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Will mobile navigation spell doom for PNDs?

When Google (NASDAQ:GOOG) released its Google Maps Navigation application for Android, featuring turn-by-turn directions, live traffic updates and voice control, the stocks of portable navigation device–makers and GPS competitors took a sizable hit. Android might only capture a small fraction of the smartphone market today, but with innovative — and free — apps coming like Google Navigation, as well as a general spike in mobile GPS activity, PNDs could become a thing of the past.

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Even before Google brought its app to the Motorola Droid last week, mobile navigation was on the rise. Users increased two-fold in 2009 to 28 million, according to Berg Insight. The firm expects mobile navigation subscribers to continue to grow at an annual rate of 33.7% until 2015, when it will reach 160 million users worldwide. The growth is being driven by the broader availability of GPS-enabled handsets and the bundling of navigation apps with mobile devices and service plans. In the U.S., adoption of mobile navigation services has already passed 3%, a small number, but nonetheless notable.

PNDs, meanwhile, used to be a hot space a couple of years ago, but they have cooled off in the face of the recession and increasing competition. In 2007, In-Stat said global shipments of stand-alone navigation devices grew 131% from the year before but are forecasted to grow just 19% this year compared to 2008. Companies such as Garmin and TomTom have developed sophisticated in-vehicle devices for turn-by-turn directions, navigation and, in some cases, a built-in Internet connection to make the updates real-time, but the competition in the market has also caused prices — along with profits — to drop. The smart PND companies are partnering with mobile vendors to build apps and services around their navigation model and offset declines. Garmin even took it a step further, launching its own phone, the Nuvifone, although it has so far received a lackluster reception.

PNDs always had screen size and the ability to show large, detailed maps going for them, but with advancements in mobile phones, even that advantage is being less defined. These dedicated devices fall into a category of fourth-screen consumer electronics that shows potential, but also has a serious set of challenges working against it. The largest challenger will continue to be highly capable, Swiss Army–style mobile phones that do a lot of functions well — or in the case of Google Navigation on the Droid, extremely well.

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© 2014 Penton Media Inc.

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