How Geolocation Data and Compliance Influence User Experience on Digital Platforms

Unless you’re an advanced user, your first digital interaction with an app (streaming a live sports event, ordering takeout, purchasing event tickets, or wagering) will typically be performed via the app’s home screen: fast signup, tailored deals and promotions, and a selection (carousel) of suggested content.

Behind the scenes, though, what really decides whether that user can complete an action is a blend of geolocation data, licensing rules, and increasingly strict privacy policies.

The geographical location of a user on a modern platform is no longer simply a data point to fill out with the user's personal information; rather, it will directly affect what shows or movies are available to the user through that particular platform, what type of delivery options the user has access to, of whether or not the user has access to a particular ride-sharing service within their within their geo-location, and whether or not they can wager real money using the platform. 

In the U.S., geolocation has become the underlying technology that provides the private marketplace operators do to ensure compliance with state or local regulations regarding the distribution and marketing of their products and services.

Invisible Borders in Regulated Digital Markets

Many digital services operate inside invisible borders: regional content rights for streaming, city-level rules for ride-sharing, zoning restrictions for short-term rentals, or state-level licensing for financial products. A user may open the same app in two different cities and see different prices, payment options, or even a message saying the service is not available in that area.

Online gambling is one of the clearest examples of how strict those borders can be. In the United States. The American Gaming Association estimates that commercial gaming revenue reached approximately $72.04 billion in 2024, a new annual record and 7.5% above 2023, marking the fourth straight year of growth. 

Within that total, fully regulated iGaming in just seven states generated around $8.4 billion in the same year, including the expansion of markets like Rhode Island. At the same time, the legal map is fragmented: 39 states plus Washington, D.C., have some form of legal sports betting, and 31 jurisdictions allow those bets to be placed online. 

Full online casino offerings are still concentrated in a handful of states such as New Jersey, Pennsylvania, Michigan, and others. In that context, guides and comparison pieces have become popular because they help users understand which platforms are actually accepting US players in different formats, from crypto-focused casinos to more traditional online gambling sites.

The same pattern appears in other sectors. A telehealth app may be available only in states where clinicians are licensed. A fintech product may restrict certain services based on the user’s state of residence and real-time location. 

A ticketing platform may offer different promotions depending on the venue’s local rules. In all of these cases, location verification is not just a technical feature; it is a compliance requirement that shapes what the user can do on the platform at any given moment.

From Cloud Infrastructure to Screen: How Geolocation Turns Into UX

A common method of filtering includes combining several kinds of devices, such as simple IP filtering software, an SDK inside a mobile app, as well as specialized cloud-based services utilized by many different business sectors (e.g., media industries, gaming companies, financial services firms, online betting businesses).

The outermost layer of protection most filtering technology uses is known as DNS-based georouting. With this type of system, the filtering process occurs before the filtering request has been sent to the core servers. 

For example, with a DNS-based georouting system like Amazon Route 53, businesses can implement detailed compliance policies that will redirect all users located in specified locations to a different web page (e.g., to an error page instead of their requested website). This may help reduce infrastructure costs and limit unauthorized access.

Even though this type of setup is not enough on its own to meet stricter requirements in areas such as online gambling or financial services, it helps clear a large portion of invalid traffic right at the network edge. Closer to the application, it is common to see CDNs like Amazon CloudFront and web application firewalls such as AWS WAF in use.

CloudFront can block or allow access by country directly at edge locations, returning error responses cheaply and with low latency. Even in sectors with multi-million-dollar revenue, costs matter for smaller or newer operators that need to control how much they spend per request while still enforcing geographic rules.

Through AWS WAF's greater flexibility for defining rules and filtering based on U.S. state, as well as inspecting headers, including X-Forwarded-For, it allows for a finer level of granularity when it comes to filtering users through proxies and load balancers in architectural processes. 

This combination facilitates the creation of a single set of rules, for example, for all streaming-only users in a specific geographical region and another, potentially more stringent set, for those users who may attempt to perform a financial transaction or place a wager using that same platform.

Although the most immediate way that users experience the impact of geofencing technology is through the devices they access, operators can take advantage of native SDKs available from iOS and Android as well as JavaScript libraries and Amazon Location Services to gather, in real-time, asset GPS coordinates, Wi-Fi information, and other location signals from the smartphones or laptops of their users.

The information gathered by these methods is then used to validate the user at the point of session initiation against the applicable geofences created for the corresponding state, country, or any other allowable location, thereby providing the user with that session approval or denial instantaneously. 

In jurisdictions where the regulation of iGaming is still ongoing (e.g., individual states within the United States), many operators use licensed geolocation providers such as GeoComply, OpenBet, and/or Xpoint to facilitate the processing of user sessions against established geolocation boundaries.

These systems go beyond basic GPS or IP checks. Device integrity is assessed, VPN use is identified, location-spoofing software is detected, and sudden position changes that suggest possible fraud, account sharing, or proxy activity are identified.

Other regulated industries are starting to implement similar techniques to assist platforms in determining whether to approve or deny payments, trades, or content authorizations. All of this has to be orchestrated in a way that doesn’t break the experience. 

A location-permission pop-up that takes too long to respond, a generic error instead of a clear explanation of why a video, ride, or bet cannot be processed, or repeated checks that interrupt live play or real-time interactions are examples of how technical decisions about geolocation translate, in practice, into UX friction. 

To remain competitive, all digital platforms should balance regulatory obligations with minimal friction while maintaining transparency between their users’ identities and locations at the time of engagement (i.e., Play, Pay, and/or Bet).