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Locating the Revenue in Location Services

By Harriet Meyers

According to the majority of market analysts, by the year 2004 revenue from location-based wireless consumer services in the U.S. alone is projected to rise to $3.9 billion from less than $30 million this year. And many countries in Asia and Europe are way ahead, already providing those services to their customers.

The Strategis Group conducted a study of market potential in the U.S. "We found that consumers were not only interested in location-based wireless services, but were also willing to pay for them," says Stephan Beckert, a senior consultant at Strategis.

"The industry today is like a moth attracted to a fire, making smaller and smaller concentric circles around the issue of location services," says Ira Gorelick, GTE Wireless' group manager of new products and technology. "We are trying to understand the requirements of the marketplace. The investment is significant, so we cannot afford to make it on a whim."

The Telecommunications Industry Association recently adopted a wireless location services standard which may open up new possibilities for CDMA carriers and manufacturers. The adoption of IS-801, which is compatible with IS-95 and CDMA2000, makes deployment of certain location technologies more feasible.

The CEO of software company MicroStrategy, Michael Saylor, thinks location- specific information services delivered via wireless devices will be the next major outcome of the information revolution. The key will be to wade through the endless amount of data available today and, using wireless phones, give individuals just the plums of information they need at any specific place and time. "Data has a life of its own-growth and potential are tremendous. But it needs to be personalized and simplified, and location does that," says Mark Flolid, SignalSoft Corporation's vice president of corporate development.

Location services lend themselves to tailor-made information packages for individuals. There are deliveries of regional information which help travelers find directions, a hotel, restaurant or gas station-and they receive the information in their native language. There are enhanced 411 services providing connections to an operator who knows exactly where the caller is and can supply what is needed. Enhanced roadside assistance sends the closest tow truck to help a motorist stranded by a flat tire. Microstrategy's Saylor pictures alert systems such as a drug alert to warn you if your new prescription may have an adverse reaction to your old one or a stock alert to let you know the movement of your investment portfolio. A new service being rolled out in Japan alerts friends to each other's locations.

Transaction
Omnipoint Technologies Inc. wants to enhance location-based services so people can not only receive directions to a restaurant but also make a reservation, or find the location of the closest automatic teller machine and conduct a transaction. "We envision a broad new class of consumer applications and devices of any size, such as locket-sized child locators, wristwatch-sized hiking navigation devices in addition to wireless phones and GPS-enabled pagers," says Kanwar Chadha, founder and vice president of marketing for SiRF Technology, Inc.

Emergency services are a major driver of investment in location technology. Wireless phones and networks will provide precise caller locations to emergency assistance providers. In addition, some car manufacturers are installing emergency alert systems combining wireless phones and location technology. When an accident occurs, the device automatically contacts the emergency assistance provider and sometimes the nearest hospital's emergency room. Another service being rolled out next year in the U.S. can help parents keep track of children, pets and people who need assistance.

Location technology has many commercial applications, including fleet and package tracking. Carriers may also generate revenue by offering flexible billing that is location-specific. Billing by location would provide carriers with the flexibility of offering rate choices to customers to encourage them to use their wireless phones in their homes or offices-increasing minutes of use and competing with wireline telephones.

Wireless location can also be a valuable tool for the planners and designers of wireless networks. System planners who know exactly where a wireless phone is located when a cell site is handling a call can position cells more efficiently and effectively. Fraud detection and prosecution can also be enhanced by utilizing location systems to lead authorities to illegal users.

Market development
The Federal Communications Commission (FCC) set deadlines for E911 compliance, driving the need for location services in the U.S. Japan, Korea, Portugal, Germany and many other countries are introducing new location services to appeal to their mobile populations. The time is ripe for new applications, and many companies are already placing their bets with new players entering the location market almost every week.

Software developers are initiating new location technologies and applications. NeoPoint, a smart phone developer, recently announced a location- based wireless portal which integrates wireless devices with the Internet, while SignalSoft has introduced a location-based wireless data solution. "Our product pulls the location out of an IP-based call, so it allows network operators to know where callers are and localizes the information they receive," says Flolid.

SiRF is now providing GPS-based location technology for autonomous as well as network-assisted location. "Our vision is to bring location awareness to virtually everything that moves," says Chadha. Chipset manufacturers are placing their bets on the importance of developing GPS-integrated chips. DSPC is teaming up with SnapTrack to produce cdmaOne and CDMA2000 chipsets which utilize wireless-assisted GPS technology.

Handset manufacturers are racing to meet location services requirements- adjusting antennae, batteries and size of terminals to meet the demands of this new market. "Qualcomm is including location technology at the chip level," says Anita Hix, Qualcomm senior manager, marketing communication. "We are working on products to meet the needs of our customers for low-power drain on the batteries, reasonable cost and fast service."

The wireless carriers, of course, have a major stake in location services. They are looking at these services as a way to differentiate themselves from their competition, expand their services to customers and open up new revenue streams. "One thing the Internet has proven to us-there is an incredible market for information," says John Yuzdepski, Sprint PCS vice president-product management and development. "The network operator owns the location information," says Flolid. "This market gives the carriers the opportunity to be more than just a pipe."

Another player in the location race is the Public Safety Answering Point or PSAP. These are the folks who dispatch emergency assistance to wireless callers, and need to know precisely where those callers are to do so effectively. The FCC is considering requiring carriers to negotiate the choice of technology they will use with each PSAP they serve. "What I want to know, before I choose a carrier, is whose technology solution will they use, how will they test it, and how will they go about implementing it so our service is not interrupted," says Eddie Ball, director of a PSAP near Atlanta, Georgia.

Choosing the technology
There are a number of technology solutions for location determination offering varying degrees of accuracy. The two primary classes of location technology are network-based and handset-based. In addition, software developers are now testing hybrids which utilize both.

Handset-based technologies rely on the Global Positioning System (GPS), a satellite-based radio navigation system operated by the U.S. Department of Defense. When a GPS receiver is added to a mobile unit or handset, the receiver collects signals from satellites in view and calculates the user's position, velocity, time and distance from selected points.

GPS is considered to be one of the most accurate location tracking methods, operating as it does in all kinds of weather everywhere in the world. However, it does have some drawbacks. Since the signals are transmitted by orbiting satellites, those signals are weak at the earth's surface and cannot penetrate buildings, mountains or wooded areas. Also, adding a GPS receiver to the wireless handset increases the size and weight of the unit and puts additional drain on the battery. "CDMA networks can provide very useful assists to GPS-based location technology," says SiRF's Chadha. "Since CDMA has very precise timing and frequency information, it is useful to narrow the search for GPS receivers." "GPS suits cdmaOne especially well," agrees Paul Washkewicz, general manager, CDMA business unit for DSPC. "CDMA already has GPS time and latitude/longitude readings sent to all handsets."

Tracking methods
Network-based location technologies include a variety of tracking methods. The angle of arrival (AOA) method determines when a signal from a handset originates and its angle from several cell sites. The location of the handset is determined from the point of intersection of projected lines drawn out from the cell sites at the angle from which the call originated. This technology requires a complex, precise array of antennae at each cell site. It works best with continuous signals, so is more difficult to use with digital transmissions. Also, as the handset moves further away from the cell site, accuracy is reduced. A recent field trial of angle of arrival technology in Minnesota showed that the application may be successful at meeting public safety requirements in a rural setting. The triangulation method or time difference of arrival (TDOA) determines the location of a handset by comparing the arrival times of the handset's signal as it is received by three different cell sites. The distance from the cell site does not affect accuracy nor does the power level. Time difference of arrival works well with different types of wireless devices since location can be estimated from either brief or long transmissions. And, because the timing is so precise, this method can estimate speed and direction of travel as well as position.

TruePosition Cellular has developed a time difference of arrival location processor that performs all of the location processing for an entire cellular or PCS system. It claims to find a location to better than 500 feet, most of the time.

BellSouth Cellular, meanwhile, is to conduct a market trial of a network-based location system designed by SigmaOne Communications which combines TDOA and AOA technologies to increase accuracy and improve coverage.

"CDMA provides a potentially greater level of accuracy both for network and handset-based technologies since it has a wider bandwidth and can reject a lot of interference," says Sam Samra, CDMA Development Group (CDG) location team member. U.S. Wireless Corporation has developed a Radio Camera system, which is a network-based system that uses multi-path pattern recognition to determine location. The system measures the distinct radio frequency patterns of the radio signals arriving at a cell site from a single caller.

Several hybrid solutions combining GPS and network-based technologies are being tested today. SnapTrack has tested a system which uses the wireless network to send an estimate of the location of the handset to a server. The server informs the handset which GPS satellites are in its area. The handset calculates its distance from all satellites in view and sends the information back to the server, where server software calculates the caller's latitude, longitude and altitude. The server can send these co-ordinates to a third-party service provider, a dispatcher or back to the handset. "We've con-ducted extensive tests for the past 18 months on CDMA networks, under guidelines developed by the CDG, and had very successful results," says John Cunningham, manager-marketing communications for SnapTrack.

Qualcomm is also introducing a hybrid approach, according to Hix. "It works with a CDMA base station and has a very high level of accuracy and better coverage than GPS alone. Calculations are made at the chip level, providing a very effective solution." "The network-based technologies have the advantage of providing coverage for the entire base of phones," says Bhaskar Srinivasiah, GTE Wireless manager for technical support. "But as standards change beyond the current version of CDMA, we don't know how the network-based hardware and software will evolve to accommodate those standards. The handset-based technologies provide much better location information, but would not cover the existing handsets."

Some carriers are considering the possibility of using different location technologies, depending on the service they want to provide. "For the bulk of our E911 commitments, we are looking at a network solution as the best way to cover all of the wireless phones, including analog," says Yuzdepski. "But in order to provide commercial services, we'll most likely be seeing GPS in every handset. We really have to wait and see how the technology develops."

Which brings us to meeting the need for E911. Ten years ago, when he first took over as director of Coweta County, Georgia's Public Services Answering Point (PSAP), Eddie Ball never dreamed that he'd need to learn so much about a complex array of technological solutions for transporting emergency calls and information. "About 15 to 20 percent of our 911 calls today are wireless," says Ball. "Our county is located on a major interstate highway. A lot of people who call us from the highway can't even tell us whether they are in Alabama or Georgia. " PSAPs report receiving more than 100,000 wireless E911 calls a day, a number they expect to increase.

In September 1999 the FCC revised its rules in order to help Ball and other PSAPs provide emergency services to callers using wireless phones. The purpose of the new rules is to allow handset-based location technologies to compete with network-based solutions. Phase I of the FCC's rules required that a dialable number accompany each 911 call-giving the PSAP dispatcher a number to call back if disconnected. It also gives the dispatcher the location of the cell site that received the call.

Phase II of the FCC's wireless 911 rules provides the dispatcher with more precise location information on the caller, called Automatic Location Identification (ALI). The FCC's latest revisions allow wireless carriers who use a location technology (such as GPS) which requires new, modified or upgraded handsets a period of time to phase in deployment. The FCC has also stated that an ALI technology that requires new, modified or upgraded handsets must conform to general standards and be interoperable to allow roaming among different carriers.

The most immediate deadline for wireless carriers is Oct. 1, 2000, when they must report to the FCC their plans for implementing Phase II, including the technology they plan to use.

Wireless emergency calling is really an international issue. Travelers to foreign countries who pack their wireless phones, also want access to emergency help. "If I have a seizure while I'm traveling in Japan, and someone picks up my phone to call for emergency help, will it work?" asks Jeff Crollick, director of wireless technical industry relations with SCC Communications. Crollick is chairman of an ad hoc group of the TIA's wireless communications standards committee which is studying the internationalization of E911. "We are developing requirements to enable a wireless phone to identify an emergency call, notify the switch and send it to the appropriate emergency assistance provider," says Crollick.

There are a number of challenges associated with location technologies including improving the accuracy and the in-building performance. Network-based solutions will probably require investment in additional antennae at a time when communities are zoning against them. There is also the issue of how the handset-based technologies will cover current wireless users and offer small handsets at reasonable cost. And finally, how will the different technologies enable interoperability to provide emergency coverage anywhere? "For consumers, the number one driver has been the up-front price they have to pay for the handset," says Yuzdepski. "If we load the terminal device with location technology, there will be upward pressure on prices."

The carriers are currently faced with the major challenge of choosing technologies in a market in its infancy. "We are still trying to understand the requirements of the marketplace, so it is not yet clear which technology will meet those requirements," says Gorelick. "Of course we will meet the FCC deadlines, but we don't know whether the technology we choose to do that will be our technology of choice in the future."

Requirements
Many carriers are also faced with the challenge of selecting one solution that will work with all of their technology platforms," adds Samra. Samra's CDG location team is trying to help carriers determine how to satisfy the FCC's Phase II requirements for CDMA, develop common test criteria for technology trials and share the information learned in those trials.

Liability and individual privacy rights have been a concern; President Clinton recently signed legislation on E911 which establishes liability protection for carriers. The law also allows calls to be tracked in non-emergency situations-but only if the subscriber has provided written approval. Consumer education is another challenge for the industry, especially in the area of emergency calling. "The key to effective consumer education is to have the different interested parties all sing the same tune," says Gorelick.

Finally, there is the challenge of determining just what the value of location services will be, and how that translates into meaningful revenue streams. "We need to determine whether location is the content or whether location adds value to the content," Gorelick said. "What exactly can we offer consumers that they will want to continue to pay for once the novelty wears off?"