advertising. Whether customers will want such location specific advertising pushed to their handsets is question these networks will have to answer in time. According to a recent article in the Economist, Location based services and the advertising opportunities associated, will be worth over $12 billion within 5 years, although forcast’s like these should be taken with a pinch of salt.

So really its all about Business?

Well no, not at all. I see ‘Geosocial’ networks as a logical extension of our current social networks. They all have the same idea in common, that of sharing with your friends / colleagues; Facebook is the platform that aggregates all of your past thoughts and future plans. Twitter has positioned themselves as a stream of things and thoughts happening right now and Fourquare and Gowalla extend this by tying you to places, adding the new dynamic of things you are doing, not to mention allowing your friends to join you and collecting badges in the process.

• Facebook is “hey friends, I want to share all this stuff with you, what ive been doing, what my plans are, my pictures etc”
• Twitter is “hey friends, this is what im thinking, this minute, right now”
• and Foursquare/ Gowalla is “hey friends I’m here, right now!”

There are of course, privacy concerns, but users and detractors alike should remember that the point of “social media” is that you should ensure your only sharing online what you would normally share in public in real life. Ensuring that sharing is still a “want and not a need” (@snafflepuss) will become ever more important in the Geosocial future.

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