Nokia Deal Having Impact on Garmin

Though markets aren’t perfect, the news of Nokia acquiring NAVTEQ has had an immediate impact on Garmin (GRMN) in which investors appear to be suggesting that it missed an opportunity. At mid-day, the stock is down over 10% and TheStreet.com thinks that GRMN will pay more for the street data and finds itself left out of a market where their competitor, TomTom now has sole possession of one side of the duopoly, Tele Atlas. TheStreet.com thinks the big issue is the new market for pedestrian navigation, which Nokia itself made very clear in its conference call this morning. I think that may be a red herring and the bigger play is for in-vehicle systems at least that’s where the margins will be higher. In fact, I see the issue for Nokia is that they see an opportunity to control more of the communication electronics for in-vehicle systems starting with navigation and continuing to cellular and Wi-Fi - based applications. Regarless, Nokia is shining a spotlight on LBS applications as a strategic part of its business.