A recent study commissioned by the Bavarian Regulatory Authority for Commercial Broadcasting (BLM) and carried out by strategy consultant Goldmedia has found that location-based services in Germany are providing a wide variety of offers, have an increasing user base and are also likely to experience high rates of growth. At the end of 2012, there were 181 location-based services (LBS) providers in Germany. That number is expected to increase, with experts predicting that almost every app will incorporate an LBS function in the future. One in four Germans are already using a service of this kind.

1. Location Based Services 2013 in Germany
Short report
Berlin, February 2013
Prof. Dr. Klaus Goldhammer | Christine Link | Johanna Tietz
Oranienburger Str. 27 | 10117 Berlin-Mitte | Germany
Tel. +4930-246 266-0 | Fax -66 | Info[at]Goldmedia.de
www.Goldmedia.com
Picture: © Seyyahil_Fotolia.com
Goldmedia GmbH Strategy Consulting

2. Location-based services 2013
Objectives and methodology
Client
 Goldmedia carried out a study on the location-based services
market in Germany for the Bavarian Regulatory Authority for
Commercial Broadcasting (BLM)
Objectives
 Market overview of the current situation, range of services, usage and local
advertising market potentials of location-based services (LBS) in Germany
Methodology
 Project period: November 2012 to February 2013, presentation of the results on
February 2, 2013 at the Local Web Conference in Nuremberg
 Approach: extensive online desk research as well as five expert interviews with
service providers and industry representatives
Bild: © Seyyahil_Fotolia.com
Vertraulich/Confidential, © Goldmedia
2

3. Location-based services
Table of contents
1.
Definition
2.
Market structure
3.
Usage
4.
Potentials
5.
Legal concerns
6.
Forecast
Vertraulich/Confidential, © Goldmedia
3

4. Functionality of location-based services (LBS): after
localization location-based information are provided
Using procedure/definition of location-based services (schematic)
+
locating
position-fixing
(via GPS, GSM,
WLAN, etc.)
end device
service providers transmit
location-based
information
map/
data
locating
provider
user
service
Source: Goldmedia analysis, 02/2013
Vertraulich/Confidential, © Goldmedia
4

5. Location-based services
Table of contents
1.
Definition
2.
Market structure
3.
Usage
4.
Potentials
5.
Legal concerns
6.
Forecast
Vertraulich/Confidential, © Goldmedia
5

6. LBS development since 2005: dramatic increase of
providers from less than 10 to more than 180 in GER
number of
providers
>180
<10
2005
2006
Source: Goldmedia analysis, 02/2013
Vertraulich/Confidential, © Goldmedia
2007
2008
2009
2010
2011
2012
2013
Picture: © Seyyahil_Fotolia.com
6

7. general information
12 %
5 % 12 %
navigation &
maps
9%
4%
7%
food service
industry
8%
Share of
LBS
providers
3%
based on181 services
Germany, 1/2013
2%
7%
5%
Source: Goldmedia analysis, 2/2013
Vertraulich/Confidential, © Goldmedia
taxi
6%
6 % 12 % 6 %
social
gaming
7

8. Location-based services
Table of contents
1.
Definition
2.
Market structure
3.
Usage
4.
Potentials
5.
Legal concerns
6.
Forecast
Vertraulich/Confidential, © Goldmedia
8

9. Study overview: 30% to 42% of smartphone owners in
Germany used LBS at least once a week in 2012
30%
37%
42%
of Germans
already use
location-based
services, 29% are
interested
of mobile internet
users utilize
location-based
services at least
once a day
of smartphone
users search for
local information
at least once a
week
Results
 Studies by TNS, AGOF and Google from 2012 show that at least every third
German is already using location-based services
 Two in three smartphone owners have location-based applications at their
disposal
Source: TNS (Mobile Life Study 2012), Google (Unser mobiler Planet: Deutschland), AGOF (mobile facts 2012-II), 02/2013
Vertraulich/Confidential, © Goldmedia
9

10. Mobile Monitor: location-based apps are among the
most-used apps of smartphone users in GER in 2012
Results
My three most-used apps are… (2012)
What's App
facebook
Weather forecast
ebay
Deutsche Bahn
Spiegel
Navigation
Angry Birds
Kicker
web.de
Skype
GMX
Opera
Google Search
tagesschau
n-tv
google maps
Bild.de
Amazon
Twitter
Calendar
Barcode reader
TV Spielfilm
Public transport
552
522
294
85
65
64
64
58
50
44
43
42
39
39
36
36
34
32
32
29
29
28
27
27
0
100
 Asking smartphone users
for their most-used apps,
7 in 24 apps are locationbased
 522 in 1,969 respondents use the facebook
app most frequently,
which also includes
facebook Places
 The second most-used
LBS-app is ebay; it is used
by 85 in 1,969
respondents and also
uses location-based data
200
300
400
frequency of nominations
500
600
 Other approved locationbased services refer to
navigation and locationbased information as well
as information about
local transport (except for
Twitter)
Source: Goldmedia Mobile Monitor / respondi 2012: n=1,969
Vertraulich/Confidential, © Goldmedia
10

11. Location-based services
Table of contents
1.
Definition
2.
Market structure
3.
Usage
4.
Potentials
5.
Legal concerns
6.
Forecast
Vertraulich/Confidential, © Goldmedia
11

12. Europe: high growth in LBS market revenues
expected by 2017, about 1 bn EUR in just 5 countries
Mobile LBS market revenues in million €, EU27 and EU5, 2010-2017
1.400
1,270
EU27: 27 EU countries
1.200
1,040
EU5: Germany, France, UK, Italy, Spain
1.000
850
800
600
400
325
400
200
58 50
115
100
630
500
965
800
650
210
170
2010
2011
2012
2013
2014
2015
2016
2017
Facts
 Countries of EU5 (Germany, France, UK, Italy and Spain) generate most of LBS
revenues – by 2017, 178 m mobile users are expected. For the EU27 255 m
mobile LBS users are expected.
Source: IDATE, “Mobile LBS”-Report, June 2012, Electronics.ca Publications, ”Mobile LBS Market and Data Report”, June 2012
Vertraulich/Confidential, © Goldmedia
12

13. LBS advertising revenues of German providers
increase to 188 m EUR by 2017 in GER, CAGR 63%
Share of LBS market revenues in Germany 2011-2017 in EUR / Goldmedia forecast
Goldmedia forecast
265
159
37
57
85
206
Other
revenues
118
10
16
33
56
2011
2012
2013
2014
87
2015
130
2016
188
Advertising
revenues
2017
Details
 LBS revenues increase by 49 percent from 2012 to 2013
 Ad-financed services with highest growth potential: share of ad revenues in
total revenues is expected to be around 40 percent in 2013 and will increase
to around 71 percent in the next five years
Source: Goldmedia analysis, 02/2013, German LBS/providers only
Vertraulich/Confidential, © Goldmedia
picture: © Seyyahil_Fotolia.com
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14. Business models: almost half of location-based services
in GER are ad-financed (44%), 24% with in-app sales
Share of business models by a total of 180 German LBS providers (1/2013)
free
21%
freemium
3%
sale of app
8%
advertising
44%
in-app sale
24%
Source: Goldmedia analysis, 01/2013
Vertraulich/Confidential, © Goldmedia
14

15. Location-based services
Table of contents
1.
Definition
2.
Market structure
3.
Usage
4.
Potentials
5.
Legal concerns
6.
Forecast
Vertraulich/Confidential, © Goldmedia
15

16. LBS: only 39 percent of respondents feel safe by
using apps with incorporated localization
”Do you use location-based applications
which reveal your current location (GPS)?”
”Do you feel safe by using apps with
incorporated localization?”
(e.g. Google Maps, Facebook, AroundMe, etc.)
no
31%
yes
39%
no
61%
yes
69%
69%
use them…
…but
61%
don‘t feel safe.
Source: Goldmedia Mobile Monitor / respondi 2012: n=1.969
Vertraulich/Confidential, © Goldmedia
16

17. Smartphone users are afraid of data abuse when
they use location-based services
Concerns of smartphone users in Germany regarding data privacy (5/2012)
I ‘m afraid of using localization
because I’m not sure whether my
privacy is protected.
I always pay attention to which
apps trigger my local position.
8%
10%
5%
I fully agree
squarely agree
I agree
10%
53%
21%
I don't know
11%
40%
17%
I don't agree
I don't agree at all
24%
Facts
 Half of smartphone users in Germany pay attention to apps using localization
 40 percent of users have concerns about revealing their location
 Insecurity regarding data protection inhibits LBS usage
Source: Goldmedia analysis, based on fittkaumaass.de, W3B report “Location-based Services”, April/May 2012.
Sample: 65,884 German internet users, internet representatives quoted and weighed of age, sex and federal states
Vertraulich/Confidential, © Goldmedia
17

18. Location-based services
Table of contents
1.
Definition
2.
Market structure
3.
Usage
4.
Potentials
5.
Legal concerns
6.
Forecast
Vertraulich/Confidential, © Goldmedia
18

19. SWOT analysis: location-based services
Strengths
Weaknesses
 Vicinity to user and daily deals/
offers in real-time
 Facilitation of everyday life in
numerous fields
 Advertising meets customers at
point of sale (POS)
Prospects
Threats
 Advertisers are increasingly
interested in targeting and
localizing their potential customers
 Growth potential for start-ups
 Prospective location-based feature will
be integrated in almost every app
Result
 Approvals for localization of
smartphone users are necessary
 LBS require advertising customers
with local basis/effort of targeting
 Booking and measuring systems
 No successful mobile advertising
media on the market yet
 Concerns in terms of data
protection law/ fear of data abuse
inhibit growth
LBS can be incorporated in almost every single service; however,
successful monetization depends on future acceptance
Vertraulich/Confidential, © Goldmedia
19

20. Impact of location-based services on the local
advertising market in Germany
 Advertising revenues generated by location-based services/
market volume in Germany (85 m EUR) still too low
 No observable effects on the local advertising market
2013
2014/2015
 There is still a comparatively small market for German providers
 Therefore, no cannibalization effects are expected
 However, additional revenues were expected because of the
novelty effect
From 2016
 Optionally shifting tendencies or budget restructuring
 This potential development has to be further monitored and
possibly to be operationalized for local advertisers themselves
Source: Goldmedia, 02/2013
Picture: © Seyyahil_Fotolia.com
Vertraulich/Confidential, © Goldmedia
20

21. Thank you!
Please contact us for further information.
Berlin, February 2013
Prof. Dr. Klaus Goldhammer | Christine Link | Johanna Tietz
Oranienburger Str. 27 | 10117 Berlin-Mitte | Germany
Tel. +4930-246 266-0 | Fax -66 | Info[at]Goldmedia.de
www.Goldmedia.com
Picture: © Seyyahil_Fotolia.com
Goldmedia GmbH Strategy Consulting