The number of mobile location-based service users in Europe will grow from 20 million users in 2008 at a compound annual growth rate (CAGR) of nearly 37 per cent to reach 130 million users in 2014.

Berg Insight estimates that more than 20 per cent of mobile handsets shipped in 2009 will feature GPS and that the installed base in Europe will surpass 50 per cent of total handsets already in 2013.

It has made the prediction based on the fact that it believes local search, navigation services and social networking will become the top mobile apps in terms of number of users.

The company says the most popular mobile LBS services will make their money from advertising, though revenue may not grow at the same pace as usage.

Senior analyst André Malm said: “The key enablers for LBS are rapidly falling into place. On-device application stores allow easier access to mobile services for a broader audience at the same time as flat-rate data plans make pricing more transparent.

"In conjunction with more operators opening their location platforms to third parties, location aggregators have started to provide common APIs for accessing location data from multiple operators. This together with ever growing GPS handset sales will allow more application developers to create location-enabled mobile applications.”