August 19, 2010, 3:46 PM — Pressed to respond to the rising popularity of online services that let people broadcast their location, Facebook mostly hit the right notes with the initial design of Places, although it's too early to declare the service will be a sure success, according to several experts.
Competitively, Places adds a necessary feature to Facebook, now that Foursquare, Gowalla and others have proven there is a nascent but growing demand for so-called location-based services, which let people share their geographic location online by "checking in" through these applications upon arrival.
Because many of the locations people "check into" are commercial establishments, like retail stores and restaurants, Places will boost Facebook's efforts in local advertising.
In addition, Places deepens Facebook's already strong link between its social network and mobile devices, a link that Facebook has correctly identified as critical for its current and future usage growth and engagement.
While tending to these inescapable competitive realities, Facebook is being considerably considerate with its smaller location rivals by partnering with several of them and by designing Places also as an open platform that all external developers can tap.
Facebook, no stranger to privacy controversies, is striking an adequate balance with a friends-only default setting for Places and with granular controls that allow people to establish custom settings of access to their location data, including making it available to everyone on Facebook or, at the other extreme, turning off Places completely.
That's the general consensus of several industry observers, although they also warn that some questions remain, that some details need to be filled in and that it's likely that unforeseen issues will crop up and will need to be addressed as people start using Places.
For now, the launch of Places is a big step for Facebook that, sooner or later, will have a major impact on the average social-networking user.
"This has the capacity to mainstream the location 'check-in' phenomenon in a way that Foursquare and Gowalla haven't," said industry analyst Greg Sterling from Sterling Market Intelligence in an interview.
"The awareness level for this type of service is still fairly low, so Facebook is bringing this to a mass market of 500 million people," Sterling added, referring to the size of Facebook's user base.
Michael Gartenberg, an analyst with Altimeter Group, also sees this potential: "This takes the idea of location services from an enthusiast market of the digerati to the mainstream of Facebook users," he said in an interview.