“Despite profit warnings the navigation market still faces a bright future” said ABI

However, “window of opportunity for small companies is closing quickly”

Dominique Bonte, ABI Research
Dominique Bonte, ABI Research
“Despite disappointing sales levels in the first quarter of 2008 and profit warnings issued by TomTom, Tele Atlas and SiRF, the navigation market still faces a bright future,” stated Dominique Bonte, ABI Research principal analyst this morning. ”The current decrease in sales has to be seen as a logical reaction following the extraordinary sales growth during the fourth quarter of 2007, especially in the United States.”

ABI Research forecasts navigation devices and systems to reach annual sales revenues of $62 billion by 2012.

ABI Research has identified several trends in this growing navigation market: the expanding number of platforms offering navigation, the sophistication of the navigation offering and the concentration of this market.

Growing number of platforms/form factors
“The Personal Navigation Device (PND) remains the most prevalent navigation device type but is increasingly complemented by other form factors such as on-board and off-board handset-based navigation and low cost factory-installed in-dash systems. At the same time navigation capabilities are being integrated in an increasing number of new form factors such as portable gaming consoles and Mobile Internet Devices”.

Sophistication of the offering
“Consumer navigation is quickly maturing, with more reliable solutions being offered by a large number of vendors” said ABI Research. “While features such as text-to-speech and real-time traffic are becoming available on an ever-larger number of devices, new features such as pedestrian navigation, dynamic content and live local search on connected devices are being introduced, enhancing the navigation experience even further”.

Market consolidation
In an increasingly competitive and complex mass market, branding, communication, and market share are becoming key success factors, often achieved by consolidation and vertical integration. While the navigation market continues to grow and mature, ABI Research believes “the window of opportunity for small, innovative companies to stay in the market – let alone enter it – it is closing quickly”.

Wednesday, May 7th 2008

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