SXSW: Location, location, location fuels mobile apps

A spate of location-based apps generates buzz at SXSW

Soon FourSquare won't be the only cool kid on the location-based apps block: A new wave of startups, including Highlight, Zaarly, TaskRabbit and Localmind, are generating buzz at South by Southwest by drawing on smartphone location data to deliver a range of social, commercial and informational experiences.

Panel heats up over privacy concerns

Highlight is a "social discovery" app that notifies users when they are near someone they don't know with whom they might share interests. It runs in the background, only requiring the user's attention when it has found a potential social contact.

Andrea Vaccari, the founder of Highlight competitor Glancee, said in a conference presentation that by focusing on introducing users to new people, social discovery serves as "the natural extension of social networking."

Localmind, a location-specific question-and-answer platform, offers what might be called social information. One user can find others who are currently checked in, using FourSquare, at a particular location and then ask how long the line is or which band is playing -- important questions at SXSW. Localmind launched last year at the conference and, according to co-founder and CEO Lenny Rachitsky, "is out of control" this year. Still, only 200,000 questions have been asked since the app launched, according to the company.

Localmind doesn't include advertising now, but Rachitsky said it will likely eventually look to targeted, location-based ads to generate revenue.

TaskRabbit and Zaarly merge social networking with the DIY economy. TaskRabbit, available as an iPhone app, allows users to post tasks they want done and what they are willing to pay. Any legal task can be posted, but the app focuses on conventional services like repairs and maid service. The app matches the task master with a nearby worker who makes the best offer. Workers go through a vetting process that includes a criminal background check. Once in the community, they are ranked by reputation. When task masters pay the workers, using a registered credit card account, TaskRabbit takes a transaction fee.

TaskRabbit was an early comer to the space, launching in late 2008. But it seems to be thriving now that other mobile location apps have grown in popularity, according to a representative.

Zaarly, which launched in May, focuses on the sale of goods, rather than services, within a given location, although it can also offer services. Would-be buyers post what they want. Would-be sellers can search offers based on price and distance. The buyers then choose among the responses to their offers. There's no obligation to accept any offer. When a task is completed, Zaarly takes a cut.

The system requires users to verify their identities with an email address, a phone number and a Facebook account.

"We are much more like a mobile, optimized, well-lit Craigslist than anything else," co-founder and CEO Bo Fishback said.

So will the location-based apps change the mobile landscape or are they a flash in the pan? One factor that has the potential to slow growth is user concern over privacy protections.

Location data has opened up a flood of innovation, but has also raised concern among privacy advocates and privacy-sensitive users.

The new class of apps obtain location data in a variety of ways. Highlight, which launched at SXSW, gets GPS data directly from the user's mobile phone. TaskRabbit and Zaarly use GPS data from phones, but can also run in a desktop browser. Other location-based apps build on location data gleaned from user-submitted content on social networks including FourSquare, Facebook and Twitter.

Annette Zimmermann, an analyst at Gartner, said that privacy is an issue in most of the location-based apps, which, she said, "do not have the transparency that one should wish for consumers, so that they understand clearly when they share their location and with whom."

Still, while users say they're concerned about privacy, their online behaviors usually don't reflect it, she said. If the apps make consumers' lives easier and if they are game-like enough to get users hooked, they'll be popular, she said.

Cameron Scott covers search, web services and privacy for The IDG News Service. Follow Cameron on Twitter at CScott_IDG.

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