Sunday, August 22, 2010

Check-in Reality Check

FaceBook Places up on iPhone this week is another check-in reality check for Location Based Services (LBS) growth.

The interesting thing about this new launch is that Facebook partnered with the two leading LBS players of the moment - Foursquare and Gowalla.  Yelp who is famous for its local reviews LBS service and Booyah have also jumped into the Facebook's Places party.

From the outside, it's all about the beauty of physically connecting with your friends thanks to the power of location-aware social networks.  This video posted by Facebook sets this friendly ambiance all along:

However, in my view, beyond this friendly facade filled with plenty of 360-degree, fine-toothed smiles begins the non so friendly standard war for social check-in ownership.

Check-in growth means big bucks.

In the end, LBS is just a new marketing tool to create a new depth of marketing segmentation, one that traces our social habits from the real world back to the check-in owner's databases.  By overlaying some sort of loyalty or incentive marketing program over our digitalized real-world consumption patterns, as a marketer you are likely to get higher return on your marketing dollars than what you would traditionally achieve through mass media.

Now, back to Places.  It sounds that the check-in ownership definitely helped to shape up the structure of this new LBS deal.  Not all stakeholders have appeared to strike the same kind of agreement with Facebook.  It doesn't look like check-ins are co-owned all the time.  What I mean by that is that you may check-in through Places but that information may only belong to Facebook and may not trickle back down to the LBS originator.  Say that you are an heavy Foursquare user and that you transfered all your check-ins to Facebook places through the new Places API (that one-way transfer is allowed apparently), if you check-in Places after the transfer, I am not sure that Foursquare gets that informaton back...?  Yelp did get a two-way deal, not sure Foursquare and Gowalla did but they may have agreed on a one-way deal as it gives them great exposure to the 500M+ Facebook users for greater service awareness.

Are we on for a check-in standard war on the socnets?

It seems like we are headed into a mosaic-patterned LBS horizon.  What if you start building points for a given brand using Gowalla?  Do your branded check-ins apply in Foursquare or do you have to build two seperate collections of check-ins?

I don't believe that there is any check-in standard in place so far.  On top of that, overlay the segmentation at the mobile phone hardware/software levels and you get a supper dupper LBmeSS.

What about open standards?

Wouldn't the check-me-in pie be much larger should standard check-ins be discussed and shared among all major players of the LBS market?

This reminds me of the GSM days in a way.  Back in the beginning of the 80's, in 1982, a new digital wireless group composed of super smart wireless experts came to life.  This was the "Groupe Special Mobile".  It took about 10 years for the GSM (Global System for Mobile Communications) to become the "2G" standard which gave birth to the first 2G network in Finland in 1991.

Today, GSM is the technology that is most globally adopted.  One of the main reasons why it has known such a phenomenal penetration is because the target audicnce (the wireless carriers in that case) had the flexibility to build their GSM networks from different GSM equipment suppliers.  For example, you could elect to build some of your radio sub-system with Nokia while your network sub-system could be bought from Siemens.  The GSM standard guaranteed that the different pieces within the network could openly talk to one another.

Yes, it did take some time to get to the GSM standard, but in the end it openly fluidified the target audience value proposition by lowering long-term risk and reducing acquisition cost, as a result, the technology adoption rate went banana around the world.

That's why, I am wondering...
Shoudn't all of the current LBS players step out of their walled garden and raise up their heads to the formidable potential of future check-in open standards?

Consumers would tremendously benefit from technology-agnostic check-ins and so, I believe, would the LBS ecosystem as a whole.  LBS would be turned into Location Be Sustainable!  :-)

As I was laying out my thoughts on a napkin for this post this morning, I came accross a tweet from @loic.  It struck my attention as Loic mentioned the iBody appstore.

Loic takes the stale one-dimensional physical "check-in" dimension into a richer multi-dimensional approach where other sets of data, related to our biometrics, could flow into the socnets through relevant APIs.

You can check out Loic's blog post on the subject.  Here is the video that he posted:

So, if more and more digital dimensions from our lives are bound to flow into the future streams of the emerging social networks, don't open standards make even more sense?

Open platforms, open standards may be the sustainable routes to open innovation.

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