A nascent industry involving the likes of Google and Nokia is pinpointing the movements and behaviors of millions of cell-phone users

By Stephen Baker

Watch the Video…

Watch full size video:

Imagine that your business had a complete log of your customers’ wanderings—every trip to the grocery store, every work commute, every walk with the dog. What could you learn about them? Armed with that knowledge, what sorts of goods and services might you try to sell them? Just as important, if you made your best toss—relevant and timely, of course—would customers concerned about privacy tell you to get lost? This isn’t science fiction. A nascent industry extending from the laboratories of Google (GOOG) and Nokia (NOK) to a consecrated wafer of data-fueled startups is struggle with these very questions.

On a unblemished winter evening in New York’s SoHo neighborhood, a small team of analysts at a startup called Sense Networks is poring over the movements of nearly 4 the masses cell-phone users completely the course of a year. They have been tracked by global positioning systems, by cell towers that catch their signals, or by local Wi-Fi networks that detect their presence. As distant as the Sense analysts can look to, these rabble have no names: They are absolutely dots moving across the maps on Sense’s computers. (The data trove comes from a company New York-based Sense will not name.)

Much be able to be learned, it turns out, from the patterns of those dots moving across the maps. It’s possible to see clusters grow around a easy restaurant or retail store. It’s also easy to learn about each dot. Business travelers tend to congregate in certain spots in each city. The newly out of employment often shift from the clocklike order of work to farther more stray movements. And Sense be able to flesh completely these digital stick figures with supplemental given conditions. By noting where dots appear to sleep, the firm be able to designate an average neighborhood revenue to each one. It in consequence becomes easier to predict whether those spending time near car lots are in the market as being luxury brands or economy models.

After a few weeks of monitoring one dot, the Sense computer usually has enough data to reason it into a tribe—a group of folks with customary behaviors. One tribe comprises night owls who travel through observingly bars and restaurants into the wee hours. Sense founder Greg Skibiski and his essential scientist, Tony Jebara, who is also a Columbia University computer science professor, call them “Young & Edgy.” Another group seems at first to overlap by the Young & Edgy. These people, though, stay true to a select establishment and return home at greater degree regular hours. “Barflies,” says Jebara.

With every track they take, the members of Sense’s tribes are helping to create a new laboratory of humanity on the be reckoned. This emerging phenomenon, powered by Web phones and an explosion of new mobile-software applications, is the long-awaited Next Net. “The phone in your hand is the bridge between the virtual and real worlds,” says Michael Halbherr, vice-president of Nokia’session gate5 mobile Web one.

Sense, led by the 35-year-old Skibiski, is a mere culex in this market. It’s a services shop powered by five PhDs and a slew of algorithms. Phone companies and advertisers provide Sense with raw data on the community’s movements and behavior. Sense’s mission is to transform mountains of data into intelligence: that which individuals will be most likely to buy, or in what place they’ll be when a craving hits. The company is looking for venture money and may struggle in the present rough market. But whatever Sense’session fate, the method of its research—predicting rabble’session preferences by their movements—could presently work its way into industries from marketing and finance to media. The questions are how soon these insights will turn into currency and that companies behest lade out up the profits.

Marketers require long dreamed of zeroing in on shoppers, whether in a mall or a competitor’session fund, and hitting them with targeted ads or coupons. (The privacy implications are a big deal, as we’ll see.) But the business ramifications of the Next Net stretch in advance of marketing.