Smartphone Software Gets Smarter, More Interactive

Context-aware computing draws on vast amounts of data to help consumers buy from vendors that know more about them, too

By Rachael King

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Ellen Tanowitz has uncovered what may become the envy of every budget-conscious, working parent. She found a simple way to save time and money—while keeping a brood of kids occupied—as she shops for groceries at her neighborhood Stop & Shop.

Her secret? Tanowitz, an attorney from Newton, Mass., uses a hand-held device that lets her scan items the instant she takes them off the shelf; that means no more long waits in a checkout line. The scanner also knows her buying history and whereabouts in the store, and it uses that information to deliver coupons for the items she purchases most. (Her family loves cream cheese, for instance.) Best of all for this mother of three, the device is so easy and fun to handle that it keeps her children busy till shopping is done. "My kids fight over the scanner. They have to take turns because they all love to use it," she says.

Tanowitz owes her newfound savings of time and money to software that gathers vast amounts of information—not just a person's whereabouts, but also such data as interests, buying habits, even social circles. Known as context-aware software, the technology then harnesses that information to provide useful tools to the smartphone user. At Stop & Shop, that can mean money-saving coupons. In other settings, context-aware technology can provide crucial, at-a-glance background information about a business associate or prospective client. Or it may simply aid travelers in finding a place to eat or locating where they parked their car.

For years, technology has been able to pick up a person's location through Global Positioning System satellites that deliver up-to-the-minute traffic and mapping data. But only recently have electronics been able to put a person's location into a larger context. By 2012, the market for information about a person's context will rise to $12 billion, according to research firm Gartner (IT).

interactive scans: "Favorite Places"

Google (GOOG) is at the forefront of companies poised to benefit from this demand surge. The company already has access to loads of data on people and their Web searching habits. "Google knows more about most people than anybody else," says Anne Lapkin, a research vice-president at Gartner. "So they'll be pretty uniquely positioned to take advantage of context and monetize the information that they have." In October, the company released Google Maps Navigation, which provides turn-by-turn mapping for users of smartphones that run the Android operating system.

On Dec. 7, Google made another step toward integrating online and offline context, adding some 100,000 local businesses to its "Favorite Places" feature, which highlights the most popular places searched among users. Businesses added to the list will show up in Google Map searches; users with a camera-phone can go to the business and point the camera at a Favorite Places decal in the window. That opens a Web browser and lets them read user-generated reviews in their device's viewfinder. "What we're trying to do is to connect the real world with the vast stores of information about places in the world that exist on the Internet," says John Hanke, vice-president for product management for geo at Google. "We want to make it easy for people as they're out interacting with the world."

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