For handset makers, it's all about location

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However, GPS chips are becoming increasingly cheaper for manufacturers to insert into their phones. Right now, GPS chips add about $10 to $15 to the cost of a phone, but over the next two to three years, it will likely only add $5 to $10 to the cost, Gold said. By then, though the inexpensive phones that carriers give away with service contracts likely still won't be GPS-enabled; 75 to 80 percent of high-end mobile devices, like Nokia's N95 and Apple's iPhone, will.

Some service providers and handset makers are already offering these types of location-based services, but they haven't yet reached the mainstream or are still a bit pricey. Sprint recently got a lot of attention for offering LBS for just $2.99 to tack onto any service plan.

Helio, the service provider that sells trendy youth-oriented handsets, incorporates LBS to allow Helio owners to find friends' locations. Sprint offers a similar feature provided by LBS company Loopt. The recently defunct Disney Mobile used the same technology to allow parents to keep tabs on their kids.

In February, the world's biggest handset makers, Nokia and Motorola, made news by introducing devices that incorporate location services. The move showed that neither was willing to wait for mobile service providers to take initiative in introducing navigation services for their customers. Nokia introduced a navigation phone with downloadable maps, and Motorola began offering a separate GPS receiver that turned Bluetooth-enabled smart phones into navigation devices.

As more handset makers get serious about navigation services, dedicated navigation devices are likely to be upstaged. "Those (companies) are going to fade to gray over the next couple years," Gold said. "It's very similar to the PDA market. No one really wants a single-purpose device" since almost everyone carries a phone anyway.

Still, though the number of GPS-enabled phones will soon eclipse the number of personal navigation devices, it's also important not to discount the benefits of a dedicated personal navigation device, said Ross Rubin, director of industry analysis for The NPD Group. Among them: The form factor allows for larger screens and different kinds of input options. And since they're separate, standalone devices can be used while talking on the phone. "Why do people still buy iPods?" asked Rubin. "There are just advantages to standalone devices."

 

Correction: A prior version of this story inaccurately stated the status of TomTom's acquisition of Tele Atlas. TomTom offered to purchase Navteq rival Tele Atlas this summer for just over $2 billion.

[ScottD74]

Who is next??

To my opinion the takeovers of Navteq and TeleAtlas are very expensive. Would it not be more logical to buy small companies who are able to use produce these maps as well at much lower cost and with low cost productions technologies? Just look at what the opensource people from OpenStreetMap have already been doing.

I am thinking about companies like AND Automotive Navigation Data from the Netherlands or Europa Technologies from the UK.

Anyways, I would be surprised if neither Garmin, Microsoft, Google, Apple, etc would not respond in any way.

[dargon19888]

There is no "next".

TeleAtlas and Navteq are it.

Its very expensive to literally map the globe and get the details that they do.

From the news.com other stories, I don't believe that these are done deals and that in both the TomTom and Nokia acquisitions, there still could be a bidding war.

[Steven N]

AND is a customer of the big 2

So you won't buy much new date, except for some minimal local data.
Like the other poster said, there is no number 3 of worldwide significance. The investment to create a full blown worldwide database is simply too big in the current corporate culture (fast growth, minimal costs). It takes years to build a geographical database, with huge resources involved (both technological as human), no company is willing to pour money into creating a third provider...
I took a look at OpenStreetMap, and while I really like the OSS idea behind it, there is no way this will ever grow into a product comparable to what Navteq or TA are doing

[TV James]

Wrong: Tom Tom did not buy Tele Atlas *YET*

http://www.news.com/Dutch-TomTom-launches-formal-offer-for-Tele-Atlas/2110-1036_3-6211127.html?tag=item

[ericaatnews]

You are correct

Thanks for catching that! The error has been corrected.

[omahasandman]

Device Poor? Not Really

"The availability of GPS chips in devices is the main barrier in mainstream adoption"

Not really...all mobile phones since 2002 have come location-enabled due to the FCC mandate around mobile e911. In fact all CDMA phones (Verizon, Sprint, Alltel) have AGPS chipsets allowing for very accurate location fixes. The barrier to entry as always is the business case. Out of any country in the world, the US is the farthest along regarding location-capable devices...Not always GPS, but AGPS and the like. More information on the FCC mandate is here: http://www.fcc.gov/Bureaus/Wireless/News_Releases/2001/nwl0127a.pdf

[Manhattan2]

New technologies around the corner

There are other companies out there to keep an eye on. GPSImaging.com might be next?

[Quemannn]

ergonomic designs for LBS

The next phase of developments in LBS will likely be

1)how to measure the rate of mobile multimedia consumption and
2)whether mobile handsets are ergonomically suited for mobile multimedia
3)how to harness vehicle dashtop to synergize mobility and the speed of multimedia
4)how to identify a new generation of mobile devices that can cope with battery life, screen sizes and ergonomic features suitable for users on the go, particularly at the wheel.

[swedeeb]

Impact on the Future of LBS

Nokia + NAVTEQ is a very important deal for the future of not only LBS, but mobile. Mobile and LBS will become so closely intertwined that it will be difficult to tell them apart. I am an LBS consultant and wrote an analysis on the deal and its future potential impact here: http://www.gpsbusinessnews.com/index.php?action=article&numero=408

[ScottD74]

AND

As far as I know AND is not a customer of the big 2. In the past they may have been customer of them, but not anymore. They are independent and deliver their date next to i.e. TeleAtlas en Navteq.

Look at some regions in the maps of Microsoft/Google.