VentureBeat

While even the popular social networks nowadays aren’t making that much money (Facebook expects to make $350 million in revenues this year), the burgeoning field of mobile social networks could be big business shortly, a new report by ABI Research indicates. Specifically, location-based mobile social networks could earn revenues of $3.3 billion within five years.

This is great news for many of the location-based mobile networks out there now such as Whrrl, Loopt, Where and Plazes. Each of these networks have garnered various amounts of buzz recently; Whrrl, Loopt and Where thanks mainly to the iPhone 3G launch and Plazes thanks to its sale to Nokia. But there is still some question as to how this money will be brought in.

The most direct means of making money will likely be licensing and revenue-sharing models with the wireless carriers and handset manufacturers, ABI concludes. Loopt, for example, has deals with all of the major carriers in the U.S.

But more interesting (and potentially lucrative) could be an area that the report notes “holds a lot of promise” — location-based mobile advertising.

A source close to Loopt told us last month that a driving force behind its deal to make the use of GPS data more cost effective was that it is working on an elaborate location-based advertising system. The company is apparently putting a lot of stock is such a system taking off.

These location-based social networks should soon face serious competition from the current social networking leaders such as Facebook and MySpace. While the mobile upstarts may have a lead out of the gate with location technology, the more traditional social networks have huge advantages in terms of overall users. Adding a layer such as location on a mobile version of these sites is less challenging than building an entirely new user base, as Silicon Alley Insider notes.

[photo: flickr/pinkbelt]

Plinky, the secretive service that can right now only be vaguely described as a social content encouragement startup, is getting less secretive. It finally has a website. (Well, a place-holder for one anyway.) And now it’s making a high-profile hire.

Today the company brings on board Ryan Freitas as the director of product design. If you don’t know the name, you know the work. Freitas (pictured below) was the director of experience design at Adaptive Path up until today, his last day with the company. There, he just finished leading the MySpace redesign project and before that he helped build Plazes. Plazes was acquired by Nokia in a high-profile deal a few days ago.

MySpace was arguably the ugliest big time site on the internet. Freitas managed to make it look mildly presentable (its homepage anyway — he unfortunately can’t change user taste on their own pages), something which I never thought could be done. Plazes has looked great from the start; and so this hire intrigues me.

But then, we were already intrigued by Plinky; not only because of its secretive nature, but also because of its pedigree. One of its cofounders, Jason Shellen, was an original member of the Blogger team who went over to Google with its acquisition. There he helped start Google Reader, the service’s popular RSS feed reading program. The other cofounder, Simeon Simeonov, was formerly the chief architect of Macromedia and is now a partner at Polaris Ventures, which led Plinky’s recent $1.5 million first round of funding.

Most services tend to work on manipulating and presenting your content once you put it out there. As I understand it, Plinky wants to help you find motivation to create that content in the first place. I have no idea how it plans to do this, but that idea excites me.

We’ve been told we’ll get a preview when the service is ready in “a few months.”

[photo of Freitas from his blog]

Nokia, the world’s largest maker of mobile phones, has agreed to acquire the Swiss-German start-up Plazes, the companies said in a statement today.

Plazes, based in Berlin, Germany is a service that lets you share your location and leave a brief message — akin to Twitter — about what you’re doing. Your message is placed on a map. In other words, it’s like Twitter, only with the added feature of location tags. Plazes’ most recent version actually integrates Twitter into its service entirely.

The move comes at a time when location-based services are all the rage.

The arrival of the iPhone and other devices using location (GPS) technology is spurring the development of numerous applications that exploit a user’s whereabouts to provide useful services. Various writers have recently opined at VentureBeat about location-based services (here and here). In fact, at this point, it may be over-hyped.

Plazes has 13 employees.

The acquisition is part of Nokia’s effort to bulk up on its social presence and time-based activity planning features, it said. It also is a sign that Nokia doesn’t want to cede too much ground on cool location applications to players such as Apple (Plazes had written an application for Apple’s iPhone recently), which has forged close ties with other similar services (location-based social network application Loopt was demonstrated during Apple CEO Steve Jobs’ keynote earlier this month). In 2006, Nokia also acquired Berlin’s Gate5 for a rumored $250 million, according to Techcrunch, and turned the product into Nokia Maps.

Another mobile social network, Zyb, was acquired by Vodafone recently for a rumored $48 million, or much more than the $25 million Zyb was seeking to be valued by investors when it was searching for a round of financing earlier this year. European investors had passed on Zyb at the time, reportedly doubtful about the promise of the LBS market. We’ve heard that Plazes was similarly under-appreciated until recently.

Nokia is building GPS into its newer handsets, so this make sense.

Carriers are getting active too. VentureBeat has learned that Verizon made a minority investment in both Loopt and popular GPS-based mobile phone navigation application, Networks in Motion.

Despite the Nokia deal, Plazes’ iPhone application is still said to be a go. It will be available in the iPhone App store when the iPhone 3G launches in July. Going forward however, one has to wonder if it’s in Nokia’s best interests to have a Plazes app on the iPhone. After all, Apple is positioning itself to be a major rival to Nokia with the worldwide launch of the iPhone in over 70 countries.

Other players in the social LBS arena include Brightkite and Whrrl. Who knows, Twitter may even get its act together and jump into the location game.

No financial details were disclosed on the Nokia-Plazes deal. Plazes raised about 3.7 million euros over two round.

[MG Siegler contributed to this article.]

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There’s smoke, there’s fire, and then there’s a volcano the size of Olympus Mons on Mars erupting and turning the ground into an ocean of burning lava. Such is current state of speculation surrounding the 3G iPhone.

There’s really no point in beating around the bush at this point. The new iPhone is coming on Monday. You know it. I know it. We all know it. If Apple were not to announce it at this point, it would be perhaps the largest letdown in the history of the company. That simply won’t happen.

If you still have any doubts, look no further than some of the rumored 3rd party announcements that are beginning to trickle out as we approach the WWDC. What do a lot of them share in common? They are location-centric. While the current iPhone has location recognition capabilities for its Google Maps application, it is GPS technology that will be needed to be the lifeblood for these apps. The current iPhone does not have GPS. The new one almost certainly will.

We’ve already written about Whrrl, a location-based social network that was the first application to be accepted by Kleiner Perkins’ for the $100 million iFund. Is there really any question that this was built to use GPS?

Yelp is also apparently working on a native iPhone application that will be location-driven, according to CNET. This could be a game-changing app because it will utilize Yelp’s already expansive list of local establishment ratings and reviews and serve them to you automatically based on where you are. The application will be able to do this thanks to GPS.

There will be others as well. Brightkite, Loopt, Plazes, FireEagle — all of these are likely to be important, if not major, players as location technologies become more mainstream. Given the iPhone’s elegant user interface and great usability, it is likely to be the device that will lead the way. It just needs that GPS chip. And it will get it.

Twitter is the current leader in the micro-blogging/micro-messaging sphere, but if it doesn’t act soon to offer some sort of location capabilities, it will get left in the dust. Is anyone going to want to type out their location, when your phone can send it automatically for you? This could be something to watch for in the coming months as Twitter will likely be bogged down trying to fix its architectural problems.

The GPS-enabled iPhone is coming — is your application ready?

For more on location technologies, check out the post by Eric Karr, the vice president of location technologies at Loopt, on TechCrunch.