Next Five Years: Personal Navigation to Remain Most Popular LBS App
While many innovative LBS (Location Based Services) applications such as friend finders and location-based search will be launched by carriers in the next few years, personal navigation will remain the most important LBS category providing high value and clear benefits to end users.
But according to ABI Research principal analyst Dominique Bonte, “Enterprise LBS applications for asset and vehicle tracking and work force management will become an important revenue generator for carriers in the future as companies will increasingly deploy mobile solutions to reduce costs, increase efficiency and improve customer service. As the reliability and performance of mobile enterprise solutions improves and the concerns about maintenance costs, data protection and integrity are addressed, corporations will increasingly adopt mobile solutions and LBS applications in their daily activities.”
An important opportunity exists for providers of location-based platforms such as Mobile Location Centers (MLCs). Ericsson, Telecommunications Systems (TCS) and Nokia Siemens Networks will be able to grow their LBS infrastructure business lines as carriers globally deploy LBS solutions.
The US has been the leading region for LBS deployments by carriers due to the E911 emergency calling regulation which has resulted in the ubiquitous availability of GPS-based CDMA handsets, but it is expected that Europe and Asia-Pacific will catch up as GSM handsets with built-in GPS receivers become widely available.
Carriers may not be the only players to benefit from this trend, as independent application and software providers are starting to offer carrier-independent LBS solutions, potentially relegating carriers to a role as mere bandwidth providers. Carriers will need to offer cross-network interoperability and open up their networks, says Bonte, in order to address this threat. [ABI Research]
Personal Navigation Market 2012: Asia-Pacific Will Overtake Europe and North America
Personal navigation has been one of the great consumer technology success stories of the past four years.
“2007 was ‘the year of the personal navigation device’,” says ABI Research principal analyst Dominique Bonte. “The estimated 11 million PNDs shipped in the US last year represent a fourfold increase over 2006 shipments. Handset-based navigation also fared well, and there was a renewed interest in outdoor GPS devices. New form factors emerged. High-profile mergers and acquisitions redrew the landscape of the navigation industry.”
2008 and 2009 will see continued success for navigation devices, with ‘connected’ PNDs becoming more important. Multimedia, speech recognition and Bluetooth will all start to appear in significant numbers. Replacement markets will slow the current erosion of device prices as the PND market consolidates.
Location Based Services will grow, driven by social networking movements and increasingly supported by advertising. By 2012 Europe, currently the world leader in personal navigation, as well as up-and-coming North America, will both have been eclipsed by the Asia-Pacific region in terms of market size, though regional patterns differ: A-P will favor handsets, while Europe holds fast to PNDs.
Much of the debate in consumer navigation markets revolves around whether or when offboard handsets will seize market share from PNDs. While they will certainly grow in popularity, especially in North America and Asia, ABI Research believes that they will do so only in pedestrian navigation, outdoor recreational use and LBS, while PNDs remain the form factor of choice for automotive navigation.
In an audio Webcast available on ABI Research’s website, Bonte provides a comprehensive overview of this market's performance in 2007 and the course it is taking in 2008, along with forecasts of device and system shipments through 2012. With a presentation liberally illustrated by charts and diagrams, he discusses the outlook for the future saying, “Winners and losers among consumer navigation vendors will be separated by time to market and agility, innovation, quality, community involvement, the availability of user-generated content, and effective branding.” [ABI Research]
Navigation Devices and Systems Will Generate Global Revenues of $62 Billion by 2012
Consumer navigation is quickly becoming an established consumer electronics category with more and more consumers discovering the benefits of navigation and related services. ABI Research forecasts navigation devices and systems to reach annual sales revenues of $62 billion by 2012.
“Despite disappointing sales levels in the first quarter of 2008 and profit warnings issued by TomTom, Tele Atlas and SiRF, the navigation market still faces a bright future,” says Dominique Bonte, ABI Research principal analyst. ”The current decrease in sales has to be seen as a logical reaction following the extraordinary sales growth during the fourth quarter of 2007, especially in the United States.”
The Personal Navigation Device (PND) remains the most prevalent navigation device type but is increasingly complemented by other form factors such as on-board and off-board handset-based navigation and low cost factory-installed in-dash systems. At the same time navigation capabilities are being integrated in an increasing number of new form factors such as portable gaming consoles and Mobile Internet Devices.
Consumer navigation is quickly maturing, with more reliable solutions being offered by a large number of vendors. While features such as text-to-speech and real-time traffic are becoming available on an ever-larger number of devices, new features such as pedestrian navigation, dynamic content and live local search on connected devices are being introduced, enhancing the navigation experience even further.
However, in an increasingly competitive and complex mass market, branding, communication, and market share are becoming key success factors, often achieved by consolidation and vertical integration. While the navigation market continues to grow and mature, the window of opportunity for small, innovative companies to stay in the market – let alone enter it – it is closing quickly. [ABI Research]
34% of All Portable Navigation Devices Will Feature Real-Time Two-Way Connectivity by 2013
The emergence of connected navigation services such as real-time traffic, live local search and map updates is prompting many PND vendors such as Magellan, Mio, TomTom, and Dash to develop connected personal navigation device (PND) solutions with two-way real-time connectivity based on cellular or Wi-Fi technology. By 2013, according to a new ABI Research study, 34% of all PNDs will ship with on-board connectivity.
“What’s at stake,” says ABI Research principal analyst Dominique Bonte, “is the generation of new recurring revenue streams in an increasingly competitive PND market characterized by spectacular price erosion. In order to be successful, connected PND vendors will have to design seamless solutions and compelling services, and adopt the right business model. They will have to embrace open development platforms to stimulate the design of third-party applications.”
Connectivity allows PND vendors to offer enhanced navigation experiences through optimized local search, dynamic POIs such as fuel prices, parking space availability and speed traps, real-time traffic and flow data, satellite imagery, online map updates, and even full off-board navigation. It also makes it possible to launch new services such as location-based social networking applications, and to use PNDs as commercial portable telematics devices for vehicle and asset tracking.
The most promising aspect of two-way connectivity is its ability to upload data in real time. This allows companies such as Dash to deploy connected PNDs as passive probes to collect real-time traffic flow information and redistribute it to customers. PNDs will now be used for the upload of user generated content such as map corrections, POIs and recommendations by communities. Upstream connectivity will also enable connected PND users to post their live locations on social networking sites.
All this will be facilitated by an emerging ecosystem providing tailored solutions for all levels of the value chain, such as dedicated chipsets for CE navigation devices from Qualcomm, a dedicated wireless connectivity solution from Jasper Wireless, a connected navigation platform from deCarta and a user interface framework from Intrinsyc.
The new report, “Connected Navigation Devices”, examines the features, trends, drivers and barriers of connected Personal Navigation Devices. It describes all major solutions, applications and business models and includes recommendations to the major navigation players. The study contains forecasts by region for shipments, hardware and service revenues of connected PNDs and services. It forms part of the Location Aware Services Research Service. [ABI Research]
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