Twitter SXSW year 1: join to find where the parties are
Twitter SXSW year 2: wow, we can use this thing to communicate
Twitter SXSW year 3: some companies are using this to market/sell, but how the frak does twitter make money on this?
Twitter SXSW year 4: we have the keynote, but we won’t talk about our super secret monetization strategy.  It’s bad when our employees’ Girl Scout cookie sales have eclipsed our ad revenue.  Actually the Thin Mints alone beat our Q1 actuals.

Foursquare, Gowalla, and other location-based services dominated SXSW discussions.  As night falls upon Austin and it’s time to catch up on sleep, these companies have many opportunities.  I really see these services as the super-local immediate advertising solution.

Do you own an Italian coffee shop and pizza parlor a few blocks away from a cool urban bookstore where smartphone users who don’t yet have a kindle are trying to earn the “I am really much more literate than you” badge?

What would you pay to put a little ad in their face post-check-in reminding them that you have espressos and mochas for when they are thirsty and fresh hot carnavore and veggie pizzas for when they meet their soul-mate reaching for the same book?

This level or targeting is ridiculously powerful.  all-you-can-eat buffet -> pharmacy special on antacids, Harley Davidson Dealership -> insurance company or hospital organ donation signup, DIY hardware store -> real plumber, Blockbuster -> nearest $1 RedBox, bar you’re in -> better bar with more exciting things, Toyota dealership -> Honda dealership… the list goes on and on.

What do I predict for how I will describe location?

4sq/Gow SXSW year 1: hello, we have locations and it works with twitter.  No, don’t worry about stalkers, really.
4sq/Gow SXSW year 2: frak, we just grew a ton and might turn the corner since we beat twitter and Facebook to the punch
4sq/Gow SXSW year 3: we just got acquired by XYZ as a platform for super local mobile ads – OR – we just got buried by Facebook who now owns location

You can find me on twitter at @heuge, but I mostly use it to just update my Facebook status.