According to a new research report from the analyst firm Berg Insight, the subscriber base is forecast to grow at a compound annual growth rate (CAGR) of 33.1%, to reach 195 million users worldwide in 2015.
Broad availability of GPS handsets and attractive pricing are key factors for widespread adoption of mobile navigation services. In the US, where GPS handset penetration is above 70%, navigation services for mobile phones has already reached about 8% of the total mobile subscriber base. A large share of these users gets navigation as part of a service bundle together with a voice and data plan from their mobile operator.
As a response to the launch of free navigation applications for smartphones by Nokia and Google, more and more operators worldwide are now introducing bundled navigation services to offset the cost for end users. Navigation service providers and mobile operators are also trying to monetise services by introducing various feature and content up-sells that allow users to customise navigation applications to suit their personal needs.
“Mobile operators and service providers are now accelerating their efforts to create differentiated navigation experiences with unique local content to compete against free services,” said André Malm, senior analyst, Berg Insight.
He added that integration of navigation services with other applications to stimulate usage will become increasingly important for mobile operators that seek additional revenues from location-based advertising. Since relatively few subscribers need turn by turn guidance on a daily basis, complementary features such as social networking, restaurant and event guides improve stickiness.