Blog Post

Garmin And TomTom Get Lost As Smartphones Begin To Offer More GPS Features

Add maps and directions to the list growing list of features that a smartphone can do, just as well, if not better than a standalone device. As traditional GPS companies are scrambling to find a way to stay relevant, TomTom and Garmin try offering a range of new products and services, ranging from building new hardware designs to developing software applications for the smartphone market.

The NYTimes reports that the odds of people buying both a smartphone and a GPS unit are dropping off a cliff. Already, more than 40 percent of all smartphone owners use their mobile devices to get turn-by-turn directions, according to data from Compete, a Web analytics firm. For iPhone users, the figure soars past 80 percent. In addition, shipments of smartphones in North America are expected to grow by 25 percent this year, with more than 80 percent of them coming with GPS, according to ABI Research. Meanwhile, sales devices from TomTom, Garmin and Magellan units — which can cost as much as a phone — have fallen sharply.

GPS devices still have their perks. For instance, they can render maps faster because the data is stored on the device, rather than having to be refreshed via a cellular connection. It’s also nice to have a standalone device so that you don’t drain your phone’s battery. But now that phones come equipped with voice commands, real-time traffic updates, and can map out directions directly from an address stored in your phone, having one device to handle both needs is more convenient.

The GPS companies are taking a number of different approaches. Amsterdam-based TomTom is building an iPhone app that will feature turn-by-turn directions. Consumers will pay a one-time fee for it, rather than a subscription. Meanwhile, Garmin plans to release a phone that includes navigation, called the Nuviphone later this year. But there’s also the carriers to consider, which have also offered their own branded navigation services. AT&T (NYSE: T) recently released the Navigator application for the iPhone App store, which is free to download, but will cost iPhone subscribers $9.99 a month to use.