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Market Study
Published: January 2012
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Research from: telecomsmarketresearch
Sector: Mobile Content & Apps

Get up to date with the latest product and technology innovations from the navigation industry in Europe, North America and Rest of World with this report in the LBS Research Series. Find out what the industry leaders are doing and anticipate their strategies for the future. The number of mobile subscribers using a turn-by-turn navigation app or service on their handset was 130 million worldwide in 2011 and is forecasted to grow at a CAGR of 21.9 percent to reach 340 million users worldwide in 2016.

Mobile Navigation Services and Devices is the fifth consecutive report from Berg Insight analysing the latest developments on the global PND and mobile turn-by-turn navigation market.

This report in the LBS Research Series provides you with 160 pages of unique business intelligence including 5-year industry forecasts and expert commentary on which to base your business decisions.

This report will allow you to:

Profit from 30 new executive interviews with market leading companies.

Understand the dynamics of the navigation markets in Europe, North America and ROW.

Benefit from expert market analysis including detailed regional forecasts.

Learn about the latest mobile navigation propositions from device vendors and service providers.

Comprehend how navigation applications can integrate with other location-based services to improve the user experience.

Evaluate the impact of free navigation applications and evolving new business models.

Identify new business opportunities in connected services and real-time traffic information.

What are the latest developments
on the personal navigation market?
Navigation systems and services for car and pedestrian navigation can
be divided into multiple categories. Car manufacturers offer factory
installed in-dash navigation systems as standard or optional equipment
on a majority of their models sold in developed markets. Drivers that
want to add navigation to their existing vehicle can choose among a
number of aftermarket solutions. Examples include in-dash navigation
systems, Personal Navigation Devices (PNDs) and navigation apps
for mobile phones. New device categories such as Internet tablets are
also being equipped with GPS and navigation software. At the end
of 2011, there were 340 million navigation systems in use worldwide,
including an estimated 60 million factory installed and aftermarket indash
navigation systems, about 150 million PNDs and an estimated
130 million navigation-enabled mobile phones.
Even though the share of new cars fitted with factory installed in-dash
navigation systems will grow fast as prices decline, the actual penetration
of in-dash navigation systems will grow slowly. The average age of
vehicles in North America and Europe has grown to about 9 years and is
even higher in most other markets. Aftermarket navigation solutions will
thus account for a majority of navigation systems sold in the foreseeable
future. Since the different solutions are tailored for slightly different usecases,
multiple navigation-capable device solutions can be expected to
co-exist in the future. Many consumers are also likely to use more than
one category of navigation capable device.
In many developed markets such as Europe and North America where
the PND penetration is already high, the PND device category is facing
increasing competition from handset-based navigation services and
low cost in-dash navigation systems. Worldwide shipments of PNDs
fell to about 33 million units in 2011, down from nearly 38 million in
2010. Berg Insight believes that PND shipments in Europe and North
America have peaked and will gradually decline to about 7 and 6 million
units per annum respectively in 2016. New markets in other parts of the
world will only partly compensate for the decline in the mature markets.
Worldwide shipments of PNDs are forecasted to gradually decline to 23
million units in 2016.
Increasing competition has already forced several vendors to exit the
PND segment – either in the most competitive markets or altogether.
There is also a consolidation trend among the remaining PND vendors.
MiTAC has acquired the PND operations of Navman and the assets
of the consumer product division of Magellan Navigation. Garmin
completed the acquisition of Navigon in July 2011. United Navigation,
which began operations in early 2010, has licensed the rights to use
the Falk and Becker brands for navigation solutions. The PND market
is now dominated by the three vendors Garmin, TomTom and MiTAC
that together maintain a 75 percent market share. These companies
have highly integrated operations ranging from hardware and software
development to distribution. Moreover, these companies are now
increasingly focusing on in-dash navigation systems.
The adoption of handset-based navigation apps and services is
increasing along with the popularity of smartphones. The global active
installed base of smartphones surpassed 700 million units at the
2011, which is approximately 15 percent of all mobile phones in use.
Berg Insight forecasts that smartphone shipments will grow from an
estimated 450 million units in 2011 to 1,300 million units in 2016. In
the future, virtually all GPS-enabled handsets can be expected to have
mapping and navigation software as part of the standard feature set.
Today, handset navigation solutions are primarily available as on-board
apps with map data stored in the memory of the handset and off-board
services that rely on maps stored on a server. Over time, many solutions
will converge into hybrid services that store frequently used maps in the
internal memory and leverage wireless connectivity to access dynamic
content. The main distribution channels for handset navigation apps
include mobile network operators, handset vendors and on-device
application stores. Free turn-by-turn navigation services have been
available for several years from niche players, but the launch of Google
Maps Navigation for Android handsets in late 2009 and Nokia Maps
with free navigation in early 2010 started a major transformation of the
handset navigation market in both Europe and North America. Whitelabel
navigation developers are now working with mobile operators to
create unique localised offerings and service bundles. Increasingly,
navigation service providers are focusing on the freemium business
model where the core turn-by-turn navigation service is free and users
have the option to purchase additional content and features.

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