Does Google Mean Business? You better believe it!
The commoditization of voice directions has long been anticipated. Google has been preparing for this strategic move for some time too: The Google Mobile Maps user base is a powerful beach head; they have reduced content costs (maps, routing and traffic) by saying goodbye to TeleAtlas (owned by TomTom). Furthermore they have avoided a conflict of interest with TomTom's navigation market share being a prime target; and Google can reduce the cost of ownership of an Android phone. Google may also feel justified in their desire to crush the lucrative GPS navigation market, after all, navigation companies have been offering local search, gas prices and movie search for some time - definitely Google's turf.
What is the Threat to Mobile GPS Navigation?
So what are the threats for incumbent GPS Navigation companies. To some extent each incumbent is insulated, in the short term, according to whether they are mobile or PND. NIM and Telenav, as mobile GPS navigation solutions, are protected by their close relationships with carriers. Carriers, who continue to determine on-deck / white labeled services, may preserve non-Android OS phones as a compromise. NIM and Telenav also have a strong presence on feature phones as well as smart phones. Feature phones are tough for Google to convert. But over the next two years more feature phones will upgrade to smart phones and many to the cheaper Android platforms. Pressure, during a 1-2 year window, will breakdown the carrier / nav alliance forcing NIM and Telenav to undertake new product and business model innovation.
What is the Threat to PND companies?
TomTom and Garmin PND divisions have been on the defensive for some time. The PND is a mature product, to be substituted for mobile devices, and Garmin's mobile phone is not a winner. Google's GPS navigation again does not have an immediate impact, as much of Tom Tom's business is now content and Garmin's business is enterprise. However the turbulence will affect 1-2 year forecasts.
What are the Strategic Moves:
1) In the short term access as well as quality will be the differentiator. Since Google and Traffic.com launched their new FREE traffic products on BlackBerry, Proxpro Prompt's business has increased 64% and Prompt remains the top paid traffic app in USA.
2) In defense we'll see carriers and mobile GPS navigation companies continue to bundle navigation into data plans, hiding the real cost of provisioning these services.
3) There will be a massive focus on product innovation. Augmented reality and augmented intelligence applications including Prompt's GPS Calendar, traffic early warning systems and time to leave alerts.
4) New business models will evolve strong enough to support navigation costs.
Julian Bourne
Prompt - GPS calendar and traffic early warning system
Available on BlackBerry App World
www.proxpro.com