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Facebook Enters Location Based App Space With ‘Places’

Facebook announced yesterday that they have officially entered the LBS market with their release of ‘Places’, which is expected to compete immediately with the business models of Foursquare and Gowalla. Largely built on Microsoft’s Bing Maps architecture, this release is also a threat to Google’s dominance in the map-based application space. “Check-in Fatigue”, a phrase that has become more and more common recently, seems to be the biggest hurdle ahead of these LBS providers; convincing current users to keep interacting and enticing new users to join will depend on a combination of the relationships these companies are able to build with brands and retailers, and the resulting benefits or discounts that are tied to frequenting each location. Another major hang-up are privacy concerns, and although Facebook promises to have put major development effort behind improving these issues, many users remain skeptical. The ACLU of Northern California has been one of the first groups to step forward on the current issue, saying that “Facebook made some changes to its regular privacy practices to protect sensitive location-based information, such as limiting the default visibility of check-ins on your feed to ‘Friends Only.’ But it has failed to build in some other important privacy safeguards. In the world of Facebook Places, ‘no’ is unfortunately not an option. Places allows your friends to tag you when they check in somewhere, and Facebook makes it very easy to say ‘yes’ to allowing your friends to check in for you. But when it comes to opting out of that feature, you are only given a ‘not now’ option (aka ask me again later).” This has been raised as a key issue in the past with Facebook apps, and their management are adamant that with ‘Places’ these problems with user privacy have been solved with the use of “opt-in” functionality. All privacy issues aside, Facebook has just entered a new space with over 500 million active users in tow, which compares to a little over 2 million currently on Foursquare. If they are able to combine the Facebook social experience with meaningful rewards for LBS users, then we have entered a whole new realm of social media where monetizing a user base just became a whole lot simpler.

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