LONDON Fierce competition and commoditization of entry-level personal navigation devices (PND) is likely to bite into the large profits made by makers of the devices over the past few years when sales grew at exponential levels, according to market research group Berg Insights (Gothenburg, Sweden).
The researchers say PND shipments in Europe and North America will peak at 56 million units in 2012 before stabilizing. Eroding prices are, however, expected to cause a decline in revenues as early as 2009.
“The personal navigation market has enjoyed phenomenal success in the recent years”, said André Malm, Senior Analyst at Berg Insight. “Since 2004 the market has grown from more or less zero units to approximately 37 million this year. Adoption is still increasing and many innovations are still to be made but from now on there will no longer be easy profits for anyone in this industry.”
Malm suggests vendors would increasingly seek to focus on value-added services that generate recurring revenue streams. Devices with mobile broadband connectivity will become more and more important, he adds.
“The Internet can take the navigation industry forward”, said Malm.
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