@ pcMobile 2011: Location Services Are Trying To Find The Right Place

There’s been a good deal of worry over geo-location services embedded in iPhone and Android phones, after it was revealed that Apple (NSDQ: AAPL) and Google (NSDQ: GOOG) could track users — but only for the sake of aggregating information on wifi hotspots and cell phone towers. Tom Krazit, Mobile Editor, paidContent and mocoNews, began the panel discussion at paidContent Mobile with a talk about the value proposition of these services, even with the threat of greater regulation.

Why is geo-targeting such a hot proposition for venture capitalists these days?

“You’re talking about a trillion dollar industry — this is about skipping over the cost-per-click and connecting consumers directly to e-commerce from retailers,” said Walt Doyle, CEO, Where, Inc.

Couponing and user reviews are also increasingly attractive parts of the business, said Soraya Darabi, co-founder, Foodspotting, which is a photo-based app that curates user reviews of restaurants.

“I think there is a model for click to navigate, like click-to-call,” said Kristi Crum, director, Consumer Solutions for Verizon Wireless (NYSE: VZ). “There is a power to that, as opposed to being bombarded by coupons when I walk down the street. It’s under-utilized right now, but that’s changing. Wal-Mart (NYSE: WMT), for example, is using location to see if you made it to the store. That is where the value is.”

So where is the trade off when it comes to consumer privacy?

Darabi spoke about the questions companies like Foodspotting have to ask themselves. “Do you notify through push notifications, which feels like work? We want to tell people that Tony Bourdain recommends the restaurant down the street,” she said. “But we’re not sure people want to know that.” Darabi noted that Foodspotting is a small company, so it can react quickly, and try different things, though it’s also important to proceed cautiously.

While the panelists did say that they are personally pretty open when it comes to using location-based services. Darabi did say she quickly rejected the photo-sharing app Color after a few days. “I wasn’t sure what it did with the photos I was sharing,” she said.