Price erosion has resulted in 30% growth in GPS uptake

By Patrick Avenell

SYDNEY, NSW: A drastic reduction in the sales price of GPS devices has been good for the industry and for consumers, according to Navman general manager Australasia, Marcus Fry.

In an interview with Current.com.au, Fry said that whilst the satellite navigation market has moved away from being a value player in the CE market, this has resulted in benefits for everybody.

“The recommended retail price has come down considerably over the last two or three years,”
 said Fry. “Three years ago, these product were selling for $1,800 and now they’re selling for $300 and upwards, even below that in some cases, so I think that’s good for everybody.”

Rather than bemoan this erosion in unit price, as is common among suppliers and retailers alike, Fry sees the positives, most noticeably, a substantial uptake in consumption and use.

“Realistically, we’re selling an awful lot more units now then we were before, certainly at those price points, but it’s opened up to everybody now. It’s not just to the people that can afford the big flash cars or anything else, it’s opened up to middle Australia.”

Current penetration rates in Australia are estimated at around 12 per cent. Fry believes this figure can double over the next few years, with more and more GPS units selling every year. If there is one caveat to this prediction, it is the unknown factor of the economy.

“Once we get to 25 per cent penetration rate, the wheels will keep on turning, and the market is still growing by far.

“This year, we’ll see a growth, in unit terms, still around 30 per cent year on year, and that’s only been compressed because of the economic climate, and we’re yet to see really how that’s going to affect the next 6 months.

“It’s still growing at 30 per cent year on year, which is a big number by any comparison. This year, there’s probably about 1.3 million units sold in Australia, next year, depending on how the economy goes, we can see it growing to 1.8 [million].”

If Fry is right about Australia’s uptake of GPS devices, the local penetration rate could surpass his homeland, the United Kingdom, which currently has one of the highest rates in the world.