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Gartner: Context-Aware Technologies will affect $96 Billion of Annual Consumer Spending by 2015

November 1, 2011

Healthcare and other industries stand to gain considerable efficiency from context-aware computing, with notable use cases and case studies emanating from location and presence-enhanced applications.

Context-aware technologies will affect $96 billion of annual consumer spending worldwide by 2015, according to Gartner. By that time, more than 15 percent of all payment card transactions will be validated using context information.

Gartner analysts discussed the growing importance of context-aware computing at Gartner Symposium/ITxpo, recently in Orlando, Fla.

“Context-aware computing is the method by which new experiences are constructed that blend information from mobile, social, digital and physical world sources,” said William Clark, research vice president at Gartner. “The disruptions caused by context-aware computing will include major user, technology and business shifts, including the use of model-driven security in fraud detection and prevention, convergence in television, game, Web and mobile advertising, and new styles of application programming. The advanced use of personal information in customizing user experiences will result in the interest of governments in regulating contextual information access and control.”

Gartner estimates that by 2015, 40 percent of the world’s smartphone users will opt-in to context service providers that track their activities. Given the overall smartphone base, this equates to about 720 million people or about 10 percent of the global population. Payment card issuers and retailers currently hold important transactional information per person, and social platforms such as Facebook can provide some influence, but the ubiquity of the devices and the convenience of context-enriched services mean that although those providers are sources of context, they cannot deliver “the last contextual moment of choice.”

However, by 2015, smartphone adoption of iOS, Android, Windows Phone and other smartphone platforms will stand at more than 1.8 billion people. This collection of vendors already possess vast amounts of information about the digital habits, and by 2015, the intent of users will be combined with further enhancements of both indoor and outdoor 3D mapping databases. This will mean that context providers will be able to use location as a foundation to allow them to redefine how consumers search for and pay for products and services. This will present a new set of opportunities, and a change in the positioning of financial service providers, consumer packaged goods companies and retailers.

“Enterprises can leverage context-aware computing to better target and deliver on the promise of increased customer intimacy for millions of consumers,” Clark said. “For CIOs, the timing of investment in context-aware computing will be critical. Organizations that do not prepare for thoughtful information sharing — balancing usage, privacy and business models of consumers, context providers, and the enterprises themselves, will be at a severe disadvantage. Organizations will need to coordinate in how context-enriched services will change their physical store, e-commerce and mobile-user experiences. Investing too heavily, too early will squander IT, marketing and operational resources.”

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