The day of the in-car satnav may be over, with GPS smartphones like the Apple iPhone 3G outsripping their sales. Global shipments of satnavs or PNDs (Portable Navigation Devices) were down 6 per cent in Q3 2008 in EMEA (Europe, Middle East and Africa - falling behind shipments of smartphones with built-in GPS, which soared from 4.7 million last quarter to 10.4 million in Q3.

The story is different elsewhere in the world. In the same period satnav sales rose 14 percent year-on-year, from 7.7 million to 8.8 million units, with North America and Asia Pacific still seeing good volume growth, of 49 percent and 25 percent respectively.

Based on its latest research, Canalys estimates that:

  • - EMEA shipments of PNDs in Q3 2008 fell to 4.3 million, from 4.8 million in Q2
  • - EMEA shipments of smart phones with integrated GPS more than doubled from Q2, to hit 10.4 million
  • - At 70 percent, EMEA has a higher proportion of smartphones with GPS built in than any other region
  • - Year-on-year, global PND shipments rose 14%
  • - 49 percent year-on-year growth in North America compensated for a 6 percent decline in EMEA
  • - Garmin re-took the global PND market lead from TomTom, with Mio retaining third place

Garmin satnav

"Today, the volume of turn-by-turn navigation solution licences being shipped and activated for smartphones in EMEA is around 11 percent of the GPS smart phone total," said Chris Jones, Canalys VP and principal analyst.

"But with GPS being built into the majority of smart phones, and users increasingly being given maps on their phone by default, and multiple reasons to use them, the threat to PND vendors is rising quickly.

"The PND may give a better in-car user experience today, but smartphone vendors are learning and releasing new devices and software all the time. Nokia is already the third largest provider of mobile navigation solutions across all platforms in EMEA, behind TomTom and only narrowly behind Garmin."

Canalys suggests that the risk to PND vendors is likely to rise further as the economic situation forces more consumers to take a hard look at their discretionary purchases.

"We can't live without our mobile phones, and if they have satellite navigation built in it is inevitable that this will stop some from buying a PND. Those who have not yet bought their first PND are likely to be more ‘occasional' satnav users for whom a phone-based solution will usually be good enough," added Canalys analyst Caroline Chow.

An increasing number of new smartphones include GPS, most notably Apple's iPhone 3G. Garmin recently delayed its own Nuvifone "iPhone killer".

Apple iPhone 3G GPS

"The key to upgrading such users may be delivering genuinely useful, real-time location-specific data, such as traffic information and fuel prices, but the leading smartphone vendors are better positioned, in terms of having a base of users already paying for services on connected devices, and of course the operator relationships, to capitalise on this need. PND vendors should not underestimate the challenges of moving over to a connected device business model."

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In the global PND market in Q3, Garmin re-took the lead it narrowly lost to TomTom in Q2. Shipments of just over 3 million PNDs gave it 35 percent market share, ahead of TomTom's 29 percent. Mio rounded out the top three with a 9 percent share of the market (including its devices branded as Navman).

Consolidation and price-cutting continued to take their toll on the industry, with smaller vendors finding it increasingly difficult to compete. Total market value declined 21 percent year-on-year, despite the 14 percent rise in units shipped. The share of the market taken by the top three vendors continues to rise, with the absolute volume of shipments of all other PND vendors falling to their lowest level since Q2 2007.

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