GPS Navigation: Nokia Looks to Cars

While we’ve been somewhat skeptical about the market for certain location-based applications for mobile devices, the market for GPS-navigation services is actually taking off. Nokia is betting big on the GPS market, and today the company announced its first dedicated GPS auto-navigation device, the Nokia 330 Auto Navigation, which will be available in the European market in the fourth quarter of this year. Previously Nokia also did a deal with Trimble, acquired navigation company gate5, and has been pushing navigation for its N95 phone.

The Nokia 330 is a 360-euro ($450) stand-alone navigation device and competes with devices from companies like TomTom, Garmin and even Silicon Valley startup Dash Navigation. It will be interesting to see as more cell phones add GPS navigation services, how many consumers will prefer to use an in-car-only system, versus how many will prefer a cell phone navigation application. With this move Nokia seems to be trying bet on both markets, though, it would be reasonable of Nokia to somehow enable the 330 to connect with cell phones.

Less than seven percent of U.S. cars have GPS navigation, according to CJ Driscoll & Associates, but only around 0.5% of the world’s cell phone users pay for any of the many GPS-based mobile services, according to ABI Research. When cell phone-based navigation applications become more common these services could compete effectively with lower-end stand-alone car navigation services, which have been long been considered more sophisticated. At the same time in-car products are trying to add more advanced services, which Gartner says they need to do or face commoditization over the next few years. ABI Research says cell phone navigation services are actually in a good spot given the connected networks can easily add important real-time driving information.

We recently decided to check out how well cell phone-based navigation systems really work. We tested out TeleNav’s cell phone GPS navigation application which costs $10 per month for unlimited trips when using certain Sprint phones (we used the Sanyo, Katana for Sprint PCS Vision). We found it easy, mostly reliable and pretty invaluable when it came to finding meeting locations throughout the Bay Area.

The only problems it had were when driving on downtown streets where the signal seemed to get confused by tall buildings. The warning disclaimer was also a little disconcerting: “Do not maneuver this application while driving.” We guess that means keep it in its dashboard mounted holster and try to input the address before you start driving. But since its a portable cell phone we really wanted to pick it up and use it at all times. Though overall the service worked so well for $10 per month, we would definitely consider signing up.