In Depth

Location-based services: Controversy at every level

maps location history

Like it or not, commerce increasingly involves keeping tabs on the customer's location.

Jody Stevenson doesn't know she's been using location-based technology -- and doesn't care.

"I've been having a ball for almost a year," says the New Jersey homemaker. She enhances her shopping experiences with a service called Shopkick, which gives her loyalty points (convertible to gift cards and cash) just for walking into a participating store.

Or, rather, an app on her smartphone (if she has remembered to invoke it) decides that it is inside a participating store, and rewards her with loyalty points (called "kicks"); the amount varies by individual store and the promotional policies of that store. She also gets varying points for scanning bar codes of specific merchandise, whether she buys the items or not.

Overall, location-based services use three different levels of accuracy -- vicinity to within a block or two (derived from GPS coordinates), presence (establishing that you are inside a given building or store) and department (pinpointing your location within a given store).

Shopkick makes use of the presence level, primarily; it's also the level that's demonstrating the most commercial success and producing the most fears about Big Brother-style surveillance.

Vicinity

With modern smartphones able to locate themselves using the GPS satellite network, applications that allow multiple users to compare their locations for specific purposes are becoming well established.

Here on Biz
Here on Biz, a mobile app, locates nearby business people one might be interested in meeting, based on their social media entries.

"I was in Chicago for a client meeting and was interested in meeting with the people in a large firm located there," recalls Garen Mareno, director of strategic partnerships for a design firm in Los Angeles. So he consulted his Here On Biz app, which locates nearby businesspeople he might be interested in meeting, based on their social media entries.

"When I got there, many people from that firm popped up on my Here On Biz radar. I was able to set up drinks and make that first step. Another time I was in Russia and was able to reach out to colleagues I did not know were there," Mareno recalls.

The main controversy at the vicinity level appears to involve the question of whether to display the results on a map, since doing so would seem to allow, or even promote, stalking.

"We refuse to do mapping; we think it's a security issue," says Nick Smoot, one of the founders of Here On Biz.

Another example of a vicinity service is POS REP (Position Report), intended to let military-service veterans find each other. It displays a map showing nearby veterans by branch of service, but the locations are only approximated until a user "pops a flare" indicating a desire to be found, explains Anthony Allman, co-founder.

Presence

GPS signals typically don't penetrate buildings, so determining presence inside a store requires additional technology. Meanwhile, if the information is shared with other stores, it raises all sorts of questions, notes Evan Schuman, founding editor of the Storefront Backtalk newsletter and a retail technology consultant.

"As you enter a gift store they could know you just left a flower store -- but what if you were a married man buying for another woman?" he suggests, adding that stores are not sharing such data yet.

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