We shared with you last week a story published by The Wall Street Journal about how mobile applications draw our personal data from our devices in ways few of us understand. We would expect our social-media apps to do such (Facebook, our myriad of Twitter-based software, FourSquare, etc.), but The WSJ found that information-based apps and websites often share even more of our personal data than do social media.
One of aspects of our personal data that we seem less willing to share is our personal space – or at least where our personal space is at any given moment. Location-based services are growing, if FourSquare’s numbers are any indication. But their numbers are still small in relation to the buzz about their potential.
Plenty of attention was showered on Facebook’s new ‘Places’ and ‘Deals’ when they were announced last year. Apple claimed a patent on its own social-medial networking system, iGroups, last spring, which included development of location-based networking via the iPhone’s quasi-GPS triangulating features. And FourSquare continues to lead the pack.
Yet, Joshua Brustein suggested in The New York Times last fall that the users of such services still have not taken to them in ways retailers are hoping. Which is not stopping investors and developers from forging ahead with a great deal of money:
As of August, only 4 percent of American adults who used the Internet also used location-based services, which allow people to “check in” to physical locations via their cellphones to earn coupons or keep up with friends. And only 1 percent of Internet users are on such services on any given day, an indication that those who do use the services still have not integrated them into their daily lives.
Still, companies like Foursquare and Gowalla, two of the leaders in the location-based services market, have had no trouble raising money from investors. Advertisers are on track to spend $1.8 billion on location-based marketing in 2015, according to ABI Research, a technology market research firm.

Diagram from BDNooz (Click on Image)
Mr. Brustein nicely explains the exchange of information that mobile users offer instead of money: we are willing to barter our personal statuses rather than cash to get information or services we had to pay for a generation ago. Yet – thus far – most seem reticent about including a running tab of where we are for the sake of receiving a stream of coupons and deals based on where we are. He posits that an element of ‘creepiness’ or the danger of letting the world know where we are might be holding us back.
So too might there be a move back toward a more traditional cash-based online economy. The Pew Internet and American Life Project released a survey in January showing a growing number of people willing to pay for online content. Admittedly, the average dollar-amount was $10, which will hardly excite content providers, but it will worth watching to see if the numbers grow.
It also would be interesting to see if the community of users engaged in location-based software can be more clearly defined over the next number of months. Certainly the young use such social media more than their parents. But the Pew survey also points to the suggestion that college-educated people (especially women) are more likely the pay for their content. Perhaps their greater earning potential helps them absorb the cost of some $10 a month – perhaps they are better informed about how their locations could be used against them, as well as for their benefit.
Such a demographic community is also the most likely to support nonprofits with regular donations and to invest their time with charities.