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Economic Downturn Favors Cheaper Navigation Devices

While sales of high-end PNDs and expensive in-dash navigation solutions are being hit hard by the economic recession, handset-based navigation is enjoying renewed momentum, with PND vendors TomTom and Garmin entering this space hoping to take a piece of this fast-growing navigation segment.

“Much of the current activity in the location industry is focused on handset-based navigation,” says ABI Research practice director Dominique Bonte. “The launch of open source mobile operating systems and GPS-enabled smartphones with large touch screens is currently one of the main drivers. Telenav’s GPS Navigator was recently launched on Android phones.”

The clearest indication yet of the growing importance of handset-based navigation is provided by both PND market leaders. Garmin is preparing the launch of several nuvifone models in partnership with Asus. TomTom will launch off-board navigation and is setting up a separate mobile division. Carriers in Europe are stepping up their efforts, with Vodafone acquiring Wayfinder. Even network vendors are getting interested, with Ericsson entering into a revenue sharing agreement with Networks in Motion to offer navigation services to carriers in order to drive network data traffic.

A very significant trend is the availability of free advertising–funded navigation solutions driven by Jentro Technologies, which has partnered with Bouygues in France and Das Oertlich in Germany. Israel-based Locationet also offers free navigation both independently and in cooperation with French carrier Bouygues and German directory service provider Telegate.

In the meantime the PND market is further consolidating with Mitac having acquired Magellan and several players such as Harman, confronted with decreasing growth levels and declining margins, exiting this space. However connected PNDs offering real-time navigation services are being launched by TomTom, Telenav, and Best Buy in the US and Europe to stave off competition from phone-based solutions.

In the in-dash navigation market OEMs are embracing partnerships to offer cheaper embedded solutions such as TomTom’s and Renault’s co-designed sub-$500 system, or co-marketing agreements with PND vendors like Garmin.

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Consumer Navigation Devices and Systems, a recent study from ABI Research, examines the major navigation features, form factors, trends, ecosystem, drivers and barriers. The study also contains forecasts for shipments and revenue. It forms part of the firm’s Location Based Services Research Service.

ABI Research provides in-depth analysis and quantitative forecasting of emerging trends in global connectivity. From offices in North America, Europe and Asia, ABI Research’s worldwide team of experts advise thousands of decision makers through research and advisory services in seven key practice areas. Est. 1990. For more information visit www.abiresearch.com, or call +1.516.624.2500.

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