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MSN Direct To Cease Jan. 12

Microsoft’s MSN Direct’s real-time traffic service used in many portable navigation devices (PNDs) will go dark as of Jan. 1, 2012, said Microsoft.

In a notice to consumers, Microsoft said MSN Direct — the traffic, weather and information service used by Garmin, Pioneer and Alpine — will cease service due to competition from newer technology. MSN Direct operates over unused FM radio spectrum, and now competes with Wi-Fi, cellular and other new technologies that are increasing in popularity.

“Despite good initial MSN Direct adoption, these alternatives have significantly reduced demand for MSN Direct service. As such, Microsoft has made the decision to focus future U.S. and Canada investments on these existing network connections and discontinue the MSN Direct services business,” it told consumers.

Users can still sign up for a 12-month subscription or they may receive pro-rated rebates.

MSN Direct’s traffic and information service carries a fee of approximately $50 per year, but since its launch several years ago, free ad-sponsored traffic has become available and cellular data plans are growing cheaper.

Analyst Dominique Bonte of ABI Research stated in a blog, “What always seemed like a temporary solution — despite the support of PND market leader Garmin — has now effectively been earmarked for phase out.” He added, “A similar fate might be awaiting RDS-TMC, the other FM-based one-way connectivity platform which was and still is popular for receiving real-time traffic.” As smartphones and cellular-connected PNDs become popular, “there will be no room left for a bandwidth-constrained connectivity platform,” he said.

Clear Channel, which operates an RDS FM-based traffic service, said it has no plans to cancel the service and is already porting its service over to higher bandwidth platforms including HD Radio. Clear Channel said a supplier, Cydle, is selling a $329 PND with traffic updates over HD Radio that allow users to receive accident reports 10 times faster than over FM or satellite broadcasts.