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North America overtakes EMEA as largest satellite navigation
market
- Garmin retains global PND lead, smart phones become the new
battleground
Reading (UK) - Monday, 16 March 2009
For immediate release
North America overtook EMEA (Europe, Middle East and Africa) as
the largest regional market for PNDs (portable navigation devices)
in the final quarter of 2008, according to the latest research from
Canalys. In Q4 2008, the US alone accounted for 52% of the worldwide
PND shipment total, compared to 36% for EMEA. “The US has continued
to deliver unit growth year-on-year, despite the economic situation,
but this is supported by very aggressive pricing – especially for
holiday promotions,” said Chris Jones, Canalys VP and principal
analyst. “Shipments in the US were up 20% in Q4, and 44% for the
whole year. In contrast, EMEA was down 26% in the quarter, bringing
global shipments for Q4 down 4%.”
Garmin retained its worldwide PND lead, increasing its market
share in the quarter to 37%, up from 35% in Q3 and from 30% in the
year-ago quarter. TomTom kept second place, also increasing its
share, taking 30% of the market in Q4 2008. The combined shipments
of Mio and Navman put MiTAC in third with 6% share, narrowly ahead
of Nextar.
For the whole of 2008, PND shipments globally grew 18% over 2007,
to around 41 million units, but the value of those shipments fell
16%, highlighting the price war that has been raging in the
industry. Canalys estimates that more than three-quarters of the
PNDs that shipped in Q4 were priced below €200 (US$250) before tax,
and that connected PNDs, which are typically at the higher end of
the price range, represented less than 1% of the total shipments in
Q4. “One of the challenges facing vendors of the new breed of
connected PNDs is that the market has been educated to expect very
low prices,” said analyst Caroline Chow. “These devices offer useful
live information for the driver, but come at a premium that few are
willing to pay, especially in the current climate.”
A consumer survey run by Canalys in November revealed that more
than a third of PND owners described real-time traffic as a ‘must
have’ in their next device – above any other feature listed. A fifth
of the 2,400 consumers surveyed said that, in the previous six
months, they had got stuck in traffic and wished they had taken a
different route more than six times – 10% said it had happened more
than 10 times.
“The need for traffic information is clear, but vendors need to
work on changing people’s perceptions of what a GPS navigation
device is for and hence the value it delivers,” Jones added. “Over
80% of users surveyed said they ‘never’ or ‘rarely’ use their device
on their regular journey to work. When asked the main reason they
bought the device in the first place, 70% gave an answer related to
use on unfamiliar routes, while only 8% mentioned the daily problems
of avoiding traffic or to get warnings about safety cameras.”
The need for dynamic information, combined with current
perceptions of PNDs and device costs, will be good news for the
smart phone vendors who are also focused on providing connected
navigation and other location-based services. Canalys research
indicates that over 4 million phone-based navigation solutions
shipped in Q4 – more than double the figure of a year earlier. But
this area is led by companies such as Nokia, TeleNav and NIM – who
combined account for three-quarters of the market – rather than the
likes of Garmin, TomTom and Mio. With more than 70% of smart phones
now coming with GPS built in, this part of the market is destined
for substantial growth over the next few years. Garmin will hope its
alliance with Asus and recently unveiled nüvifones will help it
break into the very competitive smart phone world, but, as others
have found, getting devices ranged and subsidised by mobile
operators will be a huge challenge.
About the research
The research and shipment estimates discussed in this release
come from the market-leading Canalys Mobile Navigation Analysis,
Smart Phone Analysis and Consumer Mobility Analysis services.
Canalys’ globally consistent market segmentations and definitions
are used by vendors the world over to provide a coherent view of the
mobile device and applications markets. Canalys offers services
looking at the markets by country in Asia Pacific, North and Latin
America and EMEA, as well as providing global market overviews and
survey-based analysis of user attitudes and preferences toward
mobile applications, devices and services.
About Canalys
Canalys specialises in delivering high quality market data,
analysis and advice to the world’s leading technology vendors. It is
recognised as a key provider of continuous advisory services and
confidential custom projects for marketing managers and strategists
within blue-chip IT, telecoms, navigation and consumer electronics
companies. It has unrivalled expertise in routes to market for all
kinds of high technology products and services in the consumer, SMB
and large enterprise segments, and provides worldwide market data
and trends analysis.
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