Location-based services subscribers to double in ’09

Gartner Inc. predicts that the number of subscribers using location-based services (LBS) globally will double this year, even as mobile device sales decline by 4%.

The analyst group said the number of LBS subscribers is forecast to reach 95.7 million by the end of the year, up from 41 million in 2008. Revenues associated with LBS will also more than double this year, reaching $2.2 billion, up from $998 million last year.

LBS allows users to find each other and supports mapping and navigation capabilities, usually through GPS, but also through cell tower location.

The expected increase is due to the availability of GPS-enabled wireless phones, along with reductions in prices for services and the growth in application storefronts that offer location-aware software, said Annette Zimmermann, a Gartner analyst.

Gartner also predicted huge growth in the number of users who opt to accept advertising in return for free LBS. Today, about 10% to 15% of LBS users take advantage of free services, but that number should grow to 40% to 50% in 2013, Gartner said.

The research firm also said that carriers who charge users up to $10 per month, plus the cost of a monthly data plan, for LBS can expect to lose customers who opt to take advantage of free services.