Mobile phones beat dedicated navigation systems

August 15, 2011 // By Christoph Hammerschmidt
German IT industry association Bitkom observes significant shifts in the market for navigation systems. The association expects that in the current year the number of dedicated navigation systems will decline by 11 percent; at the same time, the number of navigation apps for mobile phones and tablet computers will rise.

Bitkom believes that the industry will sell 3.1 million navigation systems in Germany in 2011, down from 3.5 million units in 2010. In other European countries, the trends are similar. The experts see two main reasons for the shift: Once, the market for dedicated systems is approaching saturation, and second, the navigation apps are increasingly powerful and at the same time very affordable. "Every third household already has a navigation system," Bitkom vice president Heinz Paul Bonn said. "In contrast, only on four percent of all smart phones such an app is installed".

At the same time, the average selling price for navigation systems continues to decline. Currently, in Germany the ASP is about 130 euros; three years ago, the price averaged at about 200 euros. "For navigation systems, the same wisdom holds true as for all IT solutions: While the computing power increases, the price falls," Bonn said. Even current entry level solutions offer features such as alternative routes to circumnavigate traffic stalls, lane recommendation, or speed limit displays. 3D map display, voice control, and integrated hands-free interface or pedestrian navigation are typical extras. Nevertheless, smartphone apps are getting increasingly more powerful and feature-rich. "They will offer more and more additional functions, such as support for calling taxis or integration into social networks", Bonn said. He added that tablet computers are ideally suited for in-vehicle navigation purposes, provided suitable holders are available.