In the first instance of a wireless operator using its closely guarded user location data for mobile advertising, UK-based O2 has entered a partnership with US-based Placecast for a trial said to reach 1M wireless customers.

Placecast has made a name for itself by building on the concept of geo-fencing — the act of drawing an invisible boundary around a given location and serving an opt-in SMS message when users enter said boundary.  O2 has licensed Placecast’s geo-fencing technology for a 1 million customer trial in the UK where the operator has already signed such advertisers as Startbucks and L’Oreal.

The partnership offers a different dynamic than what Placecast is used to here in the US.  Here, Placecast interacts with brands directly.  In its UK trial, the company is selling its services to O2 as a white label solution.  The most interesting aspect is the use of carrier-originated user location data on the part of O2.  We’ve long said that carriers around the world are dumb not to utilize the treasure-trove of highly-accurate geodata they all possess.  Through its partnership with Placecast, O2 seems to be finally coming around.  Hopefully others will follow.