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Satnav shares slump as Google muscles in
Posted on 29 Oct 2009 at 08:16
Google is adding Garmin and TomTom to its growing list of rivals as the search giant weaves turn-by-turn satnav into new versions of its smartphone software.
The new Google Maps Navigation product will provide real-time, turn-by-turn directions directly within mobile phones that are based on version 2 of Android. Google says the product, which will initially be limited to driving directions in the US, will be free for consumers.
The navigation product features speech recognition and a visual display that incorporates Google's online archive of street photographs. The software can also display live traffic data that Google collects from various sources.
The latest version of the iPhone, the iPhone 3GS, has the horsepower to support the navigation product
The launch represents a direct competitive threat to companies such as Garmin and TomTom which sell specialised hardware navigation devices. TomTom also makes a software navigation app for the iPhone that sells for around £60.
News of Google's entry into the market sent shares in both Garmin and TomTom plummeting. TomTom's share price was down by more than 20%, with a 47% slump in profits announced earlier in the day contributing to the downturn. Garmin's share price dipped by more than 16% on the news of Google's product.
Most requested feature
Google says that it decided to offer turn-by-turn driving directions in its four-year-old maps product because it was the most requested feature by users.
CEO Eric Schmidt claims that expanding into a new market with new competitors was not a part of Google's motivation. "Those are tactical problems that occur after the strategic goal which is to offer something which is sort of magical on mobile devices using the cloud," Schmidt claims.
The new navigation service will work with Google's forthcoming Android 2 software. The company announced development tools for Android 2 on Tuesday, although an official launch date hasn't been announced.
Tthe company is not currently serving ads on the navigation product, though executives claim Google is constantly looking at innovative ways to advertise in Google Maps.
Google Engineering Vice President Vic Gundotra says the company hopes to eventually make versions of the navigation product for non-Android smartphones, but notes that the software has "stringent" hardware requirements.
He wouldn't comment on whether Apple's iPhone, which offers Google mapping software as part of its standard menu of built-in applications, will offer the new navigation features. However, he claimed the latest version of the iPhone, the iPhone 3GS, has the horsepower to support the navigation product.
Gundotra adds the company won't collect any personally identifiable information in the Google Mobile Maps and the navigation products.
Author: Barry Collins and Reuters
Main SatNav problem is out-of-date maps
"Google says that it decided to offer turn-by-turn driving directions in its four-year-old maps product because it was the most requested feature by users."
So not really much practical use, then. Will Google be setting up its own Street Mapping department? Oh, it has already!
By JohnGray7581 on 29 Oct 2009 
Google Maps
Google Maps is four-years-old, but the maps themselves are updated regularly.
Barry Collins
Online Editor
By Barry_Collins on 29 Oct 2009
Competition rules?
What will the EU say about this? Free software competing against a paid marketplace?
By AdrianB on 29 Oct 2009
Ah, I see...
"Google Maps is four-years-old, but the maps themselves are updated regularly."
Thanks, Barry!
By JohnGray7581 on 29 Oct 2009
Connectivity?
Should work well out in the countryside where 3G connections are non-existent then ;-)
By shaunb on 29 Oct 2009
What will the EU say about this?
Good point, especially as the EU is wasting - sorry, 'investing' - billions on setting up it's own satnav system
By greemble on 29 Oct 2009
greemble - you've missed the point, it is setting up its own satellite positioning system. It still needs to work in conjunction with a mapping system (eg Google, TomTom) to be able to navigate you.
By halsteadk on 29 Oct 2009
mapping system
Fair enough, your right I did miss that - So I guess the EU will insist Google use their positioning system (when / if it's running) here in Europe.
By greemble on 29 Oct 2009
No - it is up to the GPS receiver hardware which satellite positioning system(s) it communicates with to get the position.
By halsteadk on 30 Oct 2009
System(s)
And as halsteadk's subtle "positioning system(s)" indicates, manufacturers will eventually be able to offer systems that work with both GPS and Galileo, thus offering the most reliable and accurate position.
By mhawkshaw on 31 Oct 2009
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