Location-aware phones to earn €622m by 2010

'I'm on the bus! Oh, you knew that already... '

Location, location, location. Mobile operators have seen more than their fair share of false dawns as far as location-based services (LBS) are concerned but analysts believe payback could be just around the corner.

According to a new report from Berg Insight, LBS will be worth €622m in Europe by the end of the decade, a 34 per cent year-on-year average increase.

Unsurprisingly, navigation looks to be the most successful location-based service, according to Berg Insight. The analyst predicts that by the end of the decade almost half of LBS revenue will come from navigation.

Interest in some quarters of the industry is gaining momentum. Nokia recently bought mapping company gate5 while Intel is also trialling location aware phones. On the operator side, O2's i-mode has started to offer a mobile version of Streetmap.co.uk which can triangulate a user's location and pinpoint them on a map.

Johann Fagerberg, senior analyst at the analyst house, predicts many of the larger handset makers will start to bring location aware mobiles to the market shortly.

Some mobile operators have been offering location based services for some time now, such as O2 Germany and Genion, where users pay cheaper rates if they use their mobile inside their homes. Since its LBS launch, O2 has signed up 2.3 million Genion subscribers.

The analyst reckons 18 million Europeans will opt for location based billing by 2010.