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GPS Window of Opportunity May be Closing

Worldwide shipments of GPS-integrated mobile devices will grow at an annualized rate of nearly 40 percent over the next five years, reaching 834 million units in 2012, according to a market study by Parks Associates.

Their latest report looks at a variety of mobile devices, including personal navigation devices (PNDs), mobile handsets and smartphones, portable media players, and personal digital assistants (PDAs).

Mobile handsets and smartphones will constitute the majority of shipments up to 2012, but PNDs will remain the most widely used and preferred navigation choice in the next three years, said Harry Wang, senior analyst, Parks Associates.

"GPS will come to your mobile handset as a standard feature, but mobile carriers are still a couple of years away from turning GPS into a money-making, mass-market feature," Wang said.

Currently, consumers prefer PNDs thanks to the combination of a bigger screen, more versatile functions, and new lower pricing. Therefore, I've wondered if the window of opportunity is actually still fully open for mobile phone service operators.

"The use of navigational services on mobile phones will lag behind adoption of PNDs and GPS-integrated handsets in the near term," Wang said. "Carriers can boost consumer interest and usage by developing flexible and innovative services and revenue models."

The wild card, of course, is the GPS-like developmental work that Google is currently doing within this space. IMHO, they can disrupt some of the volatile half-backed SP business models that assume the revenue opportunity will still be there when they finally go to market.

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