Navigating the future of GPS

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Louisa HearnSeptember 28, 2007 - 2:07PM
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There has never been a better time to buy an in-car GPS navigation system; entry level models now retail for as little as $399, and for just a few hundred bucks more you can buy a unit that will also synch in with your phone and iPod.
But a shadow is looming over the sector as mobile phone giants seek to muscle in on the action, much as they did with cameras a few years ago.
Total unit sales for the in-car navigation sector are expected to swell to 1 million next year as the early adopter crowd gives way to the mass market, delivering annual growth of 200 to 300 per cent. Given these glowing predictions it's hardly surprising the mobile giants want a slice of the action.
Nokia and BlackBerry are just two of the handset makers pushing a range of high-end GPS-enabled phones, while phone service providers Telstra and Vodafone are peddling satellite location services to mobile customers with compatible phones.
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But Chris Kearney, marketing manager for portable GPS manufacturer Tom Tom, believes an inherently problematic issue for in-car navigation on a mobile phone will be the screen size.
"The big screen of in-car devices is what people are asking for so, in the short to medium term, we do not anticipate cannibalisation from mobile phone makers," he says.
He adds that screen size is one of the features that customers are happy to pay a premium for, along with features such as Bluetooth connectivity, synchronisation with a mobile phone and music player functionality.
However Nokia's director of multimedia business, David Watkins, argues that screen size is becoming much less of a consideration for customers.
"Our screens have 2.8-inch displays and the way we are rendering the information means you don't actually need a bigger screen.
"We believe single purpose devices like in-car navigation, which are not connected to the internet, will become quite niche players," he says.
He adds that the location based market has far more sweeping applications than in-car use, providing consumers with access to world maps and local content suitable for those finding their way around a city by foot.
"For instance if I want to find a Croatian restaurant in the middle of Sydney I could locate one and maybe even read their menu and check out some reviews," he says.

It is this flexibility that he believes will win the race in the navigation wars.
But for now most mobile product offerings are still out of reach of the masses, with GPS-enabled handsets tending to cost about $1000.
Phil Moujaes, Bing Lee general manager, believes that the market for in-car navigation will survive for a long time to come, in spite of the new generation of mobile offerings.
"Not everybody wants to have a mobile phone as a navigation product, and downward price movement means you will now only pay between $399 and $900 for a dedicated in-car navigation system, whereas many of the devices were originally priced at around the $1000 mark," he says.
And along with the lower prices come an enticing range of new features. Pay a little extra for Bluetooth connectivity and your telephone address book can be transferred to enable hands-free phone calls, with incoming calls displayed on the screen. Some devices will even connect to your iPod or play music from a memory card. Another compelling feature coming soon to Australian users will be live traffic reports, helping drivers to dodge accidents and traffic jams.
Citing parallels with the camera market, Mr Kearney says that, while mobile phones try to do lots of things well, car navigation system manufacturers try to do just one thing well.
"Cameras have not gone away and, if anything, people have become more and more aware of the different products out there," he says.
But Jerson Yau, IDC wireless research analyst, says the mobile navigation market is evolving quickly, with high-end navigation features likely to reach the middle market within two years.
"In that time frame I would expect these location-based services to be as commonplace as a camera on mobile phones. It will be a basic function of the phone and users will choose whether or not to use it," he says.
So will consumers ultimately be swayed by the richness of a dedicated navigation unit, or will the convenience of having everything they need in one small, portable device win the toss?
Nokia's Watkins says that there is a clear trend of mobile phones slowly taking over the camera business.
"Nokia has sold more than 170 million megapixel cameras and we are the largest manufacturer of cameras and digital music players in the world. You will see that trend in the navigation market as well," he says.
However Yau argues there is no guarantee that either platform will ultimately dominate the space.
"My opinion is that future cars will have a touch screen about the size of A4 that will become an interface for your phone and any other devices that you carry with you. This will all be driven by a sophisticated operating system built into the car and it's very likely that car manufacturers will partner with big brand names in the computing field.
"There are a lot of ways to get the consumer to where they are going and it may simply be a case of who gets there first."