Location data - a trade-off between control and value: Business model implications

Abstract

The evolution of mobile technologies, and the enormous increase of users have also consolidated location related services as an inherent part of the mobile service landscape. The possibilities to detect one's whereabouts and relate them to any kind of networked information offer benefits for users and various kinds of businesses. However, LBS also present issues, harmful particularly to users' privacy. This paper assesses mutually beneficial interaction in multi-sided markets (value is collective and actors are interdependent) and the gatekeeper role of user ownership (i.e. control over the user and data). It adopts a business modelling perspective to: (a) define the value network around LBS as two-sided markets, where the LBS provider intermediates between end-users and Third Parties; and (b) extract potential revenue models. It focuses on trade-offs between who has control in the ecosystem and how value is created. Finally, the paper assesses how current developments around LBS contribute to changes in the position of the user within the ecosystem.