The Garmin NuviPhone finally hits the shelves in Asia . The device has been nicknamed Neverphone because it was announced at the Mobile World Congress 2008, so nearly 18 months ago. I was on the edge to close a deal with Garmin in 2008 to embed their software in the Toshiba devices when they annonced their Nuviphone. Of course we stopped the discussions as it is not comfortable to compete with one of its suppliers. 😉
This time Garmin has teamed up with Asus to produce it and it comes preloaded with satellite navigation software and maps. Basically is no more than a phone bundled with a satellite navigation software as you can find already many from HTC, Toshiba or other manufacturers. Nothing really new except the brand which is one of the most famous in the PND space.
I’m a bit doubtful of Garmin’s approach as their Nuviphone will compete with Operators’ navigation services and Operators control nearly 85% of the handset market in Western Europe.
As the ASP (Average Selling Price) of PND (Portable Navigation Device) is dramatically falling, legacy PND manufacturers such as Garmin and TomTom have to adapt and re shape their strategy quickly.
TomTom the other big player in the PNDs is changing its market approach too. After having left the smartphone space in 2008 they are back with the 1st satellite navigation software for the iPhone. It is a very clever move as TomTom is not so strong in North America, where they are struggling behind Garmin.
But the most interesting move from TomTom is their LIVE SERVICES. TomTom is trying to sell connected PND, i.e. PNDs with a 3G SIM Card, and the services directly to the end user. They buy the SIM card and data traffic from the mobile operator at a wholesale price and sell the connectivity and the services embedded in the device. The services encompass:
- real-time traffic information on motorways and secondary roads
- fuel prices in real time
- local search with Google
- weather, etc.
The challenge is really a test for the whole mobile industry as, if it was to succeed, it would prove that it is possible:
- to switch a business model from a hardware based to a service based business model
- to compete with mobile operator in the connected service space which they consider their private backyard
Both 2 things, no other player has been able to do successfully as of today.