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Blackberry Mobility Featured Article

January 21, 2010

Nokia Tries to Disrupt Navigation Market

By Gary Kim, Contributing Editor

Disruption in the communications and media business often takes the following form: a company starts offering “for free” a product another company sells for a fee. Skype (News - Alert) provides one example, at least in part.

The disruptive company then attempts to leverage the user base it gains to craft a new revenue model not based on direct end user fees but rather other revenue sources.
Google and Nokia (News - Alert) are essentially doing that same sort of think to the providers of subscription-based navigation services that also require special-purpose hardware. Where Garmin (News - Alert) or Tom Tom require special hardware and subscriptions, Google and Nokia believe “location” is powerful enough to create a new set of revenue streams from content, advertising, promotion and transactions.
Nokia has announced plans to release a new version of Ovi Maps for its smartphones that includes high-end walk and drive navigation at no extra cost, available for download at ww.nokia.com/maps.
This move has the potential to nearly double the size of the current mobile navigation market, Nokia says, and will include turn-by-turn voice guidance for 74 countries, in 46 languages, and traffic information for more than 10 countries, as well as detailed maps for more than 180 countries.
“Why have multiple devices that work that work in only one country or region? Put it all together, make it free, make it global and you almost double the potential size of the mobile navigation market,” says Anssi Vanjoki, Executive Vice President, Nokia.
Google earlier had released “no incremental charge” turn by turn navigation for its latest Android (News - Alert) devices.
For Nokia, removing the costs associated with navigation for drivers and pedestrians allows the company to quickly activate a massive user base to which it can offer new location features, content and services.
The move is also in line with Nokia’s vision that the next wave of growth will be centered on the location-aware, social Internet -- as the ‘where’ people are doing things becomes as important as the ‘what’ they are doing.
According to research firm Canalys, the number of people worldwide using GPS navigation on their mobile phones was approximately 27 million at the end of 2009. With this announcement Nokia potentially grows the size of this installed user base to about 50 million.
Nokia will further grow this base as it quickly adds more smartphones to the compatible devices list. Canalys also estimated in 2009 that the installed base of smartphones with integrated GPS was 163 million units worldwide, of which Nokia accounted for more than half (51 percent) having shipped cumulatively 83 million GPS devices.
By removing the added costs for consumers Nokia expects to fuel the take-up of mobile maps and navigation providing its ecosystem of partners with clear business opportunities:
Nokia believes service providers will be able to offer their customers a complete car and personal navigation package as well as encourage the take-up of data plans.
For third party application developers, Nokia believes location features will be important components of mobile app store software.
Ovi Maps is immediately available for download for 10 Nokia handsets, including the Nokia N97 mini, Nokia 5800 XpressMusic and Nokia E72, with more Nokia smartphones expected to be added in the coming weeks.
From March 2010, new Nokia GPS-enabled smartphones will include the new version of Ovi Maps, pre-loaded with local country map data, with high-end walk and drive navigation and access to Lonely Planet and Michelin travel guides at no extra cost.

Gary Kim (News - Alert) is a contributing editor for TMCnet. To read more of Gary’s articles, please visit his columnist page.

Edited by Michael Dinan

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