Location technologies at the heart of M&A, investment activities

Two deals this week involving Locations Labs and IndoorAtlas, respectively, highlight the growing importance of location-based technologies as keys to enabling other value-added services.

AVG Technologies announced it is paying up to $220 million for Location Labs, which offers several products, including family-locator and safe-driving apps as well as mobile device management. The deal calls for Location Labs to pay $140 million initially and up to $80 million more over the next two years.

AVG, which provides online security, said the acquisition gives the company "a proven innovative platform of personal security products for mobile devices and deep integration with global industry partners, including all four major mobile operators in the United States. Location Labs' integrated platform for mobile operators, pre-installed service on Android smartphones, and mobile subscription services including family, safety and personal device management, are all expected to complement and expand AVG's existing mobile offerings."

AVG expects to generate $60 million to $70 million in mobile bookings in 2015 and anticipates that number to reach $100 million during 2016. The deal is expected to close in the fourth quarter.

Meanwhile, IndoorAtlas, developer of magnetic-positioning technology for indoor location, snagged a $10 million investment in Series A funding from China's Baidu, which also signed an exclusive agreement to use the vendor's technology as a foundation for indoor location-based services (LBS) in the Chinese market.

"IndoorAtlas' intellectual property portfolio and global geographical coverage will be instrumental in helping us at Baidu build out our LBS platform for local merchants in China and abroad," said Liu Jun, Baidu vice president, who leads the company's LBS business unit.

Indoor Atlas said the funding will go toward R&D, engineering and business development in the United States, Asia and Europe.

"The competition in this space is heating up as the largest global players who have so far focused on the outdoors now turn towards mapping the indoors in the most cost effective and scalable way," said Greg Sterling, senior analyst at Opus Research. "With this deal, Baidu is clearly endorsing the idea that magnetic positioning is fast emerging as the GPS of indoors." He noted magnetic positioning is complemented by Wi-Fi, Bluetooth Low Energy and Pedestrian Dead Reckoning (PDR), a pedestrian-positioning technique that relies upon a smartphone's accelerometer sensor.

For more:           
- see this AVG release
- see this Indoor Atlas release

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