Background Location Finds A Loop(t)hole On The iPhone

picture-8A location-based social network is not going to truly take off on the iPhone until it can run in the background. You know it, I know it, and even Loopt, which makes such an app, knows it. That’s why they’ve done something about it.

Beginning today, Loopt is rolling out a trial for background location on the iPhone. Yes, you read that right.

If you’ve been following the iPhone at all over the past couple of years, you’re undoubtedly asking yourself how this is possible, since the device does not allow third party apps to run in the background. Has Apple changed its mind about background apps? Not yet. Instead, Loopt is partnering with other companies in the mobile industry for what it’s calling “Always-On Location Service.”

Loopt co-founders Sam Altman and Alok Deshpande would not disclose the names of any of these partners, noting that the system set up to make this happen is very “complex” and involves a number of players. But at least one of them has to be AT&T, which is, of course, the network the iPhone runs on. Loopt, which seems to be particularly good at carrier relationships, has cut deals with AT&T in the past.

What this means is that these guys have gotten around the iPhone’s limitation by keeping a pipeline open on AT&T’s side that is constantly sending your location data to Loopt. This doesn’t require any app to be running on your iPhone — not even Loopt — and the location data will be sent even when you’re on a call or surfing the web on your iPhone. Most importantly, because there is no app required to do this, it doesn’t drain your battery life, Altman tells us.

So what does Apple think about all of this? Altman refused to comment on that, but given the cordial relationship Loopt has had with Apple (being featured both at WWDC last year and in an iPhone commercial), it seems likely that the two sides at least talked about this before Loopt pulled the trigger. That said, because no application is actually involved in this process, it looks like Loopt has essentially found a loophole around Apple on this one.

Privacy will undoubtedly be a major concern with such a feature. But Altman notes that you have to go to a website to actually sign up for this, and you can turn it off or on at anytime on that site or via an SMS message. And he believes some of privacy concerns will fade as people get used to such services. “The future of location-based services is always-on,” he says.

looptI agree, this seems like a huge win for Loopt (well, if users are okay with paying for the service, more on that below). I’ll be using it a lot more now because first of all, I don’t actually have to open the app to update — but more importantly, none of my contacts will either. So oddly, I probably will be opening the app itself more now too because of that. And eventually, you could see such background location functionality playing a roll in advertising on the iPhone.

They way this will work is that you will be able to receive alerts (emails or text messages) when people or places of interest are nearby to your current location. Loopt can also now build what it calls a “Life Graph” for you — basically, keep a log of where you’ve been. Again, this will be opt-in.

Altman would not comment on if its competitors like Whrrl or Brightkite could also strike similar deals, but Deshpande confirms that no one else is offering this (at least not yet). And Loopt is getting ready to come out with a version 2.0 of its iPhone app that should take on other competitors like Foursquare.

As it seems clear that AT&T is the key factor in making something like this happen, it’s nice to see them doing something innovative to actually help their iPhone customers get a feature that many of us have long wanted. Assuming it works well, it might even be enough to make us forget the whole months-late MMS thing.

But this good news has a price. $3.99 a month, to be specific, which users can sign up for on this site. Initially, Loopt is going to limit the trial to 5,000 testers.

Disclosure: Loopt offers a TechCrunch branded version of the service here.

[photo: flickr/Rev Dan Catt]