Wednesday, October 28, 2009

Google Enters Yet Another Market

Google announced today that they are going to offer a FREE navigation system for mobile phones. This was clearly the next step for Google considering they already have all the information for the navigation system. This new feature is part of the latest version of Google Maps for Mobile. Today Verizon and Motorola unveiled the Droid (Motorola Droid pictured), which is a smartphone powered by Android 2.0 the system by which Google Maps for Mobile will be operated.

Verizon and Motorola are undoubtedly partnering with Google as part of the ongoing battle with the iPhone. Verizon had previously offered a mobile navigation system, but it was $10 a month. I am interested to see how the iPhone will fight back. Will iPhone also partner with Google, the k-strategist in this situation, or will they remain with MapQuest whose directions are inferior to Google Maps (in my opinion)? There are a lot of features that Google Maps for Mobile will offer that is not being offered currently by the iPhone. These features include live updates on traffic conditions and voice command recognition.

There is also another huge point to be made with Google’s product innovation. Will it be disruptive to the TomToms of this world? There is no doubt in mind that it will be disruptive, but how soon will this disruption occur? It is going to take time for the new Droids to get in people’s hands and therefore I do not believe that the disruption will happen immediately. Because of a recent introduction by TomTom of an iPhone app that costs $100 I believe that the company understood that a disruption was underway. Though the $100 is better than the cost of their $300 device it is nothing compared to free. How is the GPS industry going to combat the “low-end” disruptive innovations being introduced (Anthony and Christensen)? Do you think that it is feasible for the GPS industry to create a competitor to the free mobile navigation devices popping up? I think it is impossible for the GPS makers to offer a free mobile application because they have to make money. What do you think they should do next? Is there anything they can do?


  1. As a Verizon GPS subscriber myself, I will welcome this change. Their current GPS system is not user friendly (I should note that I only tried it one time and was frustrated by it) and I typically use the internet on my phone to get to Google Maps.
    I believe that this red-ocean strategy that the cellphone companies are pursuing to enter the GPS company's once blue-oceans will probably do away with companies like TomTom. Companies like Google with more resources and diversified products will be less hesitant to move towards providing less expensive GPS software because they have other value creation propositions, where as a GPS company is more limited. For GPS companies to survive long-term they will have to offer something that more general companies are not able to. However, I'm not sure what this would look like. Perhaps it could be linked to Kelsey's innovations where there is a type of premium service offered for TomTom customers?

  2. I currently have a Palm Centro and Google Maps has been an application on the phone since I've had it (about 2ish years). My touchscreen is currently broken on my phone, but as far as I'm aware, I get can directions as well as traffic conditions. I think the one innovative feature to come out of this is the voice command recognition. It seems as though Google is updating what they had previously offered to other providers.

  3. Two things came to my mind while I was reading this. The first was Kelsey's innovation project and if she could somehow leverage this when developing her business strategy. I think Katie made a good point when she said that premium services like Kelsey's innovation could be offered by GPS companies like Garmin and TomTom so that they can sustain their value over what Google is offering for free.

    Secondly, I think the market for GPS devices will not disappear anytime in the near future...even if some market segments may prefer getting their maps and directions over the phone, there will always people like me who like the ease of having a big GPS screen right in front of them while they drive, making it easier (and safer!) to view maps, and update addresses, etc as you drive. I personally wouldn't like trying to navigate through a tiny phone screen as I'm driving - if texting while driving is illegal now because it causes traffic accidents, wouldn't this pose the same concerns? Depends on how you use it, I guess. While I know GPS through mobiles has been around for a while and I do know a lot of people who subscribe to this service, I don't see it taking over the GPS device market anytime soon.