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Facebook Places lets users track friends and services

Mon, 08/23/2010 - 6:52am
(Reuters) - Facebook's 500 million-plus users will soon be able to track friends' whereabouts across the United States, as the world's largest Internet social network adds technology to increasingly tie its virtual world to everyday life.

The new "Places" feature -- which begins rolling out on Wednesday to some users and goes nationwide within weeks -- is touted as a tool to help users share where they are, figure out who is in the vicinity, and check out happenings and services within the same locale.

The addition of so-called location services to Facebook -- a move that industry observers have speculated about for months -- opens new revenue opportunities for the company, but also presents it with delicate privacy challenges.

"Places" will be accessible via an Apple iPhone app that Facebook designed from Thursday, or from the social network's own mobile version on touchscreen smartphones.

"This is not about broadcasting your location to the world, it's about sharing where you are with your friends," said Michael Sharon, product manager for "Places."

Users will be able to declare their whereabouts whenever they want, thereby opening themselves up potentially to offers, suggestions or advertisements about nearby businesses. Facebook on Wednesday said it had no immediate plans however to pursue such money-making opportunities.

Users can "check in" from their smartphones, broadcasting their location -- anywhere from a restaurant to a park -- to their own Facebook friends. Their whereabouts are then flashed through the network's popular status updates.

Users can look up the locations of friends who are similarly "checked in" -- either via updates or on a separate Web page -- or tag friends who happen to physically be with them, thus declaring where they are.

But with privacy in mind, Facebook will allow users to block "Places" functions as part of a comprehensive set of privacy controls and other safeguards.

The new services could help Facebook grab a bigger piece of a local advertising market driven by small businesses like restaurants and stores. The vast size of that market -- estimated in the tens of billions of dollars a year in the United States alone -- has attracted online companies like Google and Yelp.

The feature could let Facebook eventually target users with ads based on their location, or offer special coupons when a user nears a certain business, supplementing the $700 million to $800 million that Facebook generated in revenue last year, according to people familiar with the matter.

LOCATION, LOCATION

Location services like Foursquare, Gowalla and Loopt, which allow consumers to use their cell phones to keep track of their friends whereabouts and earn rewards for frequenting brick-and-mortar businesses, have caught on among technology aficionados.

Foursquare and Gowalla executives popped up onstage alongside Facebook on Wednesday, saying they will team up with the social network and tailor their own services to work alongside its "Places" feature.

Foursquare, one of the fastest-growing location services, has amassed 2.7 million users since its March 2009 launch and raised $20 million in venture capital funding in June. Facebook and Yahoo both unsuccessfully sought to acquire Foursquare earlier this year, according to media reports.

Whether location services appeal to the mainstream audience on Facebook however remains to be seen, particularly given the concerns many people may have about a service that reveals their physical location.

Privacy has been a persistently thorny issue for social networking companies, which must balance users' concerns about how much of their personal information is made public with the need to generate revenue by sharing information about users with advertisers.

In May, Facebook introduced tools to give users more control over what personal information is shared on its service, following criticism from many privacy advocates.

Google Buzz, a microblogging service for broadcasting short messages to friends and contacts, was faulted for lax privacy settings as soon as it launched in January, a stumble from which the service never recovered, say analysts.

"They want to make sure they've done their homework, because privacy does become a concern right out of the gate," said Michael Gartenberg, a partner at consulting and analyst firm Altimeter Group. "They don't' want to introduce this and then have to come back and fix it."

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