A LugLoc spokesperson said the location accuracy issue relates to how the device uses GSM tech, and it isn’t always as accurate as, say, a GPS device. But as noted, GPS would quickly zap LugLoc's battery. For me, the tradeoff is worth it, because the GSM network worked just fine in locating the LugLoc device in my bag at JFK and SFO.
If you frequently check a bag and make connecting flights, and you're quite ready to shell out cash for a newfangled "smart bag," LugLoc is worth a look.
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