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Handset makers find a route map to the future

“No more struggling with oversized paper maps.” That was the promise from Olli-Pekka Kallasvuo, Nokia’s chief executive, at the Mobile World Congress in Barcelona this week. He was unveiling a mobile phone service – and handset – specifically designed to guide pedestrians.

Maps and location-based services such as these, long seen as a natural application for mobiles, have been a key theme at this year’s congress.

Yahoo, too, put maps in focus with the launch of its OneConnect product, with another feature promising to show how far away friends are, and even plot their positioning on a map.

Google is also gaining traction for its Google Maps on mobile service, having secured partnerships with Vodafone, T-Mobile and the Apple iPhone.

Ericsson launched tools to help operators run location-based services on their networks, and Telmap, a company that provides whitelabel mapping services to mobile operators such as Vodafone, has just won a large deal with Orange Group.

The flurry of announcements shows the technology is maturing fast as global positioning system features are increasingly being embedded into handsets. Nokia, for example, is planning to include it in all its high-end, N-series smartphones. It expects to ship 35m GPS-enabled devices this year.

In addition, companies are starting to develop ways to determine location in places where GPS does not work well – indoors, in tunnels, and in cities where the signal bounces off buildings and becomes distorted. Chip companies such as Broadcom and CSR are developing systems to supplement GPS by triangulating the distance from mobile base stations to pinpoint location more accurately.

Analysts at Gartner expect location to become a mainstream mobile application within two to five years. They see the market growing from 16m users in 2007, to 43.2m in 2008 and 300m by 2011.

Revenues from location services are similarly ex-pected to grow from $485.1m in 2007 to $8bn in 2011.

A series of acquisitions last year made it clear that companies are betting on mapping becoming big. Nokia bought Navteq, a provider of digital maps data, for $8.1bn in October while TomTom, maker of car navigation systems, bought Navteq’s rival Tele Atlas for $4.2bn. Microsoft, meanwhile beefed up its existing mapping operations by buying UK-based Multimap for an undisclosed sum.

The spread of GPS from the car to the mobile handset spells potential cannibalisation for makers of stand-alone navigation devices such as TomTom and Garmin.

It is not surprising, then, that Garmin is fighting back with plans to launch its own mobile device – the nüvi-fone – this autumn.

The companies will make money from the services by selling subsciptions to navigation services. Nokia charges about a basic €25 ($36.6) for a year.

But advertising will also be important. Ads linked to a user’s precise location could bring impressive response rates – a local restaurant, for example, could target people walking nearby.

But the shift must be gradual, says Ronen Soffer, chief technology officer at Telmap, to avoid annoying customers who may be concerned over privacy issues.

“It is important to have this on the radar screen but the switch to advertising must be very gradual. Location-based advertising has to be very targeted, polite and effective to be accepted by users,” says Mr Soffer. “2008 may not be the year that we suddenly all switch to the advertising model.”

Источник: Financial Times

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