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The GPS Revolution: Location, Location, Location

Never before was there such power in answering one simple question: "Where am I?"

With its handy replies, the Global Positioning System, or GPS, is changing a growing number of enterprises and is on the verge of altering many more. Shipping, shopping, health care, law enforcement, and farming are just a few of the fields that have been transformed by the location-finding technology in the past few years. The market for GPS products and applications is expected to hit $75 billion by 2013, according to market researchers RNCOS.

GPS started like a lot of other technologies: It was invented for military use. The U.S. Defense Dept. spent $12 billion on satellites and computers to track weapons and personnel as they moved. It began allowing others to use the tracking technology in 2001.

Early civilian adopters included farmers looking to maximize crop yields and surveyors marking boundaries on large tracts of land. In 2005 a more robust satellite system was launched, allowing GPS to facilitate today's explosion of applications.

Most of the GPS market—90%, in fact, RNCOS reports—was dominated by Portable Navigation Devices (PDNs) as of 2007. This encompasses vehicle navigation systems or personal units used for hiking, fishing, or mapping. By 2013, though, RNCOS predicts that 70% of the market will be based on use in cell phones. There's no better example of this than Apple's 3G iPhone (AAPL) and the App Store. With GPS functionality built into the iPhone and the open platform of the App Store, thousands of amateur software designers are continually cooking up new ways to exploit the market.

Giving Companies an Edge

The practical applications for GPS seem unlimited for business. Companies can track shipping fleets, which cuts down on wasted time, fuel, and pollution. Electronics makers are capitalizing on GPS to renew old products, like cameras that tag photos with coordinates or watches that track a runner's progress en route. Cities are creating GPS-based electronic tour guides to boost tourism. Restaurants are testing programs that beam ads only to people in the neighborhood.

Location-based technology has found a wide array of uses in the public sector, too, which means big bucks for the companies that supply GPS-enhanced gear. Authorities can monitor parolees or sex offenders by the GPS bracelets strapped to their ankles. Fire trucks can navigate through smoke or fog. Emergency workers can pinpoint people trapped in a collapsed building or forest. Police can track our stolen cars or bicycles.

There's also plenty of fun to be had. From social networking to scavenger hunts to photo tagging, GPS is connecting people and places for all sorts of activities. App developers are cashing in. Golf units that map the distance to the hole are shaving strokes from games. Finding the best fishing spots is as easy as punching in a few coordinates.

GPS seems likely to become ubiquitous. Though the U.S. system is free to anyone worldwide, the European Union, India, Japan, and China are all developing their own. Surely, they've seen what's possible.

Joseph is an innovation and design writer for BusinessWeek, based in the Chicago bureau.

Joseph is an innovation and design writer for BusinessWeek.

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