Tag: Google Maps

Ralf HallerRalf Haller February 13, 2010

Views on the state of the Navigation software markets

The navigation software market seemed to have been under heavy commodity pressure recently. With Google providing free navigation now for all Android phones, NOKIA felt they had to pull out something too also in light of Apple’s iPhone success. Of course the $8.1 billion they spent on Navteq needed to also put to work quickly. Unfortunately they did once more not get the end user requirements and decided to confuse people by offering free maps (for some of their handsets) and free turn-by-turn voice-directed navigation (again for only some of their handsets and confusingly different ones than the few who have free maps).

So where is this all leading and what can we expect in this market to happen?

In my opinion NOKIA will once more not be able to profit from this new development. They did not only enter this opportunity too late, spending also way to much money on Navteq but also screwed it then up with confusing licensing terms and announcing FREE in the headlines when in fact the small print shows that this is only true for a few handsets. Google will go its path and probably soon offer the best location based and real world viewing experience and that for free. With that move they will put a huge amount of pressure on the other navigation companies to innovate even more and faster. Navigon and TomTom have clearly seen this pressure and reacted with price cuts and many new developments such as 3D map views, voice activation, alternative route suggestions based on driving habits or real-time traffic situations. Both offer their products now on the iPhone with nice mounting cradles to use it in the car. TomTom even has one with a built-in GPS receiver chip to improve the navigation for the iPhone and enable the iPod Touch as well. But both vendors face a dilemma that is hard to fight: pricing drops drastically while at the same time more and more devices and features seem to be required to be able to offset this trend with more unit sales. They need to streamline their production costs and reduce hardware to very few platforms while putting all efforts into software development. Location based services is the way to go as well as combining it with social networking but while this is easy to say it requires a totally new approach and most importantly new business models where also online and mobile ads should be looked at. Both companies need new talent that are experts in online ads and social networking. I doubt though that they will be able to pull that off quickly enough which will make them acquisition targets maybe for other mobile phone vendors. Of course currently their navigation devices are still better than Google’s since they can clearly profit from years of experience in the car navigation market, but that gap will shrink quickly in the next 2-3 years if not even faster.

Garmin needs to be mentioned as well. The company did a smart move understanding the danger of commodity markets obviously very well and was branching out into all kinds of vertical markets with specialized products (flying, boating, trucking, hunting, hiking and all kinds of sports). It will be much harder to compete against them by Google and since they are established now in many of these vertical markets TomTom and Navigon are simply too late to copy that business model and most likely also don’t have the cash to do so. So I think Garmin looks fine while the rest will face tough times ahead.

Ralf HallerRalf Haller July 1, 2009

Latest hit on the iPhone: professional mobile navigation software

I noticed it a few weeks ago when I saw that the German GPS navigation company Navigon provided their navigation software for the iPhone that they quickly showed up in the Top 10 list in the AppStore.

Now Navigon is number one paid app in the Navigation category and based on the huge number of reviews (250) in a league with e.g. the very popular game Brain Challenge.

Navigon offers two versions currently: a European and a D-A-CH (Germany, Austria, Switzerland). It supports also many languages: English, French, Spanish, German, Italian, Swedish, Danish, Norwegian, Finnish, Dutch and will have even more in the near future.

While the price is very high for an iPhone app (105 CHF and 69 CHF) for the two versions it is relatively cheap compared to buying a complete navigation device. Also this app seems to close a gap that neither Apple nor Google’s Android phone could close so far (not to mention the mobile operators who are loosing out it seems once more here too) and that is for a professional navigation system. There are GoogleMaps based GPS projects under way, but they are still in a stage where I would not use it and rely on it to find my way on time to a meeting in a new place. Of course they will improve over time as well but I think this will take a while and possibly never reach the quality of Navigon.

Now that Navigon has started this they should not stop but expand the functionality to much more location based services and join forces with many other apps that you can find already in the AppStore. They could become a platform for many of them. If they take that opportunity will have to be seen though. Navigon being a German company I doubt that they will succeed in this or even try as this is not something that comes natural to German companies. ¬†They very typically stick to their own ideas and don’t use extensive partnering as a way to distribute their brands. That’s one of the reasons also why hardly any German software company was able to build an international success unlike so many US software providers. But maybe I am wrong and if so Navigon could have a stellar rise from here. Let’s see…