January 6, 2009

GPS Industry - What's Next?

On the eve of CES 2009, I can't help but ponder what's next for the GPS industry given the dire situation in the economy and the confluence of technologies and products that are running smack into the tightly closed wallets in American's pockets.

Where are we at?

  • Dominant Players Keep Challengers at Bay - Over the last year, TomTom and Garmin drained the pond and ran for the low end launching and maintaining their presence with value models, all but removing the need for second and third tier brands whose sole offering was price beater. When you could save $80 on a unit by switching brands to "Fly by Night GPS Model A", it's meaningful, but when it's $20, why not go with the trusted name. It will be interesting to see if TeleNav can launch into a targeted market with a higher end innovation of the connected GPS in all of this. It goes against the grain of cheapie units entering from the bottom of the market; they are also experienced in software design from their mobile phone based navigation capabilities. Their interface needs to be good, and the market willing, in order to make any money.
  • People are thinking about skipping that GPS purchase - in a Wall St Journal article yesterday (p.B3) they reported that 62% of participants in a survey were less likely to buy a GPS given the state of the economy. The survey was conducted in November, potentially spelling out the poor holiday season that we just went through.
  • Black Friday Every Day - TomTom planned to bring the price of their ONE 125 unit back up to $129 after Black Friday, but it's now $99 almost everyday online. Either they are doing really well and not moving much else, or there's a lot of inventory to move. TWICE indicates that in their conversations, inventories at key retailers are high. Black Friday quality deals are all over the place as retailers are trimming inventories and the buyers are the victors. Go with quality, and you'll make out.

Where is this all going?

  • Consolidation - we have already seen Magellan get bought up by Mitac, Mio's parent company, and I would expect that only the strong will survive this recession and technology shake-out. While the in-category consolidation takes place, don't rule out a broader consolidation; think mobile phones, maps, location based services, and GPS units all being run out of the same shop.
  • Streamline the Line - As we eek towards decent connected offerings, we will see the GPS category morph into a few general offerings. If you don't have these you're not a complete player.
    1. Low End Value - grab the Point of Market Entry consumers, keep the cheapie rivals out of the cookie jar.
    2. Mid-Point with move-up features - nicer benefits, higher quality user experience, and more profits available per model.
    3. High End Connected Wannabe - Should be fully connected, but isn't and should have a limited appeal. Offers services that are better when there's more bandwidth; think traffic here.
    4. Over the Top Connected Lifestyle - Gooped up with loads of features, and really where the fun is at. Takes effort and skill to make this work.... oh yea, and willing buyers that we haven't seen enough of yet.
  • Connected GPS Services - yes, they will come, the consumer need is there and the benefits can be great. Dash flew a little too close to the sun and it didn't work out in the first iteration for them, but they had a grand vision of networked traffic, customized search capabilities, and local content. The issue here is in solving the monthly fee concern, and the visualization of the benefits, and the interface that can support the benefits clearly, etc. Can consumers swallow another monthly fee for their device, especially in a recession? The answer might be in taking an "add-on" like a personal navigation device, and turn it into a "must-have", like a mobile phone - something like the Nuvifone. An issue to solve here is that phones need to be relatively small, but we want large GPS screens....
  • GPS/LBS Everywhere - There's a benefit to having location awareness, and it's coming to a device near you. We are already jogging with you, biking with you, in cameras, in Radar Detectors, phones, in computers, in cars, in nativity scenes, and just about anything you can hook a data logger to. When things are location aware, ads can be sold for location sensitive businesses; think the coffee shop, or the local restaurant, and this money can help drive the whole business cycle, and potentially subsidize you costs.

For now, we'll see what turns up at CES, and monitor the deals and bargains for you. Stay tuned, it's always an interesting ride.



Read More in: CES 2009 | GPS News

Share this Article with others: social bookmarking

Related Articles:

Came straight to this page? Visit GPS Lodge for all the latest news.

Posted by Scott Martin at January 6, 2009 7:59 AM

Recent Comments

Post a comment









Remember personal info?




Please enter the letter "v" in the field below:
Please press Post only once. Submission of comments takes up to 20 seconds because of Spam Filtering.
Join the Mailing List Mailing List
Enter your Email


Powered by FeedBlitz

facebook_badge.jpg twitter_badge.jpg

Subscribe - RSS
Site Navigation

Visit our other properties at Blogpire.com!

Archives

TechPiree

This weblog is licensed under a Creative Commons License.

Powered by
Movable Type 6.3
All items Copyright © 1999-2017 Blogpire Productions. Please read our Disclaimer and Privacy Policy