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Apple's iBeacon turns location sensing inside out

John Cox | Feb. 11, 2014
'Where am I?' becomes 'Here I am!' with Apple iBeacon technology.

Startup SnipSnap offers an app, with the same name, that lets iOS and Android users download or scan a coupon and then redeem it. The app ties into the SonicNotify backend. "IBeacon can do location-based monitoring without turning on [the battery-draining] GPS," says Ted Mann, founder and CEO. "And it can do fine-grained, accurate locating. We can now do location-based reminders indoors and that's something we couldn't do before."

Brilliant simplicity, daunting complexity
The pairing of the stand-alone beacon and the iPhone's BLE radio-plus-software-framework is a brilliantly simple stroke by Apple. It makes accessible millions of iOS users, while still giving them control over whether to participate in iBeacon deployments. But for retailers, while the network connection with these millions of users is simple, almost nothing else is.

"This is not a stick it on the wall and it works' scenario," says Sam Ganga, executive vice president, commercial division, DMI, a Bethesda, Md., company that specializes in managed services for enterprise mobility, coupled with analytics that can sift and assess a mass of mobile data. "You have to survey the store or venue, install potentially a lot of beacons, create a mobile app, capture the right information, integrate with backend systems, and have the analytics to understand the data you capture. It's not a small investment."

As a result, many retailers are actually proceeding cautiously, according to Ganga. Surprisingly, their initial interest is not in deluging users with offers. "What in-store location data really means is understanding customer behavior," he says. "When my customers enter the store, how many turn left and how many turn right? Will that affect what I put in my endcaps [the end-of-aisle displays and promotions]? The idea is monetizing this insight into behavior, and then showing customers how they can benefit from this data."

It's an idea that is drawing intense interest. Estimote, founded less than two years ago, targets its beacons and software development tools, and programming services, to integrators and enterprises experimenting with beacons. It released its beacon software development kit in September 2013: 10,000 developers have downloaded it, according to Mark Modzelewski, an investment adviser to the company, founded in Poland, with U.S. offices in Walnut, Calif. Experimenters include big box and boutique retailers, marketing and advertising companies, museums, and medical centers.

iBeacon and mobile payments
Many now believe that iBeacon will be a key part of an Apple strategy for mobile transactions. "We feel strongly iBeacon will be part of a mobile payments plan," says Walter Chen, CEO of PassbeeMedia, a startup that offers online software tools that let developers create, distribute, and manage "passes," which is Apple's term for an array of digital documents coupons, loyalty cards, receipts, boarding passes and the like.


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