Apple could create headaches for Garmin and TomTom

Posted Jul 1st 2008 4:17PM by Brian White
Filed under: Products and Services, Apple Inc (AAPL), Garmin Ltd (GRMN)

You would think that companies making standalone GPS devices would be making bank right now. The devices that never let you get lost when driving are important to many travelers, especially when you don't want to fumble with maps, let alone get lost and waste a bunch of expensive gas getting back on track. Garmin Ltd. (NASDAQ: GRMN), one of the leading GPS makers, though, has seen tough times recently. Its shares have declined 56% recently. Why I'm not sure. I do know that it has nothing to do with Apple, Inc. (NASDAQ: AAPL)'s iPhone that's about to be released in a few weeks.

Apple's new 3G iPhone will have embedded GPS, which will make the gadget all the more useful. Regardless, though, will consumers be using their iPhones as replacements for full GPS devices in all those vehicles? Unless there is a decent vehicle mount kit available, it's hard to believe so. The iPhone does have the best chance at displacing more units from Garmin and other GPS makers like TomTom in the car navigation arena, but the entire GPS experience is what some folks probably forget about.

If you've ever used a GPS navigation program installed on a normal cellphone or smartphone, does it works seamlessly like a standalone product? Can you take and make calls while the GPS continues working in the background, giving you all those voice directions? What makes standalone GPS devices so valuable is that they work even when we're multitasking with phone calls. That's the kicker: the first time you miss a direction by voice because you're busy chatting on the phone, a GPS solution on top of a cellphone -- at least for driving purposes -- would become useless to the average consumer. I doubt Apple's upcoming solution will be this drab, but I continue to see a bright future for standalone GPS device manufacturers (although profits will continue to dwindle). Apple, as always, is not the only game in town. It will still be big for non-driving GPS uses, though.

Tags: AAPL, Apple, Garmin TomTom, GarminTomtom, GPS, GPS iPhone, GpsIphone, Inc., iPhone 3G, Iphone3g

Print this

Reader Comments (Page 1 of 1)

7-01-2008 @ 4:33PM

Mateo said...

Totally disagree with this. The GPS hardware/software combos in newer devices - not to mention the upcoming iPhone 3G - are much more advanced than what was available a year or two ago. For example, these modern systems can "chime in" while you're on a cell call. And honestly, if the only other thing stopping widespread use/adoption/replacement of GPS-only car systems is the ostensible dearth of "decent vehicle mount kits," then Garmin et. al. do have a lot to worry about.

By the way, the statement "I continue to see a bright future for standalone GPS device manufacturers (although profits will continue to dwindle)" makes no sense to me. Dwindling profits ≠ bright future.

8-05-2008 @ 12:17PM

Constable Odo said...

I'm not sure it will be much fun driving while trying to follow a blue dot on the iPhone screen. Unless the iPhone gets an application for turn-by-turn voice navigation, I don't think the iPhone is much of a challenger to Garmin or TomTom.

7-01-2008 @ 6:04PM

Yago Bal said...

If you're driving, what are you doing chatting on the phone? ;)

7-02-2008 @ 12:13PM

Zoltar said...

Totally wrong, showing off your ignorance. Why bother writing about things you're clueless on?

TomTom has software that runs on Windows Mobile PDA/SmartPhones and it doesn't mess up when you're taking a call, it just resumes the screen to the normal GPS function letting the sound from the call pass through. So you're driving paying attention to the road and glimpsing at the Smartphone screen for directions when needed.

Of course, you don't take calls while driving by grabbing the phone, do you?! In my country that is strictly forbidden by law but no matter where you'd be doing that is just plain stupid and dangerous.

Anyway, if the Smartphone is operating as a GPS it must be in its own whatchumacallit car holder close to the wheel so that you don't divert your eyes too much and you've got to have the Smartphone connected to your stereo or a hands-free speaker via Bluetooth.

In sum, if TomTom accomplishes this not messing up the calls in a Smartphone with the lousy Windows Mobile OS, why wouldn't Apple do that in a even more sophisticated fashion with the intelligentphone / handheld computer that the iPhone is?!

7-02-2008 @ 7:37AM

solomalee said...

How does this headline:

"Apple could create headaches for Garmin and TomTom"

Relate in any way to the apparent conclusion:

"I doubt Apple's upcoming solution will be this drab, but I continue to see a bright future for standalone GPS device manufacturers (although profits will continue to dwindle). Apple, as always, is not the only game in town. It will still be big for non-driving GPS uses, though"

Absolute FUD

7-02-2008 @ 9:24AM

Tom Roehl said...

Don't forget about the iPod Touch. If Apple updates it to have true GPS then it could be a serious threat to the dedicated GPS devices.

People have already rigged up all kinds of ways to interface their iPods to their cars. If the iPod also offered GPS navigation then it could truly be a force to be reckoned with!