Long time no blog. I know, I’ve been a bad boy. Last month I attended Mobile World Congress in Barcelona, the largest gathering of mobile execs (and wanna-bes) outside of next week’s CTIA. I have lots of memories of the week, from the 2-hour registration queue to the stunning Gaudi architecture to $600/night for a second-rate hotel (damn you, Federal Reserve for that exchange rate). But the most poignant moment of the event was standing in the middle of Hall 8 between the Nokia and Motorola booths. Nokia was busting at the seams with people, having just launched 4 new GPS-enabled devices: the N96, N78, 6210 Navigator and 6220 Classic. Not to mention Nokia Maps 2.0. I glanced to my left and the Motorola booth was nearly empty, a sad sight for me as an ex-Motorolan. I wandered over there and asked one of the Moto employees if they had any GPS phones, “you know, like the ones over at the Nokia booth that you can geo-tag photos with.” She made no effort to put any spin on the fact they they had absolutely no devices in that category. So I’m not entirely shocked that the company just spun out the handset division, prepping for a possible sale. But some of the recent dirty laundry is still eye-opening (Motorola insider tells all about the fall of a technology icon). As a friend recently remarked, Motorola and Ed Zander will likely soon be immortalized in an HBS case study…
Garmin made a splash last night and announced their new mobile phone. The nüvifone will feature a 3.5-inch touchscreen, internet browser, HSDPA support, Bluetooth, WiFi, camera, media player, and preloaded maps of North America and / or Europe. In addition, it houses “millions” of POIs, doles out turn-by-turn, and voice-prompted directions. Garmin has partnered with Google to integrate access to Local Search and Panoramio. But here’s the problem - the devices run Garmin’s proprietary PND OS.
As expected, there has been considerable confusion and ignorance coming from Street analysts and the media. No, this is not Garmin’s first foray into the mobile phone market (Garmin NavTalk) nor is it “the first time navigation and LBS have been put at the core of a wireless device” as an Oppenheimer note trumpeted (Nokia 6110 Navigator).
This strategy is hardly unexpected - GRMN has taken a ugly beating over the last three months because of the perceived threat of shrinking PND margins and increased competition from mobile phone manufacturers. Garmin knows they need to enter the market in a big way. But without the scale and distribution that device makers like Nokia and Samsung enjoy, does Garmin stand a chance? I think it’s likely that Apple, Nokia and HTC will eat Garmin for lunch. Keep your eyes peeled - nüvifone is expected in Q3.
With this morning’s housing numbers showing an 11% YoY decline in median home prices and a 9.6 month supply at the current sales rate, this deal raises some eyebrows. Mobile real estate listing company Smarter Agent recently closed a $6.2 million “oversubscribed” first round of funding. The round was led by private equity magnate Ira Lubert, who co-founded Lubert-Adler’s multi-billion dollar real estate fund, LLR Partners, Quaker Bio Ventures and Versa Capital. The funding will support the roll-out of Smarter Agent’s GPS real estate searches including a Homes for Sale application due to launch at the beginning of Spring. Smarter Agent has a service which lets people find houses for rent or sale near where they are when they make the enquiry—it launched on Sprint a year or so ago and gains subscription revenue though a monthly fee. It claims that over 25,000 people used the service over the summer and 35 percent placed calls to the agent/property owner.
That’s a nice-sized investment for the company and should help to get things moving. Right now they’re stagnating with just one carrier, Sprint Nextel (which happens to be bleeding to death right now). Integrating the apps with an ad model should work well. And with one third of users placing calls to owners/brokers there could be a really nice commission model there as well. It would make sense to push the app for free, although the carriers would never let that fly. I’ll bet that Apartments for Rent application will get some good traction with the foreclosure tidal wave upon us…
Finally back and recovering from the 2008 edition of the Consumer Electronics Show in Las Vegas. It’s always jarring to go straight from a nice, long holiday vacation to the CES three-ring circus. My impression of the show in one word: disappointed. Maybe the most exciting thing was that Garmin had a GPS repeater set up at their booth to get a live feed for demo devices. Or perhaps that 150″ Panasonic plasma. But isn’t this the consumer electronics show? Come on guys, that’s an ego trip, not a consumer product. And Garmin shares have fallen nearly 25% since the show began, so obviously the Street didn’t like the repeaters as much as I did. Not much new for phones either, although I liked the GPS-enabled Sony Ericsson W760. But hardly big news. Truthfully, connected devices were the theme this year. Garmin announced MSN Direct-powered PNDs like the Nuvi 780 and 880. Magellan had the Maestro Elite 5340 with Google Local Search via two-way connectivity over GPRS, but that will set you back $1300 and $40/mo. And don’t forget Dash Navigation. Last year’s big news of the show was the iPhone, but that wasn’t even at CES. So here’s some food for thought - is the CES hype too big for its own good?
Uniden is a relative newcomer to the GPS game, but it has years of experience in high-end radar detectors. So it’s no surprise that, come CES, it will be the first company to introduce a MapTrax GPS navigator with radar detection built in. This should be a profitable niche for Uniden, even as prices and margins are plummeting on mainstream PNDs. Of course, detectors are illegal in a few regions. Maybe Uniden will lock down the detector functionality in banned areas like Virginia by using GPS location.
This year Google has teamed up with the real Santa-tracking pros — the North American Aerospace Defense Command (NORAD). You can currently count down to the big sleigh ride on the NORAD Tracks Santa website, and starting at 1 am PST on December 24th, you’ll be able to download a special KML file that lets you follow his trip in real time through Google Earth. Check out the Official Google Blog to read the humorous story of how NORAD (and now Google) became involved in the Santa-tracking tradition that began more than 50 years ago.
And while you’re in the Santa mood, check out Wired Magazine’s side-splitting analysis of Santa’s supply chain and the $27.5 billion annual cost for Operation Christmas (warning: PDF link)
O’Neill Europe is showing off their new NavJacket, a Gore-Tex jacket with an integrated navigation tool. The NavJacket is the product of a partnership between O’Neill’s Wearable Electronics Department and MyGuide. According to some O’Neill propaganda, the jacket allows you to navigate through the mountains with the help of the integrated display on the sleeve and the audio instructions in the hood (is it that annoying British female voice?). “Simply enter your desired location and let the NavJacket guide you effortlessly down the slopes.” I’m fine with getting routing for something static like streets, but for an environment as dynamic as a ski slope? Also displays your current speed, weather forecasts, and details about your route, such as distance and time. Finally, the jacket has a friend finder function, which allows you to track down buddies on the slopes. The NavJacket will be available as part of the O’Neill Fall/Winter 2008/09 collection.
Google’s My Location has really milked the media machine this week, certainly an accomplishment for incorporating a decade-old technology into Google Maps. Sure, there’s bound to be some confusion and ignorance from writers and readers alike, but I was floored by some of the reactions. How ’bout this headline from Om Malik: With Google’s My Location, Who Needs A GPS? Gee, maybe anyone who wants to get accurate routing (navigation)? Cell-ID positioning works fine for local search (read: finding the nearest Starbucks) in densely populated areas where accuracy can be as good as 500m, but in suburbs and rural areas where cell towers are spread out, it could be closer to kilometers. Countless wireless carriers and application developers have attempted to leverage this technology with little success due to its low accuracy.
I subscribe to Minyanville’s Buzz & Banter ticker and my jaw dropped when I read a post this morning from options analyst Jon Najarian titled Google Developing Mobile Competitor to GPS: “What isn’t GOOG going to own going forward? Reports on sites like VNUnet.com say the search giant is developing a competing mobile navigation system to tap the multi-billion dollar GPS market.” Really? Apparently even the Street analysts are blinded by the Google Machine into believing that everything they announce is homegrown and/or new. Yikes.
Lest you think I’m completely sour grapes on this, using cell-ID will be a useful supplement to GPS since it works indoors, uses less battery power, and has a faster “fix” time. Same will happen with WiFi positioning. Nice feature, but please put down the Kool-Aid, everyone.
Something happened in the mobile turn-by-turn space a few weeks ago that didn’t get a lot of play in the news. But it was a shift that I saw as game-changing. Not a new feature or distribution channel, but a new price: sub $5.
MapQuest, in partnership with Telmap, is now selling MapQuest Navigator 5.0 to consumers through a new direct-to-consumer storefront on MapQuest.com. Customers who subscribe before December 31, 2007 can download the application directly to their handset and purchase the service for the “promotional price” of $4.99 per month for the life of the subscription. This new version is available for several Blackberry devices for Sprint, T-Mobile and AT&T customers.
At this price and with the included set of features, Mapquest Navigator might capture a new segment of customers that is not willing to pay the industry-standard $10 a month. Indeed, a poll by Harris, conducted in May and June 2007, shows that with a price set at $11.99 per month only 4 % are extremely likely/very likely to subscribe; at $8.99 they are 6% and at $5.99 it grows to 19%. (read more here). Just one question: are BlackBerry owners that price sensitive? I’m inclined to think that they’re chasing the wrong segment with price cuts. The Telmap guys are sticking with the “promotional price” story, but we all know that it’s nearly impossible to raise the price on consumers (just ask GM about their 2005 discounts). At $5/month, there’s not a lot of pie to go around: application developer (Telmap), brand (MapQuest) and content provider (Navteq). Gotta sell a lot of apps at that margin…
Don’t you love the drama? Less than a month after Tom Tom finalized a $2.5B bid for Tele Atlas, Garmin trumps with a $3.3B offer. This puts the Tele Atlas board in a very uncomfortable position. The strategic fit with Tom Tom is much stronger - both companies are based in the Netherlands and most of Tom Tom’s devices use TA data. But the board has a fiduciary responsibility to TA shareholders and would have no choice but to accept the new offer, if the bid is indeed apples to apples. On the other side of the table, Garmin almost exclusively uses Navteq data. I’m not sure how deeply integrated the data is, but it won’t be a trivial process to change horses. And here’s the kicker - Garmin won’t make the offer official until December 4th, the same say the Tom Tom bid expires.
How’s this for a possible soap opera: Tom Tom loses Tele Atlas and switches to Navteq for licensing data. Garmin gets TA, overpays and has a nice goodwill write-off in a few years. Nokia ends up the winner, despite a mammoth $8.1B price for Navteq, since mobile LBS is the future. Meanwhile, Google launches an open source mapping program that makes all of this consolidation seem laughable in hindsight. It could happen…
With this morning’s housing numbers showing an 11% YoY decline in median home prices and a 9.6 month supply at the current sales rate, this deal raises some eyebrows. Mobile real estate listing company 
Finally back and recovering from the 2008 edition of the Consumer Electronics Show in Las Vegas. It’s always jarring to go straight from a nice, long holiday vacation to the CES three-ring circus. My impression of the show in one word: disappointed. Maybe the most exciting thing was that Garmin had a GPS repeater set up at their booth to get a live feed for demo devices. Or perhaps that 
