Last updated
January 3, 2024

Geolocation Data Explained: Definitions, Use Cases, Collection Methods, and Limitations

Paul Korzeniowski

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Where am I? Nowadays, individuals have that location information in their living room, on their smartphone, sitting at their desk, in their car, and hiking in the woods. A wide and growing variety of devices smartphones, fitness monitors, and desktops and laptops include geolocation tracking technology, which pinpoints where a person or item is just about anywhere in the world at any time. That information, which is made available via geolocation Application Programming Interfaces (APIs) and associated algorithms, helps individuals and companies reach their desired destination, meet their fitness goals, track product shipments, provide information to social media applications, and find needed resources, like a gas station or a place to eat.  

The applications’ impact can be dramatic: “Geolocation data storage is a game-changer for businesses seeking to enhance efficiency and improve resource allocation. By harnessing the power of this technology, companies can optimize routes, personalize customer experiences, and bolster security measures. As the future of geolocation data storage unfolds, businesses must stay ahead of the curve by embracing new advancements and leveraging this technology to its fullest potential.”

Consequently, the market for these solutions is large and growing at a brisk rate.  Revenue was $45.4 billion in 2021 and is expected to rise to $402.4 billion in 2031, a healthy compound annual growth rate of 24.6%. So, let’s take a closer look at how the technology works, what it can be used for, what comes next, and what challenges it faces.

What is Geolocation Data?

The world is a big place. Geolocation data identifies where a person, device, or object resides at a particular moment. This location is typically represented by latitude and longitude geographical coordinates. The site information is mapped to an application that translates it, so it can be incorporated in a wide and growing variety of applications that help individuals and businesses.

Nowadays, geolocation data is available with a click of a mouse or a swipe of a finger. The intelligence found in today’s smartphones, tablets, laptops, smartwatches, and other devices provides companies with a way of delivering solutions that track individual and vehicle travel routes.

Definition of Geolocation Data

Geospatial data can be collected in different ways, such as GPS satellites, Wi-Fi networks, cell towers, and IP networks. These products include software and hardware that send information to network devices, like satellites and wireless receivers, and track the path they travel going from places like home or a warehouse, to the local market or across the country.

The technology has been commercialized for decades and is widely used. Mobile devices represent a large user base: Almost three-quarters of the global population aged 10 and over now own a smartphone. Many smartphones and applications have geolocation-integrated them.

There are two prime uses for such solutions. The first is to enable the data collector to provide services to individuals, which can be a variety of items: checking the weather, requesting a ride, ordering food, or other tasks that require a user's location to fulfill. The second is businesses that rely on the information to track company equipment, materials needed for production, or finished goods as they travel from place to place.

How do Latitude and Longitude Work?

A geolocation definition requires an understanding of latitude and longitude. They function as partners in a location coordination system that has been used for centuries, so humans can navigate their way across the Earth. Each item coordinate starts with a central location and measures point in degrees across the globe. The coordinates pinpoint the exact place of any place on the planet.

Latitude begins with the Equator and provides measurements that are north or south of it. Lines of latitude start at 0 at the Equator and then go from 1 to 89 north and south of it.

For longitude, the starting point is the prime meridian at Greenwich England. It starts at the North Pole, passes through Greenwich, and extends to the South Pole, which is 0 longitude. Lines east of the prime meridian are numbered from 1° to 179° East and lines west of the prime meridian are labeled 1° to 179° West. The 180th meridian, the International Date Line, is in the Pacific Ocean and the exact opposite of the prime meridian.

The combination of the two establishes a grid that illustrates locations on a map. For instance, New York City’s World Trade Center’s latitude is 40° 42' 25.19" North, and its longitude is -74° 00' 27.00" West.

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Geolocation Data Collected Methods

Understanding where a person or object is is difficult. Different data collection methods have emerged that perform that task. They have some similar traits but differences in what equipment they use and the processes that they follow.

Starting in the early 1970s, the US Department of Defense built the GPS, which relies on satellites orbiting the Earth to identify places on the planet. In the early 1990s, the system was fine-tuned, so by the turn of the millennium, GPS receivers were accurate within centimeters and even sub-millimeters. In 2023, 18 GPS satellites were broadcasting and providing systems with the ability to track individual movements.

GPS and Mobile Devices Work Together to Track People and Objects

GPS applications and smartphones make location data available through a combination of satellite technology, radio signals, and software. Smartphones have built-in GPS receivers that can pick up signals from GPS receivers. Once the mobile phone has determined the user's location, mapping software overlays the information and creates digital maps of the user's position on the screen

IP Addresses and MAC Addresses Pinpoint Movement

A Media Access Control (MAC) address is a unique identifier assigned to a network interface controller (NIC) and enables communications at the data link layer of a network segment. It is also known as a hardware address, Ethernet address, or physical address.

The MAC address is a 48-bit (6-byte) alphanumeric identifier, usually expressed as six pairs of hexadecimal digits separated by colons or dashes. The first half of the address typically represents the manufacturer of the network interface card, while the second half is a unique identifier assigned by the supplier. MAC addresses are generally fixed and hardcoded into the hardware by manufacturers although some devices and network interfaces allow users to change or spoof their MAC addresses for various reasons, including security and privacy concerns.

MAC addresses operate at the data link layer (Layer 2) of the OSI model and are primarily relevant within the confines of a local network. They are not typically routable over the Internet. Suppliers publish geolocation API information so third parties can build a layer of software that connects their devices to the value-added applications and tools.

IP geolocation is also quite common. Suppliers and carriers use different data collection methods to pinpoint places. An IP address is also a numerical label assigned to each device connected to a computer network that uses the Internet Protocol for communication. It serves two main purposes: host or network interface identification and location address.

Every device connected to the Internet, including computers, smartphones, and servers, is assigned a unique IP address. This addressing system enables the routing of data packets between devices, ensuring that information reaches its intended destination.

IP addresses can be used to estimate geographical location.  Carriers have the information but must make it available via geolocation APIs, so others can add to it.  Such solutions are available from third parties, with some being freeware and others coming with licensing fees. Companies build applications that determine where website visitors are coming from and enforce any local laws that limit Internet interactions. However, this method is less accurate than GPS and can only provide information about the location of the Internet service provider or the proxy system.

What are Common Geolocation Data Applications

The business applications of geolocation are far-reaching and being leveraged by all types of enterprises: technology firms, transportation, utilities, manufacturing, retail, financial services, and governments. “Organizations that implement geospatial and location intelligence (GLI) capabilities will benefit from opportunities to analyze the spatial dimension across their strategic, tactical and operational analytics,” according to Gartner.  “This type of insight can produce real business results, such as reduction in assessment time for new franchise salons; analysis of driving patterns to optimize fleet performance; or optimal placement of wind turbines by compiling 10 times the breadth and history of weather data including temperature, precipitation, wind direction and velocity.”

74% of data buyers use location data today, whether they source it internally or externally. Across every industry studied, at least 25% of enterprises are using more location data than they did just 1-3 years ago.  So, several use cases have emerged.

Navigation and Mapping Help Individuals

Geolocation data is widely used in navigation apps and GPS systems (like Google maps) to provide real-time directions to individuals as well as corporations. Location analytics tools also analyze traffic trends and provide users with the fastest route options. These applications have been tremendously successful and changed the way that people move from place to place. Suppliers continue to try and differentiate themselves from one another by adding new functionality to their products. They provide a wide and growing range of value-added services designed to enhance driving and provide vendors with needed information.

Location-Based Services Alter Marketing Landscape

A thriving mobile business application ecosystem has emerged that uses geolocation data to offer location-based services, such as local recommendations and weather updates. Retailers often use geolocation data as part of their marketing strategy and targeted advertising, personalized promotions, and discounts available to users in specific areas.

Geolocation Data Streamline Product Delivery Transport and Logistics

Manufacturing companies employ location analytics systems to gain real-time tracking information and streamline product movement, identify the most efficient routes, and monitor stock flow. Transport businesses leverage geospatial data and location analytics to improve fleet productivity, fuel consumption, and efficiency, monitor vehicle movement, reduce idle time, and optimize vehicle performance. Organizations can facilitate efficient supply-chain management and boost the volume of timely deliveries.

The Future of Geolocation Data

Like any technology, geolocation data continues to evolve alongside other advances. Consequently, improvement areas coming to geolocation data system base functionality as well as its integration, which often requires the development of enhancements to system and application APIs. A handful of emerging trends are gaining interest.

Enhance GPS Satellite Bandwidth

As geolocation applications expand, bandwidth contention becomes more of a problem. The L5 band operates at 1176.45 MHz. It has higher transmission power and enhanced signal architecture compared to previous GPS signals (L1 and L2). L5 improves GPS’s current performance by delivering a processing gain due to its large bandwidth and relatively longer spreading codes.

Embrace Generative Artificial Intelligence

The newest wave of artificial intelligence systems, dubbed Generative AI and exemplified by ChatGPT derivative, represents a turning point. One reason why today’s generative models are gaining so much attention is they work with much larger volumes of information (hundreds of billions of words) and larger data models (hundreds of billions of parameters) than previous AI systems. They possess impressive and unprecedented power and perform very sophisticated functions, like bar exams. Such capabilities can be used to analyze large geolocation datasets, extract new insights, and improve the accuracy of target advertising and traffic delays.

Adopt Edge Computing

The computer industry is undergoing a fundamental shift from large central systems to distributed edge devices. Traditional systems had processing power located either in a central data center or an end device. Edge pushes processing power between the two, a change that produces a few benefits. Corporations reduce their network bandwidth traffic, which lowers costs and improves performance.

Hospitality, an Emerging Use Case

Hotels are dabbling with geolocation data as they try to service their clients better. They are tinkering with new and recurring guest foot traffic, to understand trends, like how many visitors utilize the hotel’s fitness center regularly and how much time they spend in the hotel lounge and lobby bar. Hotel management can also benefit from location analysis tools by better knowing their guests’ patterns and catering to their needs and preferences while they are staying at the hotel.  Furthermore, location analytics tools can assist hotels in comparing monthly, weekly, and daily, visitor counts to those of competing hotel chains.

Privacy Becomes a Top Consideration

As noted, businesses use geolocation data to target advertising and promotions to specific regions or demographics, leading to more efficient marketing strategies and campaigns, which increase sales. However, location data collected by one company or app is often shared with others. Thus, customers potentially no longer manage how their information is used and who has access to it. When companies engage in third-party sharing, they risk exposing clients’ personal information to others without their knowledge or consent.  So, privacy concerns have been rising in importance.

Geolocation data can uncover users’ personal details, such as their residential address, workplace, or frequently visited spots. That information creates potential problems. If geolocation data falls into the wrong hands, outsiders can see personal activities, track movements, and potentially expose them to stalking, harassment, cyberbullying, identity theft, stolen identities, and other forms of abuse. The potential tracking can be particularly concerning for individuals who may be vulnerable such as victims of domestic violence.

Individuals may not always be aware that their location is being tracked or they may not have given explicit consent for it to happen. Consequently, the use can be an infringement on their right to privacy, raising adding concerns about the ethical use of geolocation data.

In response, new laws have been introduced. The laws govern the collection, use, and protection of personal information and try to ensure that individuals have control over their data, and it is used in ethical ways. These laws vary across countries and regions, and a few better-known ones follow.

General Data Protection Regulation Set the Privacy High Bar

The European Union’s General Data Protection Regulation (GDRP) is one of the most comprehensive data privacy regulations. The GDPR standards grant individuals greater control over their data and require organizations to obtain explicit consent for data processing. It also imposes strict requirements on data breaches and includes the right to be forgotten.

California Enacts Privacy Regulations

The California Consumer Privacy Act gives state residents rights regarding their personal information, including the right to know what data is collected, the right to opt out of the sale of their information, and the right to access and delete their information.

Historically, an individual and an object’s whereabouts were known only to people and devices in the immediate area. Tools, like GPS systems, emerged to digitize that information. Several technologies, widespread networking, the growth of mobile phones, and the growing importance of APIs, provide a rich ecosystem capable of not only tracking but also delivering value-added services based on geolocation data. The solutions have changed life on Earth, and as technology improves, the breadth of solutions and their impact increase.


What is Geolocation data?

Geolocation data pinpoints the physical location of a person or device. Typically, the information is noted in latitude and longitude.

How is Geolocation data collected?

Companies use a handful of methods: GPS, Wi-Fi, cellular networks, and IP addresses to identify locations.

How accurate is Geolocation data?

No geolocation technique is 100% accurate Signal interference, obstacles, and technology limitations hinder precise coordination. But most solutions are usually within a few hundred feet – and the technology constantly gets better.

Why is Geolocation data important?

This data enables individuals and companies to reach their desired destination, track product shipments, and find needed resources, like a gas station or a place to eat.

What are significant concerns with the collection of this information?

Consumers have become more concerned with data privacy and how third parties track and use their personal information. Geolocation data can be used to stalk individuals and perpetrate identity theft.

Paul Korzeniowski
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