There is in my opinion only 1 LBS proposition the majority of the mainstream public would agree is valuable.

That value is the Traditional GPS “Directions” searches – Summarized it’s the “Search for an address or type of businesses/service/landmark/event and route me to that address from my current location” value proposition.

This is a proactive “pull information” use case where the user initiates and controls the entire LBS use case. In these use cases the users location is not being continuously broadcast for the consumption of other people or entities. Of course mobile operators do have continuous location information about their users phones, GPS enabled or not, but they are not, at least so far, in the businesses of making that information broadly available.

I don’t believe most people will feel comfortable having their location continuously tracked by numerous third parties without explicit control of every tracking session. Very few people, once they think about it, will want “electronic solicitors” approaching the user either electronically or physically as a result of the broadcast of the status of their locations.

While there certainly is a population of people who are comfortable with advertising their location broadly to other people and businesses in the context of social networking, that population is for the foreseeable future going to be, IMO, less than 10% of the adult population.