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The first Location-Based Services were launched commercially in Japan by KDDI in 2001. The first book to discuss location-based services was Services for UMTS by Ahonen & Barrett (editors) in 2002. Mobile handset makers have tended to take 'upstream initiative' to embed LBS in their mobile equipment. Originally, LBS was developed by mobile carriers in partnership with mobile content providers.

LBS services is an information and entertainment service, accessible with mobile devices through the mobile network and utilizing the ability to make use of the geographical position of the mobile device. LBS services include services to identify a location of a person or object, such as discovering the nearest banking cash machine or the whereabouts of a friend or employee. LBS services include parcel tracking and vehicle tracking services. They include personalized weather services and even location-based games. They are an example of telecommunication convergence.

This concept of location based systems is not compliant with the standardized concept of real time locating systems and related local services (RTLS), as noted in ISO/IEC 19762-5 and ISO/IEC 24730-1.[citation needed]

Mobile messaging plays an essential role in LBS. Messaging, especially SMS, has been used in combination with various LBS applications, such as location-based mobile advertising. SMS is still the main technology carrying mobile advertising / marketing campaigns to mobile phones. A classic examples of LBS applications using SMS is the delivery of mobile coupons or discounts to mobile subscribers who are near to advertising restaurants, cafes, movie theatres. The Singaporean mobile operator MobileOne has carried out such an initiative in 2007 that involved many local marketers, what was reported to be a huge success in terms of subscriber acceptance.

Examples of companies offering location-based messaging (sometimes referred to as 'geo-messaging') are Zhiing (international), Loopt (US), Dodgeball (US) and GeoMe (Spain).

The main advantage is that mobile users don't have to manually specify ZIP codes or other location identifiers to use LBS, when they roam into a different location. GPS tracking is a major ingredient for making it possible, utilizing access to mobile web.

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