Google Intro's Turn-By-Turn: Shakes up Navi

Amy Gilroy -- TWICE, 10/28/2009

Mountain View, Calif. - Google rocked the navigation industry Wednesday, on news that its new Google Maps for Mobile service delivers free turn-by-turn navigation on a smartphone-a feature that often cost $99 or $10/month until now.

The new Google turn-by-turn service will be available on Android 2.0 phones and will be released first in the Motorola Droid from Verizon on Nov. 6.

The application uses voice commands for destinations and was built from the ground up to interface with the Internet. In Google's video demo, users ask to navigate to a museum with the King Tut exhibit, and because Google Maps for Mobile is connected to the Internet, the phone "knows" there's a King Tut exhibit at a certain local museum and can direct the user.

The service allows photo-real street views, and shows "a picture of your destination as you approach the end of your route, so you'll know exactly what to look for," said Google.

Users can zoom out to see a bird's-eye satellite view of their route and may also receive traffic updates along their route path every few minutes. Maps are updated without fees and phones using the software continue to navigate even if a signal is lost. The cost of the off-board navigation is included in the Android-phone's data plan.

When asked how Google Maps for Mobile will impact TomTom, who supplies a $99 iPhone GPS app and who also owns map maker Tele Atlas, TomTom chief executive Harold Goddijn, said on a financial call Wednesday, "We are continuing to build and maintain maps that are very high quality, that meet the requirements of navigation and the automotive industry and we continue to be successful in gaining access to those markets. We can't comment on what Google is trying to do."

But Google decided to stop using Tele Atlas map data for the U.S. earlier this month, confirmed a spokeswoman although Google continues to use Tele Atlas data for "dozens of markets" outside the U.S. and these overseas contracts are in effect through July 2013.

Another iPhone GPS app provider, Navigon, said it was expecting Google's strategy and noted that Google Maps for mobile is not yet available for the iPhone.

However, analyst iSuppli called Google Maps for Mobile a disruptive product and said, "This shook everybody up, I think," said Egil Juliussen, a principal analyst for automotive. The service will particularly impact carriers that charge $10 a month for navigation on a mobile phone or smartphone, he said, noting there's a lag before people buy a new phone but "competing with free is very tough."

"The question is will it only be on Android 2.0 and what about the iPhone? Will anybody who has Google Maps be able to do the same at some point? I'm wondering if Apple would even do that because they would wipe out all the other navigation providers like TomTom who have apps [on Apple's App Store]," wondered Juliussen.

A report in the New York Times said Google executives hope that the new service will eventually be available on the iPhone and other devices, but they said it is up to the device makers to include the application.

The news may have contributed to skittishness in navigation stocks with shares of TomTom (who also released lower profits and sales Wednesday) falling 20 percent and Garmin shares down 16 percent.