Auto Electronics

ABI says location ecosystem seeks sustainable growth, viable business models

Despite the relative success of Personal Navigation Devices and industrial GPS applications, the location ecosystem continues to encounter challenges on its way to continued profitable growth, according to Dominique Bonte, research director for telematics and navigation at ABI Research. Penetration levels for consumer telematics and LBS services remain low while more established product categories suffer from price erosion and dwindling margins.

“The location industry remains largely undecided on preferred device form factors, acceptable business models for connected services, addressable user segments, positioning technologies and, most importantly, which services and content offer most value to the end user,” Bonte said.
“The industry is still characterized by too much experimentation, with navigation vendors moving from PNDs to handset-based navigation and vice versa, diluting their market and brand positions in the process.”

Bonte said each player in the ecosystem should capitalize on its strengths and focus on increasing the quality, user experience, brand identity, market share and global coverage of its solution while looking for partners whenever possible in order to decrease costs. He also advised the location industry to strive for more standardization and cooperation, and to open up their platforms to the entire mobile industry, thus reducing fragmentation and isolation for the benefit of the complete ecosystem.

ABI Research’s recent study, “Location Based Services (LBS) Ecosystem and Value Chains,” provides an overview of the services, trends, drivers, barriers, ecosystems, value chains, and forecasts associated with the LBS, navigation, telematics and GPS-handset markets. It’s part of the firm’s Location Aware Services Research Service.

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