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The location-based services (LBS) market size is estimated to grow at a CAGR of 26.22% between 2022 and 2027. The market size is forecast to increase by USD 167.69 billion. The growth of the market depends on several factors, including the rise in demand for personal and enterprise navigation services, the high penetration of mobile computing devices, and the rapid adoption of beacon technology. Location-based services are part of software applications that use location data for internet protocol (IP)-capable mobile devices to track and trace where the mobile device is located.
This location-based services (LBS) market report extensively covers market segmentation by component (hardware, software, and services), type (outdoor and indoor), and geography (North America, Europe, APAC, South America, and the Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The rise in demand for personal and enterprise navigation services is driving market growth. These include real-time navigation, LBA, and payment services which help generate revenues through map updates fees and advertisements. Baidu offers a map application that gives a variety of location-based services like restaurant or hotel reservations, taxi booking, movie ticket booking, and traffic updates. Additionally, the efficiency of workforce management services, which enhances business productivity and operational efficiency is boosted by greater smartphone penetration. Real-time sensors also can help logistics companies to track goods’ movement.
Additionally, car navigation is increasingly shifting towards the adoption of voice assistance technology which can reduce possible distractions associated with touch-based navigation. For ease of integration of devices with LBS, Apple Inc. CarPlay allows users to use the audio system of their iPhone devices, including Siri. Moreover, leading car manufacturers like Volkswagen, BMW, and Toyota are offering in-built GPS navigation. Hence the above factors are likely to boost the growth of the market during the forecast period.
The growing popularity of location-based gaming is a key trend in the market. These include interactive map-based mobile gaming like Pokémon Go, and Geocaching that involve the player interacting in the game environment to progress further. This has transformed the gaming industry into an as-a-service model incorporating technologies like cloud computing, 5G, and virtual reality (VR). Game developers have included location analytics tools for players to track their movement and the movement of other players.
Additionally, there are even games that involve real-world locations such as Hello Kitty AR: Kawaii World launched by Bublar Group AB which uses the Google Maps Platform. This helps it incorporate a location-based augmented reality (AR) with real and imaginary locations in the game. Hence, the increasing popularity of such games shall boost demand for location-based services by game developers and result in further market growth during the forecast period.
Privacy and security issues are challenging market growth. For receiving coupons, deals, and promotions, people need to reveal personal and private information to advertisers and third parties, which results in the possibility of data leakage. Additionally, because these platforms are location-based, network providers have access to the real-time location of users and this could be shared without their consent. End-users are concerned about their privacy despite the presence of legal frameworks to safeguard it.
Hence, service providers must ensure adherence to regional and global data privacy laws which will also help retain consumer trust. One such key regulation is the General Data Protection Regulation, passed by the European Parliament in April 2016 to ensure data privacy and legal use of customers' location data. Hence data security and privacy are key challenges that could hinder the growth of this market during the forecast period.
The market share growth by the hardware segment will be significant during the forecast period. They include passive and active radio frequency identification (RFID) tags, beacons, and sensors. They can use existing infrastructure like Wi-Fi access points or might require upgrading of the prevalent infrastructure with components like infrared (IR) sensors and RFID or sonar components as per requirements. For instance, Hewlett Packard Enterprise Development provides Aruba Tags that produce location-based data within the range of BLE-enabled access points.
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The hardware segment shows a gradual increase in the market share of USD 11.42 billion in 2017 and continue to grow by 2021. Aruba tags have other features like batteries that require minimal maintenance as well as compatibility with medical applications and can be remotely controlled and easily deployed. Moreover, components used like RFID tags are economical and offered by numerous vendors such as AiRISTA Flow. They also have motion sensors to determine the transmission intervals, which help in battery usage optimization. Hence other factors are likely to contribute to the growth of the market during the forecast period.
The outdoor location-based services segment plays a vital role in improving the response times of emergency services. This ensures that government and local authorities can build cities keeping in mind population density from heat map which also enables public transport managers to predict and adjust routes to match the actual and future needs of commuters. This helps reduce congestion, improve safety, and optimize traffic clearance. Moreover, they help provide retailers, developers, and franchises with key location-based insights on which they can further leverage AI and other technologies to improve customer relationship management (CRM) and business intelligence (BI). Banks can utilize location-based data to drive branch expansion, optimize their regional promotions. Hence the above factors are likely to boost the growth of the market during the forecast period.
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North America is estimated to contribute 48% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
In the region, the US is the largest market with major vendors like major vendors such as ESRI, Alphabet Inc., Apple Inc, and Cisco Systems Inc. North America, who are also integrating AI and cloud computing into their services. Moreover, the demand for location-based services is greatly driven by the retail market which can utilize strategies like discounts and other offers, increasing sales revenue. Other industries that utilize location data and are demanding similar location-based services include the telecommunications, manufacturing, retail, and healthcare industries. Other factors that are driving the market in the US include high smartphone penetration and an increasing shift toward E-commerce. Hence all these factors will result in market growth during the forecast period.
The COVID-19 outbreak had a moderate impact on the regional market with consumers shifting towards E-commerce. This further expanded the ability for retailers to leverage location-based services and tools to boost sales. Additionally, large-scale vaccination programs by governments resulted in the resumption of activities by end-user industries, such as healthcare, retail, e-commerce, and transportation. Hence the above factors are likely to result in further growth of the market during the forecast period.
The Location-Based Services (LBS) Market report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Location-Based Services (LBS) Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
AiRISTA Flow Inc. - The company offers location-based RTLS solutions that provide location insights into people and assets.
Alphabet Inc. - The company offers location-based services under Google Cloud partner location.
Apple Inc. - The company offers location-based services that help to protect personal information on iPhone, iPad, iPod touch, and Apple Watch.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The location-based services (LBS) market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Location-Based Services (LBS) Market Scope |
|
Report Coverage |
Details |
Page number |
180 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 26.22% |
Market growth 2023-2027 |
USD 167.69 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
24.6 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 48% |
Key countries |
US, China, Japan, Germany, and UK |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
AiRISTA Flow Inc., Alphabet Inc., Apple Inc., AT and T Inc., Bayerische Motoren Werke AG, Cisco Systems Inc., Emanate Wireless, Esri Global Inc., Foursquare Labs Inc., General Electric Co., Halma Plc, Hewlett Packard Enterprise Co., International Business Machines Corp., Microsoft Corp., Oracle Corp., Qualcomm Inc., Siemens AG, Telefonaktiebolaget LM Ericsson, Zebra Technologies Corp., and Ziff Davis Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
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