PewInternet released a report titled, 4% of online Americans use location-based services, and it was picked-up by several media outlets and re-posted on blogs and Twitter. One line in particular has seems to get quoted most:
“Pew reports that a two years after Twitter launched it only had 6% of the population using it. This suggests Foursquare (and Gowalla, to a lesser extent) are growing just as fast as Twitter did in its early going.”
While it is easier for people to consume data when comparisons are involved, I find this one very inappropriate and explained why in a post on LinkedIn which I wanted to share here.
There is a great deal of room for growth in LBS, but this is an unfair comparison. There is a significant difference between comparing an entire segment to one company.
Twitter is a communication channel (and a revolutionary one at that.) It is conversational medium and has more in common with email than LBS (though that line is blurring more and more.)
In this particular report “Location-based services” accounts for a handful of companies using game mechanics and offers to encourage sharing your location. And while brands are partnering with Foursquare, Gowalla and Facebook places, these apps have not become the communication channel that Twitter has.
So where does that leave LBS? In a great spot for growth. Twitter’s meteoric growth was partly spurred brands embracing the platform and extending a value (offers, promotions, customer service) which led to more users signing up for Twitter. In a similar fashion I expect that we will see more brands embrace their own LBS strategies (either partnering with the existing networks or building their own) and then we will see real user growth in this segment.