LBS services account for 51% of mobile revenue

It isn't social networking and it isn't text message ads. According to the latest information from Telephia, location based services (LBS) are the leader for revenue from downloadable mobile applications. LBS services accounted for 51% of the $118 million mobile ad dollars during Q2 2007.

by Kristina Knight

Location based services help users find information, friends and business locations and can include community areas and personal organizational tools.

According to the report 13 million mobile users downloaded a mobile application to their phone during Q2.

"There are hurdles that LBS publishers face, most notably the relatively low incidence of application downloads when compared to other mobile data activity. Many consumers may not realize the utility of a navigation application on their mobile phone until they use it," said David Gill, Director of Mobile Media, Telephia.

The report also found that there is still room to grow in the LBS department. According to the report LBS services have only penetrated about 5% of the market whereas games, ringtones and SMS have penetrated about 13% of the market. LBS is more expensive than other mobile applications. On average, LBS applications cost about $9.23 per month for a mobile users but pictures, sports information and weather applications cost only about $5.41 per user.