Strategy Analytics: Cell Phones Take 30 Percent Slice of 88 Million Navigation Market by 2010

According to Strategy Analytics, "at the right price points, cellular phone companies and traditional automotive system suppliers are now well-positioned to present a serious competitive response to the low cost, well branded navigation products from TomTom, Garmin (GRMN), Magellan and others. Investment and competitive pressures are also expected to drive consolidation among portable navigation vendors in the next 12 months."

Strategy Analytics believes that "all navigation vendors will soon approach a strategic crossroads as strong latent demand for low cost basic route guidance is increasingly met." A recent survey by the firm of new car buyers across the US and Europe found that "at least 18 percent of drivers require maps or directions more than 20 percent of the time. The vast majority of consumers, however, over 60 percent, only spend five percent of their travel time going beyond familiar destinations."

Joanne Blight at Strategy Analytics said, "There are now indications that Portable Navigation Device (PND) growth is slowing; and the demand from the smaller but highly significant segment of consumers who require route guidance on a regular basis has practically been met by low cost PNDs. The next challenge is to meet the needs of the much larger consumer segment who require route guidance on a far less regular basis. These consumers will require products that combine and integrate navigation with a range of other features, starting with road traffic information, but increasingly requiring entertainment and innovative location-based applications. The automotive and wireless companies are very well positioned to mount some serious competition in this section of the navigation market."

GPS-handsets and 3G networks seems the way to go for the casual user/mainstream market. However pricing will have to come down which is the current problem with most mobile services.

I've tried the TeleNav service on my Samsung A920 Sprint Power Vision 3G Multimedia Handset and the voice navigation was pretty solid the few time I used it. However at $9.99 a month it's expensive for the casual user who might need it 1-2 a month. As I've said before, the $5 range is the mobile service sweetspot.

So for now I'll just stick with Google Local and text directions for free....