SAN FRANCISCO-If the kickoff for Navteq’s Global LBS Challenge is any indicator, 2006 may be the year location-based services finally get legs.
Software developers, reporters, venture capitalists and other insiders packed the room here Tuesday for the North American launch of Navteq’s annual competition. The global digital map provider began accepting submissions from developers looking to earn a piece of the $800,000 in cash and prizes up for grabs for the most innovative and practical location-based applications.
More than 180 developers registered for last year’s challenge, and organizers expect more entrants this year, said George Filley, vice president and general manager of the company’s Consumer Business Unit.
“The LBS Challenge focuses on the wireless challenge of what we do (at Navteq),” Filley said. “We spend a lot of time trying to support the entire community to be able to enable them to create solutions that help people do things better, faster, or easier, or to improve their lifestyle.”
Interest in the contest has increased so much, in fact, that the company launched a separate competition for European developers at 3GSM earlier this year. Winners of the European contest will be announced at next year’s show, while North American winners are set to be unveiled next year at CTIA in Las Vegas.
After years of being over-hyped and under-delivered, LBS is gaining serious interest from developers, investors and operators, who are scampering to comply with federal E911 mandates. Sprint Nextel Corp. has gained traction with its location-based offerings, and other Tier 1’s are deploying enterprise-targeted LBS applications.
Separately, Mapquest unveiled a GPS device that allows drivers simply to touch the screen to determine driving directions. Dubbed the Personal Navigation Device, the $700 device has a Bluetooth link that can access traffic updates from a Bluetooth-enabled handset.
With carriers finally becoming able to support similar offerings, it’s up to software developers to find applications that can take advantage of new technologies, said Winston Guillory, Navteq’s senior vice president of North American sales.
“All these things are converging together in the market, which creates opportunities to develop all types of new applications,” he told the standing-room-only crowd.
Navteq maps are used by auto-navigation companies such as On-Star and ATX, and the company’s data powers mapping offerings from AOL/Mapquest, Google, Microsoft and Yahooo! Vindigo, a New York-based publisher of wireless applications, also uses Navteq maps.
Representatives from operators, venture capitalists and analysts will serve as judges for the contest, and prizes will be awarded in four categories: business applications, entertainment, navigation and social networking. A grand-prize winner will receive $50,000 in cash and $100,000 in Navteq licenses for up to a year.
But as important as those prizes could be to a startup trying to scrape by, a top finish could mean substantially more in venture capital, according to last year’s winner.
“It’s really about validation,” said Andrew Graham of Bones in Motion Inc., which took home top honors last year. “We’re happy to report we have received numerous offers for financing. … Winning the LBS Challenge has been a key calling card.”
An Austin, Texas-based developer, Bones in Motion’s application allows users to monitor their workouts with a GPS-enabled mobile phone. Other winners from last year include Networks in Motion Inc., InfoGation Corp., Loc-Aid Technologies L.L.C., and Smarter Agent Inc., which developed a real estate-based service that delivers property descriptions, sale prices and other information on nearby properties.
The practicality of such high-tech applications is attracting venture capitalists who see mass-market potential in LBS. And because Navteq has mapped about 9 million miles of roadway-the company has field researchers in 122 offices in 21 countries-offerings easily could deliver information about, say, a restaurant near a tourist in Tokyo.
“The (venture capital) industry is moving toward the consumer,” said Mark Sherman, general partner of Battery Ventures. “I think we see this as being one of the interesting applications that has many consumer uses.”
But more than being its own application, the key to LBS may be its ability to integrate with any number of offerings. Developers are exploring ways to use location technology to improve community-based offerings, marketing campaigns and even entertainment content, according to Marina Amarosa, an analyst with The Yankee Group.
“The future of location-based services is finally on a more robust path than we’ve seen in the past few years,” Amarosa said. “Location not as its own application, but sitting behind the whole realm of data and content.”
