More cellphones can now lead us precisely to our destination, thanks to cheap chips that talk to navigation satellites. So will we dump all the navigation gear that is a hot-selling item this holiday season? Not soon, analysts agree.
There's no beating the bigger screens on stand-alone GPS, says Caroline Chow, a market analyst at Canalys. The bigger screens on what the industry calls "personal navigation devices" make directions easier to follow and easier to access than on a cell's small display. And navigation is simpler on PNDs because that's their primary purpose. The benefits outweigh the costs, especially with today's prices crashing below $100 for starter PND models. "I'm amazed at how low they're selling these things," she says.
Device makers like Garmin, TomTom, and Mio have done a great job at making a complicated function—navigation—simple to use, says Richard Robinson, a market analyst at iSuppli. "PNDs currently enjoy very high user-satisfaction ratings," he wrote in a recent report. The device makers need to guard that advantage over cellphones and not add too many extra functions, such as viewing digital pics and videos.
Cell companies also collect a monthly fee for navigation and sometimes charge for airtime, Robinson wrote. Those fees confuse and discourage consumers, who like the simplicity of the one-time charge for a dedicated navigation device. In short, while GPS-enabled phones pose a threat, all signs point to a growing market for PNDs.