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The New York Times' John Markoff has an interesting write-up today on a location-based service gaining traction in Japan, based on the technology of U.S.-based GeoVector. Achieving a similar end as mobile visual search, it uses a combination GPS, Web, and an electronic compass to help users find locations and businesses.

From the article:

"Mr. Matsunuma showed how it works on a Shinjuku street. He selected "lodgings" on the screen. Then he pointed his phone toward a cluster of tall buildings. A list of hotels in that area popped up, with distances. He chose the closest one, about a quarter-mile away. An arrow appeared to show him the way, and in the upper left corner the number of meters ticked down as he got closer. Another click, and he could see a map showing both his and the hotel’s locations."

The product has been able to thrive in the Japanese market because of dense urban areas, and more importantly a GPS mandate in mobile devices that isn't yet present in the U.S. As we mentioned in the recent Advisory Targeting Users: Application Level Innovation in Mobile Local Search, the lack of GPS ubiquity is currently the biggest barrier to adoption of location-based services and more advanced mobile local search applications in the U.S.

CDMA carriers including Sprint Nextel will have wide-scale GPS integration in the first half of 2007, and we should see the door swing wide open for these types of products at that point (although many other cultural and logistical factors will ultimately weigh in on adoption rates).

More significant are the possibilities to infuse performance based advertising. The beauty of this product is that it sidesteps one of the fears of location-based services — privacy concerns and spam advertising based on targeting precise location. This product is more active in its search capabilities so it ensures targeted advertising based only on information actively sought. Once it is combined with other performance-based advertising tools — such as click-to-call (push-to-talk) — it could be a powerful marketing vehicle and a well-received consumer product.

As Markoff's subject pointed out after finding his location using the product:

"There it is … Now, I just wish this screen would let me make reservations as well."

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