Facebook Inc., leaping into the fast-growing world of location-based services, is rolling out a feature for mobile phone users to broadcast their whereabouts and track where their friends are.
With the Places feature, users can also see who else has “checked in” at a museum, shop, park or movie theater, what they did there and what they thought of it.
The trend, which has caught on with the rising popularity of Internet-connected smart phones, may take off as the world’s most popular social networking site launches out the service to the more than 150 million users who access Facebook on mobile devices.
Facebook sought to head off privacy concerns by giving users control over what and how much information they share on the Places service. Users can remove themselves if someone tags them — or disable the feature altogether.
Online services that pinpoint a user’s location tread on sensitive territory, with one watchdog questioning how Facebook plans to use the location data it collects. But analysts say Facebook seems to have learned from the controversy that erupted this year when it nudged users to share more information publicly.
“The main thing we are doing is allowing our users to share where they are in a really nice and social way,” Chief Executive Mark Zuckerberg said at an event at Facebook’s Palo Alto headquarters. “You can see who is around you and connect in the real world.”
Its Silicon Valley rival Google Inc. has already staked a claim with its own location service and is in the process of building a social networking service to compete with Facebook rumored to be called Google Me. Both companies are keenly pursuing the potentially lucrative location-based market, which remains largely up for grabs.
Advertisers are eager to target consumers based on their location by sending coupons or special offers to people near specific stores, bars, movie theaters and restaurants. That mobile advertising market could grow to $3 billion by 2014, up from $200 million this year, the consulting firm Borrell Associates predicts. But checking in has not yet become mainstream. Forrester Research reports that only 4% of adults in the United States use location services.
“With Places, Facebook hasn’t rewritten the social media world, but it might just rewrite the way people think about social networks,” said Forrester analyst Augie Ray. “Soon the local restaurant or hiking trail may have as rich a personality as do the people on Facebook, not because everyone has visited but because your friends have. And in the end, isn’t that what we really care about?”
Facebook borrowed the idea from several companies that pioneered location-based services. Its entry into the market is likely to increase pressure on these smaller companies. The frontrunner, New York-based Foursquare Labs Inc.; Austin, Texas-based Gowalla Inc.; and San Francisco-based Booyah Inc. are working with Facebook to offer their features to Facebook users, but will have to differentiate themselves from Facebook’s service to maintain their appeal.
Facebook’s service could eventually help the Palo Alto company rake in more advertising dollars and heighten competition with Internet giant Google.
With a touch of a button, smart-phone users can now alert their Facebook friends that they are at a restaurant, theater, bar or museum. They can “tag” friends who are there with them and broadcast their location on Facebook.
The service began rolling out Wednesday to users in the United States.
Zuckerberg declined to say how Facebook would make money from the service but said the service may eventually include advertising.
If the service works as Facebook hopes, it will increase how much and how often people share on Facebook while giving the company even more insight into its users’ interests and whereabouts. And that could help Facebook draw interest from even more advertisers.
Advertisers are flocking to Facebook, which could bring in as much as $1.4 billion in revenue in 2010, up from $800 million last year.
Facebook is widely viewed as a competitive threat to Google, with the companies jockeying for eyeballs and dollars on websites and mobile phones. The more time people spend socializing with friends on pages that Google’s search engine cannot crawl, the less time they tend to spend on the company’s products and clicking on its ads.
Ray Valdes, an analyst with Gartner Inc., said Facebook is smart to roll out the service slowly.
“It’s a case of build now, monetize later,” Valdes said. “They don’t need to monetize right now.”