GPS navigation: Phone vs stand alone

We previously pondered how dedicated GPS car navigation services would compete with the rising popularity of cell phone-based GPS navigation services. Mobile networks can offer connected features and the ability to easily navigate from wherever you are, while the stand alone GPS navigation market is vulnerable from commoditization and increased competition. The Wall Street journal asks that question this morning, and points out that Nokia plans to add free navigation functionality on its new N95 mobile phone.

The WSJ quotes a TomTom spokesperson as saying:

TomTom says it isn’t worried about competition from mobile-phone makers, as “screens on mobile phones simply aren’t large enough for in-car navigation,” Mr. Titulaer said.

That’s a pretty poor argument, because that’s where audio-based directions come in. Rather than pointing at the shortcomings of the mobile market, the stand alone companies like TomTom should make sure their devices and services are that much better than the basic ones being offered on cell phones.

Both markets are growing rapidly, but big mobile players like Nokia who can afford to give away navigation service as a differentiator on a new phone may help turn navigation into a standard cheap or free service. If all phones one day offer free navigation, would someone pay extra for a stand alone device for a car? Only if it offers a significantly better experience. TomTom, you should probably start mapping out some plans.

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