ABI Research has just released a couple of new research reports that put a new spin on the troubles of the consumer navigation industry. Yesterday, the company forecasted a strong future for outdoor GPS handhelds, such as Garmin’s Oregon series, citing effective user interface design and social network integration. The latter is more apparent in Magellan’s Triton 2000 model that incorporates multimedia features such as a built-in camera and voice recorder allowing for web streaming. In fact, ABI figures that by 2013 outdoor GPS revenues will reach $1.7 billion per year. Not to shabby for an industry predicted to be dead by some long before 2013.
They also point out the continued growth of converged software solutions mainly due to decreasing prices and real-time connectivity, further fueled by competition between on-board software providers like Wayfinder and off-board vendors such as Augmentra.
However, ABI Research also states that while navigation may be popular in certain market segments, it still has a long way to go to mass market adoption. Sure, the company argues, high-end features like 3D maps, connectivity, multimedia, and on the manufacturer’s end, business models are important. But consumer navigation devices have only penetrated 20% of the North American and European markets and an entirely different focus will be required to move into ubiquity.
What does this focus entail? Says ABI Research Director Dominique Bonte, “First and foremost an uncompromisingly intuitive and simple navigation interface will need to be designed, combined with seamless multi-mode map updates, predictive traffic information, shorter GPS fix times and a wide range of dynamic and relevant content. In order to address the diverse user needs and behavior of all consumer segments, a large choice of form factors and price levels will have to be offered.”
It would seem to me that most of the major GPS software and hardware makers are already focusing on this. If anything, I think that all PND’s need to have a greater level of interactivity, via real-time connectivity, and deliver content behind that navigationally-related that is both locally and contextually relevant to the user (news, stock prices, etc). In otherwords, more units offering something similar to the Dash Express experience, but at a lower price. Therein lies the crux, thinning profit margins from falling prices don’t really give manufacturers incentive to cut prices without taking a loss. Some incentive.
There is an upside though. Emerging markets such as India and China are expected to explode with GPS devices over the next couple of years, albeit mainly in handsets, and with the incorporation of more markets, struggling bigwigs like Garmin and TomTom will have greater economies of scale, hopefully padding their margins comfortably enough that they can begin to offer the western markets the type of user experience required for mass GPS adoption. Or maybe Garmin should look at these markets as potential focus point for the nuviphone and scrap the PND altogether?
(Photo Credit: Isobel T)
