Location-based services continue to roll out left and right. TechCrunch won’t stop saying this year’s South By Southwest conference will be all about location (except for this contrarian piece by Paul Carr). We mostly agree.

But with all the start-ups crowding the space and rapidly growing, albeit from a small base, Facebook looms as the category killer. With 400 million global users (100 million of them active mobile users), it could have quite an impact when it inevitably “turns on” geolocation for status updates.

There’s been speculation about when it will do this, including here. But today, the first tangible signs were shown in a New York Times Bits post that quotes unnamed sources within Facebook. The venue for the launch will not surprisingly be the annual F8 developer’s conference in April.

The update will involve some form of automatic geotagging for the status updates that have become the main dish of the social network. Like Twitter has done with its API (and today on its own site), this will automatically append status updates with location.

This will be based on GPS, Wi-Fi triangulation, IP address, explicit notification (think Foursquare-like check-ins) and/or users’ account information. Like Facebook’s recent regulation of status updates, it will also undoubtedly be governed by users’ opt-in privacy settings.

That last part is critical, and involves one of the reasons Facebook has taken a relatively long time to do this. With a company like Facebook that has all eyes and forms of scrutiny on it (especially being a social network), nearly all moves are met with privacy backlash.

So with new feature rollouts, it’s one step at a time to not rustle too many feathers. And of course location tagging is at the top of the list of privacy advocate seething factors. We’ll see what this eventually entails, but for now you can be sure that when location gets turned on, it will be huge.

The third-party apps and sites that utilize Facebook Connect will plug right into this, and there will be lots of implications for the local space. The Times agrees, stating this will be less of a threat to the Foursquares of the world than to Google’s local efforts — an area Facebook as been eyeing for a while.

One of the people familiar with the project said the company was not trying to beat the smaller location-based social networks, such as Loopt, Foursquare and Gowalla.

Instead, Facebook wants to go head-to-head with Google in the fight for small-business advertising. Facebook redesigned its business pages last year, with the hope of offering more features for small-business owners. According to Facebook, the Web site currently hosts more than 1.5 million local businesses from around the world.

I had the opportunity to speak with Michael Pastko, CEO of Coupious a Boulder, Colorado-based mobile coupon platform. Coupious got its start when Pastko and his partner leveraged their experience at Purdue University to launch a Coupious iPhone application in Lafayette, Indiana. While the duo did very little marketing, word-of-mouth marketing helped push their mobile application to potential users. Push seems to be the operative word with Coupious since its model does not push coupons to people based on their geography, but rather allows people to seek on-demand the just-in-time promotional offers relevant to them when they want them and where they want them. Many of its initial customers utilize the platform to run multiple promotions or post “just-in-time” offers to get rid of seasonal items or to push specific menu items.

“In order to win over local businesses, the goal was to replicate the print coupon model to help make it familiar and comfortable to select,” says Pastko. However, unlike print coupons, mobile promotions on Coupious can track the number of impressions, what promotional offerings are performing better and most importantly where impressions are taking place. As Pastko points out, “being able to locate where people are downloading or viewing promotional offerings allows advertisers to understand if consumers are looking at the point of sale, responding to an outdoor billboard, or are in areas of town that might offer new potential for the business.”

While college towns in the Midwest have been a successful launching ground for Coupious, traditional media groups such as newspapers have become the major focus in the past 12 months. Pastko has been careful about his growth plans seeking markets where Coupious can gain a high density of coupons and promotional offerings. “One of the biggest success factors is having enough content to make the application useful. Just like directories, if the restaurants and entertainment venues people expect to see are not in the database of offerings, then people’s desire to use the application decreases significantly.” Coupious’ model is not to aggregate coupons or scrape the Web for other offers, but to deal directly with the advertisers in the market. Pastko is quick to point out that “this gives consumers confidence that this is a legitimate offer and will be honored locally.”

When asked if the recent surge in coupons is a trend born out of the slow economy, Pastko said “coupons and promotional offers are in a trend phase now but the space is going through a transformative revolution where offers will not simply be coupons but will become promotions embedded within key messages making them more relevant and highly geotargeted to the users location. The mobile platform is the ideal device to deliver just-in-time offers, reaching people where they are and when they have a specific need. It’s up to mobile coupon companies to continue to innovate and embed offers within other media to further increase adoption and usage.”

The Coupious application is currently available on the iPhone and Android platforms with work under way to broaden to other application platforms.

Three years ago, BIA/Kelsey created the Marketplaces research program and conference because we saw that local advertising was quickly “verticalizing.” Indeed, money and talent have poured in for the new breed of vertical products that would take their place among existing vertical success stories, such as AutoTrader, Cars.com, Realtor.com and ServiceMagic.

The Marketplaces 2010 conference reveals just how fast the industry has evolved. This year’s event, now under construction, is set to highlight all the major trends in Marketplaces, including:

• AOL’s $50 million investment in Patch.com, and ongoing transformation of its Mediaglow vertical properties (and Mapquest)
• eBay’s renewed efforts to build up classifieds as entry-level e-commerce via Kijiji, eBay Motors and other services
• Examiner.com’s  big bet on local/vertical content, and its network of 26,000 “examiners.”
• Groupon’s “smart mob” theory of local commerce, backed by a $32 million investment, that allows hundreds to make a volume purchase of local services and products.
• Redbeacon, AlikeList and others’ efforts to remake ServiceMagic-like home and trade leads with social media
• Adify and Pulse360’s  bid to verticalize ad networks for local merchants and national brands
• OpenTable’s big bet on mobile to let diners make reservations wherever they are.

The two-day conference takes full advantage of its location in sunny San Diego. It includes rich research presentations, top-flight demos of the latest services, and a preconference showcasing all the best tools of Marketplaces 2010. Come to San Diego March 22-24 to learn, enjoy the unbeatable networking and participate. You can register at early-bird rates here.

CONFIRMED SPEAKERS (in Alpha)

• Ethan Anderson, CEO, Redbeacon
• Jeff Beard, CEO, Localeze
• Rick Blair, CEO, Examiner.com
• Jon Brod, EVP, AOL*
• Craig Donato, CEO, Oodle
• Jim Delli Santi, CEO, AlikeList
• Todd Dubner, SVP, NCI
• Russ Fradin, CEO, Adify
• Krista Glotzbach, VP, Vast.com
• Mark Goldstein, Chairman, Loyalty Labs
• Martin Herbst, GM, Kijiji U.S., eBay
• Scott Jampol, Senior Director, Marketing, OpenTable
• Jaan Janes, CEO, Pulse 360
• David Kidder, CEO, Clickable
• Steve Larsen, CEO, CallSpark
• Andrew Mason, CEO, GroupOn*
• Colin Pape, CEO, ShopCity
• Ben Saren, CEO, CitySquares
• Craig Smith, President, ServiceMagic
• Mat Stover, CEO, Local Matters
• David Vazdauskas, President, Local Thunder

*keynote

Neil Budde of DailyMe and Mike Orren of Pegasus News helped the ILM:09 audience understand what it takes to offer a truly customized news offering that is engaging and relevant.

One of the key takeaways both Orren and Budde discussed was the idea that not everything can or should be customized on the news site. Orren pointed out, “if we customize too much for the customer we take away those items they might stumble upon and become interested in following in the future.” Early days of customization meant sites were built and rebuilt for users as their choices and interests changed, requiring more administration and oversight to make things work effectively. One of the side effects of too much customization is that people were not aware of the level of customization, which took away from users promoting the value of the site to others.

Behavioral tracking is a necessary level of customization as people often say one thing and their behaviors might suggest another. Orren joked that “some people say they like champagne and opera then do searches on cheap beer and honky-tonks.” Without behavioral tracking the site would not have the flexibility to react and adapt to new interests. Budde added “there needs to be a mix of traditional editorial that is constant with personalized choices and behaviorally driven content to make it relevant and valuable.” Behavioral targeting is also valuable in advertising delivery not only for consumers to see items of interest but in more specific targeting for advertisers to reach those who might be more engaged in their products or services.

Orren pointed out, “the goal is to reach those consumers with high levels of interest and engagement to drive more value to advertisers in the way of sign-ups, redemption or attendance.”

Editorial content is one of the greatest drivers and one of the greatest cost issues for localized new sites. Data analytics is becoming a significant tool in helping to identify content trends based on what people are searching for and what they might be reading.

“DailyMe analyzes topics of interest and queries to determine editorial gaps to drive editorial focus or the need for additional freelance writer support to meet emerging needs,” Budde said. The reality of making a hyper-local news site work is a small dedicated editorial staff that not only creates new editorial but can be the aggregators of relevant news from other resources or local bloggers who are viewed as content experts.

The trend in news is definitely focused on delivering personalized content and local information in a single location to make it relevant and easy to access. The goal is to strike a balance between what consumers ask to be shown and what might be of interest either at the moment or what might be an emerging interest.

We’ve written in the past about location targeting: how the capability in mobile devices is starting to show the way for what we can likewise do on the “wired web.”

The Wi-Fi positioning made popular in the iPhone (care of Skyhook Wireless) is entirely possible for online search as well, given that hardware requirements — Wi-Fi — are also ubiquitous in laptops.

Next, of course, comes the software — something to take the Wi-Fi signal and make sense of it. This can take many forms including downloads and plug-ins (see Skyhook’s Loki).

But for users, these require an extra step, tantamount to adoption barriers — especially in a mass market sense. More automatic location awareness that’s “baked in” to the browser has been one solution: We’re already seeing this through Mozilla’s Geode and similar efforts with Google’s Chrome browser.

But it can go even deeper — namely, the operating system. We’ve heard rumors that Windows 7 will come with location awareness. Not to be outdone, similar rumors have surfaced that Apple’s upcoming OS Snow Leopard will have location awareness as an extension of its existing relationship with Skyhook on the iPhone. Makes sense.

Of course, this only provides the foundation. Local search applications still have to be built that utilize this capability and serve content based on exactly where users are. Yahoo’s Fire Eagle is based on this concept. This could also have implications for push-based advertising where display ads are targeted based on where users are — something that 1020 Placecast has begun to pioneer.

In other words, picture banner ads that have specific promotions for the Home Depot down the street, rather than the general impression-based banners we know all too well. The location relevance and specific calls to action will increase engagement and performance (clickthroughs, conversions, etc.).

For many, this will be a welcome evolution from the relatively blunt state of the art: IP targeting. But it will take a while for Madison Avenue to catch on, and for new ways of thinking about ad unit production (i.e., creative) to materialize. More importantly, users have to buy in first, and we’ll hear a lot from privacy advocates.

So the capability will need to be opt-in, and we’re confident it will get more user acceptance through positive reinforcement that it does actually increase relevance. This is a learning curve/comfort issue that we’ve seen play out with lots of online advertising (contextual, behavioral, etc.).

The advancements in the mobile world and the growth of the mobile Web could accelerate this adoption. We’ll also see faster acceptance among younger age groups. There will indeed be lots of moving parts, but the gears are starting to turn.

Google seems to have a growing interest in melding location with social media. This has played out in lots of ways including last week’s launch of its Latitude mobile social product. The latest move comes with today’s integration of a location signature integrated into Gmail.

Users who turn on this function will have an auto-signature note that identifies their location (i.e., “sent from Mystic, CT”). Location will be determined by IP address but more precise location can be determined by Wi-Fi positioning, which requires downloading Google Gears.

This is conceptually similar to Yahoo’s Fire Eagle, which positions itself as a switchboard to provide location information to publisher partners that can use the location for more relevant user experiences.

As we’ve written, Wi-Fi positioning will soon be more omnipresent when it’s integrated into the browser. In the meantime, the extra step required to actively download tools (such as Google Gears or Skyhook Wireless’ Loki) will be a big adoption barrier to location-aware Web apps.

The location awareness already built into mobile devices, conversely, makes adoption more passive and frictionless than on the desktop. We’re likewise seeing a growing use case at the three-way intersection of mobile, social and local: Finding things to do, see or buy in the context of where my friends are and what they’re doing.

That’s where Latitude comes in, and the new Gmail location feature could somehow tie into it in the future. Until then, it’s more of a general correlation that points to Google’s interest in having location be an input in the factor that has defined the company’s products since the beginning: relevance (and revenue).

Social + mobile + local will be part of the discussion in the Mobile SuperForum at next month’s Marketplaces conference, where uLocate CEO Walt Doyle will be on hand to talk about what his company has done with the WHERE and Buddy Beacon mobile applications. Hope to see you there.

We’ve written a bit in the past about how location awareness in mobile devices like the iPhone is beginning to inspire online product development. This has been behind Mozilla’s Geode platform, which lets developers create location-based services based on the location awareness that will be baked into the Firefox Web browser.

The latest location aware application has come from Laptop Cop, a $50 security software product for laptops that lets you remotely erase data if a laptop has been stolen (TechCrunch write-up here). Its main feature brings in location awareness, care of Skyhook Wireless, to track and pinpoint the location of a lost or stolen machine. Think of it as LoJack for laptops.

There have been a handful of one-off applications that utilize the Wi-Fi positioning of Skyhook — like Skyhook’s own Loki (the dirty little secret is that Loki provides the same functionality as LapTop Cop for free). These apps mostly require developers to work with a geolocation API, and users to actively download or purchase them. Both factors have kept location awareness from getting off the ground.

But the aforementioned integration of location awareness into the browser (or the OS) will make it a much more saturated part of an online user experience. Once it’s there, developers will have a better ability to create local search apps that utilize location data. The idea is that users will also slowly accept it based on the positive reinforcement of its relevant content delivery — and the added exposure and appeal it’s getting under the iPhone halo.

Finally, these factors could lead to advertiser interest and the creation of ad units that dynamically target users based on where they’re sitting. This will require lots of moving parts, such as publishers and ad networks, but the upside is that higher georelevance could lead to better ad performance and CTRs. Placecast is already working on a similar targeting strategy (the company will speak at a TKG-run session at SES Chicago next week on local search).

This was also a hot topic during a panel discussion on Web 2.0 community sites at ILM:08 two weeks ago, and it’s the subject of a TKG report that published today. In other words, this is a topic that’s gaining steam and could have lots of applications for finding a cup of coffee, a flat screen TV or your stolen laptop.

148apps.com reports that there have been more than 10,000 iPhone apps released to date. The site tracks application releases and also has some interesting breakdowns of where applications fall into different categories and price points.

About a quarter of total applications are free, for example, while about 35 percent cost $0.99 (seems to be the sweet spot for paid apps). The average cost is $3.15, while all 10,000 apps would set you back about 30 grand. In terms of categories, games are the clear winner, not surprisingly.

Though local isn’t broken out specifically, many local apps fall into the “utilities” category (some are classified as lifestyle or travel), which ranks third at about 1,000 apps. More specifically, about 15 percent of applications utilize the location capabilities of the phone.

As we’ve said many times, local’s percentage of iPhone activity (and other next generation devices) will be a larger stake than its percentage of online activity. This has a lot to do with the use case of the device, conducive to finding things locally while out and about, and the fact that location awareness is baked right in.

We’ll be taking a closer look at mobile local search in ’09, including forecast data on mobile usage and mobile ad revenues. It will also be important to take a qualitative look at how advertising will evolve with mobile data consumption and usage patterns.

For example, we could see more CPA or transactional advertising in things like local shopping search (a hot topic this week). This could come about with increased access to store inventory data, and greater potential for promotions or coupons given that the device is with you at the point of purchase.

Picture standing in front of a store shelf and being able to get real-time price comparisons (and availability) from other stores across town. In our discussions with local shopping search companies like TheFind and NearbyNow, this is precisely how they’re thinking. These types of mobile search utilities in retail and many other local categories could see a lot more development and commercial interest in ’09. We’ll be watching closely.

Mashable is holding its second annual Open Web Awards and voting is open until Dec. 15. You can vote for one company in each of the 26 categories, such as social networking, photo sharing, search & social search, etc. (full list here).

But my biggest question is, where’s local? Among 26 categories, there is no local search — not even mapping. There are some local sites like Yelp and Center’d that are scattered throughout other categories, but shouldn’t local get its own category? The omission isn’t commensurate with local search’s exposure (Google Maps, Yelp, iPhone apps, etc.), market opportunity (our data), and overall usage.

This reminds me of Sebastien Provencher’s mission to get local on the agenda of next year’s South by Southwest conference where it was noticeably missing. Despite local’s actual impact and level of importance in the online world, sometimes, it’s like Rodney Dangerfield: Can’t get no respect. Maybe it’s just not sexy enough …

This could change as growing iPhone penetration garners more exposure for location-based search and content delivery. It’s already having an impact on online product development, with Firefox, Google’s Chrome and Windows 7 OS — all anticipated to have baked-in location awareness a la iPhone Wi-Fi positioning.

This was a hot topic during a session at ILM:08 on Web 2.0 community sites, and a TKG report will publish next week on the subject.

Lately, a portion of iPhone television ads have featured local search applications. The other day we pointed out the UrbanSpoon ad. Now there is an ad for Loopt, the social media app that lets you see where your friends are and what they’re doing (provided that they have the application).

As we’ve voiced our premise that local and mobile are inherently related, the thought is that local search will see a great deal of the product development that is taking off in the mobile world. Location awareness baked into the iPhone and other smartphones will be the key to that functionality.

The interesting thing about Loopt is that it adds a third dimension to the marriage of mobile and local: social networking. This three-way intersection of mobile/social/local is starting to get some traction. It makes sense because seeing where your friends are and what they’re doing has natural ties to local business search (i.e., “Where should we meet up?”).

Meanwhile Loopt has numbers to show for it. It’s currently ranked 20th among popular free iPhone apps, and is being downloaded more than both Facebook and MySpace, according to TechCrunch. In fact, Facebook is ranked 25, and MySpace, 43, despite the cross-promotional advantages they both have over Loopt.

Our past analysis of the mashup of mobile/social/local is here.