STRATEGY ANALYTICS: Cell Phones Take 30 Percent Slice of 88 Million Navigation Market by 2010; TomTom and Garmin's Easy Ride Over

BOSTON--May 24, 2006--The new Strategy Analytics report, "Portable Navigation: Vendors Face Consolidation and Automotive Fightback," concludes that at the right price points, cellular phone companies and traditional automotive system suppliers are now well-positioned to present a serious competitive response to the low cost, well branded navigation products from TomTom, Garmin, Magellan and others. Investment and competitive pressures are also expected to drive consolidation among portable navigation vendors in the next 12 months.

All navigation vendors will soon approach a strategic crossroads as strong latent demand for low cost basic route guidance is increasingly met. The Q4-05 Strategy Analytics survey of new car buyers across the US and Europe indicates that at least 18 percent of drivers require maps or directions more than 20 percent of the time. The vast majority of consumers, however, over 60 percent, only spend five percent of their travel time going beyond familiar destinations.

"There are now indications that Portable Navigation Device (PND) growth is slowing; and the demand from the smaller but highly significant segment of consumers who require route guidance on a regular basis has practically been met by low cost PNDs," says report author, Joanne Blight, Director, Automotive Practice. "The next challenge is to meet the needs of the much larger consumer segment who require route guidance on a far less regular basis. These consumers will require products that combine and integrate navigation with a range of other features, starting with road traffic information, but increasingly requiring entertainment and innovative location-based applications. The automotive and wireless companies are very well positioned to mount some serious competition in this section of the navigation market."

For a chart, "Total Navigation Systems and Devices Shipped," see www.strategyanalytics.com/press/PR00298.htm

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