Telecom Timeout

Jun 30 2011   12:53PM GMT

Did another opportunity for location-based services just whiz by mobile operators?

Jessica Scarpati Jessica Scarpati Profile: Jessica Scarpati

A column in today’s Boston Globe highlights a new mobile app and service, Shopkick, which rewards consumers with points (or “kicks”) for entering, browsing or making purchases at retail stores that partner with Shopkick Inc. Consumers can eventually trade in their points for gift cards, movie tickets, designer jeans and even HDTVs.

Boston Globe tech guru Hiawatha Bray explains:

“One of Shopkick’s coolest features is based on some delightfully geeky technology. Drop in at Best Buy with the Shopkick app running on your phone. Walk through the door and wait for a few seconds. With a happy little jingle, the phone informs you that you’ve gotten 60 kicks just for crossing the threshold.

GPS signals usually won’t penetrate buildings, so how does it know where you are? Shopkick has persuaded Best Buy and other merchants to install a network of small speakers that broadcast high-frequency sound, the kind that’s too high-pitched for human ears. I don’t know whether dogs can hear it, but the microphone in a smartphone can pick it up. The sound tells the Shopkick app that you’re inside the local Best Buy, and so you get your reward. You can collect kicks this way once a day, so Shopkick gives users a reason for return visits.”

Shopkick, which is backed by Citigroup, is making deals left and right with not just big box retailers such as Target, Macy’s and Best Buy. But they’re also now offering free installation of their boxes to smaller local merchants, according to GigaOM.

No word on exactly how lucrative these deals with retailers are, but at the risk of sounding obnoxious: We told you so.

As we reported earlier this year, carriers could be delivering–and profiting from–these same kinds of location-based services using WiFi and small cells alongside partnerships with retailers and shopping mall owners.

Next-generation services are nothing without next-generation business models. What’s the hold up, telecom?

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