Driscoll Study Points Way to High Interest in Cellular LBS Applications

CJ Driscoll & Associates conducted their 2006 LBS, Telematics & Navigation System Study and found some not so surprising results. Sponsors who participated in this study included Toyota, Honda, Sprint Nextel, Cingular, deCarta and other high profile clients. Here is a snapshot of their results:

What is the consumer interest in cell phone-based navigation services?
8% extremely interested
14% very interested
43% somewhat interested
22% not very interested
24% not at all interested

What is the interest in location-based traffic information for route planning?
7% - extremely interested
19% - very interested
31%  - somewhat interested
19% - not very interested
25% - not at all interested
Mean interest was 2.6 on a 5 point scale

Of consumers interested in cellular applications other than the obvious voice communication, what are their top choices?
Here is the list that indicated that they were either “extremely interested” or “very interested”

22 cellular applications were included on the survey:

1.  Navigation assistance - 33% - the top rated service
2.  Traffic conditions for route – 31%
3.  Weather Information – 27%
4.  Send/Receive Text messages – 24%
5.  Find Points of Interest – 23%
6.  Monitor location of children – 23%
7.  Push to talk – 21%
8.  Send/receive emails - 21%
9.  Pedestrian directions - 20%

In summary, of the 22 applications listed in the survey, 6 of the top 9 were location-based services.

NAVTEQ Foresees Map Enhancements to Improve User Experience of PNDs

NAVTEQ conducted a study of users which revealed data that is leading them to improve their map database. Some of their findings:

1. When asked about potential map enhancements, which is most important? Answer: Better visual display of highway junctions.

2. Improve the orientation of a navigation system by including 3D models such as a translucent portrayal of buildings as they appear along a roadway or street.

3. Will the bend in the road curve? Users want to see prompts on the portable navigation device that shows data such as speed limit change that may indicate a curve. Ulitimately NAVTEQ believes that this type of information will lead to better speed management by the driver.

NAVTEQ will also begin to embed historical traffic models for be able to better determine what "should" happen on the roadway.

Hot Market for PNDs vs. Foreseen Revenue Flattening

So, the big question everyone wants to know here at the Navigation USA 2006 conference is ‘will personal navigation devices continue to grow in popularity or will they morph into some other consumer electronic device’ like as someone said yesterday "the device formerly known as the cell phone." For sure, everyone agrees…the market researchers (JD Power, Gartner), the device manufacturers (Motorola, Panasonic), and the value added sellers (DaimlerChrysler, Magellan)...this is a hot market. But many expect the revenue from PND’s to flatten after 2010. Cell phones are much more ubiquitous and the demand for "other" functions on the device is causing some concern. Everyone is waiting for the "killer app" that will extend the life of the PND. My take…security is the killer app. Why do people buy cell phones? Security…not to talk necessarily…but the peace of mind that comes with carrying a communication device…just in case. So, look for location-based security apps as a developing market…MyTornadoWarningAlert. Ok…these exist today from the web, but can you get them on your phone? For anyone who is using CAPs…the Common Alerting Protocol…used by the USGS, I’d like to hear from you.

Personal Navigation Device (PND) Market Size

The personal navigation device (PND: e.g. TomTom Go; Garmin i5 & nuvi; Magellan RoadMate) market is only 10% penetrated so says Peter Friedland, Managing Director of Soleil Group, a research division of Bain Capital. Friedland noted that 12 million PNDs will be sold in 2006: 2 million in the US; 10 million in Europe. Only 5 million were sold in 2005. By comparison with other hot sellers in the consumer electronics market, Apple sold 14 million iPods in 2005.

By 2010, Gartner’s Thilo Koslowski, VP and Lead Automotive Practice Leader, expects the PND market to grow to 30 million units with Asia/Pacific having the highest growth rate. By contrast, also by 2010, 497 million cellular phones will be GPS or A-GPS enabled compared with only 110 million today.

Quotes of the Day - Navigation USA conference

From the Navigation USA 2006 Conference (sponsored by TelematicsUpdate.com) in San Jose, CA…

"Navigation is a feature masquarading as an industry." Jim Nardulli, gate5/Nokia

"We refer to it as the device formerly known as the cell phone." Christian Bubenheim, VP Product Marketing, Motorola , when speaking about a new line cell phones that also act as a personal portable navigation devices, which may also have other features like an MP3 or video player.