TomTom Seeks New Direction

Standalone GPS manufacturers see huge growth from ’04 to ’08, then smartphones with GPS become mainstream. But since Android (and now iOS 6) has free turn-by-turn voice guided navigation, my question is what innovation have they brought in the last decade? Apart from fancier graphics, long-overdue live traffic and marginally bigger screens. Even non-smartphones have some degree of navigation ability, the day of the standalone GPS system is well past. There is simply no way to simply integrate all the services you rely on, with navigational context, on a device which is not your smartphone.

A large local retailer recently published an article (conveniently very closely placed to their comprehensive listing of GPS devices), outlining ways that these GPS units were better than smartphone GPS systems, nearly all of which were, at best, misleading. Stating things like ‘damage caused if lost is lower since it has no personal information’ ignores the fact that people tend to take their phones out of the car, compared to GPS units.

“TomTom said that in the three months to March, the latest figures available, the market for PNDs in Europe was down to 2 million units from 2.4 million a year earlier, while the North American PND market shrank to 1.4 million units from 2.1 million units. This is mostly owing to the growing popularity of smartphones, many of which have built-in satellite navigation and maps at no extra cost for users.”

“Mr. Goddijn is convinced the PND market will bottom out at some point; he doesn’t like to predict when, or at what level of demand. But he takes issue with investors’ perception of his company as a hardware vendor. “PNDs only contribute 35% to our overall sales,” he says. “This shows that we are able to generate [more] revenue from other sources.” TomTom also sells navigation applications for users ofApple Inc.’s iPhone, and earlier this month made a deal with Research In Motion Ltd. to provide maps and real-time traffic information on its BlackBerry smart phone.”

TomTom Seeks New Direction

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