Boom predicted for GPS-enabled handsets

The number of GPS-enabled handsets is set to more than triple during the next five years, analysts have predicted.

In a report issued on Tuesday, the Swedish analyst firm Berg Insight said there would be 560 million handsets using the Global Positioning System worldwide in 2012, compared with 175 million units in 2007. The rise of such devices in Europe will be substantially more marked, according to the forecast, with an 18-fold increase.

"Last year marked the breakthrough for GPS outside the (U.S.) market, with successful product launches by Nokia and others," André Malm, a telecommunications analyst at Berg Insight, said Tuesday. "This year, we expect to see an abundance of new models supporting GPS from all major brands. By 2009, GPS is going to be a must-have in all high-end handsets."

Malm on Tuesday said handsets with the ability to draw location information from the United States-controlled satellite system were currently most common in those areas where phones are based on CDMA technology, such as in the U.S.

However, Malm suggested that the strong backing of Nokia in particular was starting to push GPS into more European handsets. While there were roughly 5 million GPS-enabled handsets in Europe in 2007, Malm claimed that the figure would reach 90 million in 2012.

Growth in the GPS-handset user base should also lead to more applications that use such information, Malm added, pointing to the success of currently available location-based services like Google Maps. "Perhaps it is not right to call them services, but small apps that use location as a filter or enhancement--we will see a lot of that going forward, once developers and users get more used to using location," he said.

Malm also claimed that the road map for GPS being rolled out into European handsets was not being hindered by delays in the establishment of Galileo, Europe's rival to GPS. Galileo has recently suffered funding crises, and it now risks falling behind rivals like Russia's Glonass system. As things stand now, Galileo is likely to become fully operational around 2013.

"I don't think (Galileo's rollout) is viewed as a very big obstacle at all," said Malm, contrary to suggestions made last year by an O2 executive. "It is moving ahead. It took a while longer than was anticipated, but that is usually the case with these large systems. GPS and Galileo dual-mode receivers will eventually be put into handsets, but that is not really an issue for the current road map."

Malm added that while Glonass is now "way ahead" of Galileo, in terms of deployment--it already has 13 operational satellites, with three recently launched additions set to go live soon--it is unlikely to rival Galileo as the choice of handset manufacturers that might be thinking of making dual-mode phones.

"It is technically more difficult because (Glonass uses) different signal structures (to GPS) and is not designed from the outset to be interoperable, unlike Galileo," he said.

David Meyer of ZDNet UK reported from London.