World news: Mobile navigation opens up €512m search-based ad market

World news: Mobile navigation opens up €512m search-based ad market

According to new research by Berg Insight, the number of mobile subscribers accessing maps and downloading routes in Europe and the US is expected to increase from 4 million users in 2007 to around 43 million in 2012.

Revenue from subscriptions and advertisement is expected to grow from €96 million this year to €512 million by 2012, a CAGR of 39.8%.

The growing adoption will be driven mainly by the introduction of GPS-technology in smartphone handsets and bundling of navigation and map content with mobile devices as well as service plans.

In the US, GPS is already a standard feature in all CDMA-handsets, with Sprint Nextel and Verizon Wireless attracting millions of subscribers to navigation services.

This year’s successful launch of the GPS-enabled Nokia N95 has opened up the market for handset based navigation in Europe.

Meanwhile, Nokia is putting its full weight behind a handset-centric map and navigation platform, whereas Google and Yahoo! are extending their existing local search and map propositions with Mobile Web 2.0 applications.

André Malm, telecom analyst at Berg Insight says that record shipments of PNDs in Europe and the US have introduced the benefits of GPS for motorists. Now the major players in the mobile industry are in hot pursuit of delivering the same experience for pedestrians, commuters and travellers on the handset display.

Berg Insight expects that ad-funded services will account for an increasing share of the mobile navigation market. Navigation fits perfectly with local search applications that offer completely new opportunities for advertisers to target consumers in novel ways.

Malm urged the mobile industry players to embrace the ad-funded service model in order to stay competitive on the emerging market.

"Maps are already available free of charge from a host of sources on the Internet. Soon navigation will reach that stage too, pulling away the very foundation for premium rate mobile propositions," said Malm.


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