NuviFone: NuviNirvana Or NuviNightmare for Garmin?

October 30, 2008 · Posted in Commentary, Companies

Nuvifone scenario
by ViaMedia

Garmin had their 3Q quarterly earnings announcement yesterday, and amid all the revenue, earning and profit hullabaloo, they also announced “Game On” for the launch of the Nuvifone in the first half of 2009.

With GPS introduced as a standard feature in the new 3G iPhone in June and the more recent announcement of the availability of the Android G1 phone from T Mobile, there was the feeling among some that maybe Garmin would have a change of heart and take the opportunity to holler “Car!”, grab their ball and make a run for the house and never come back out. But no, the game is still on.

While I was, and still am, quite excited about the prospects of Garmin bringing their NuviFone to market, six months ago I would have been one of the first in line, but now I have since become a happy iPhone owner and now I am not so sure I’ll be making a change anytime soon. And when the subject comes up about Garmin entering into the super competitive smartphone market, what I mostly hear from industry type folks is “what the hell are they thinking?”

So what does Garmin have going for it to think that it can make a good business out of developing and launching a location centric smartphone? Some thoughts:

Destination: NuviNirvana
My guess is that Dr. Min Kao’s thinking went something like this:

-Despite what some people think, creating a great turn by turn navigation experience is as close as it gets to rocket science in the consumer electronics space, and we think we do a pretty good job at manipulating complex technologically to create awesome consumer experiences, so how hard can it be to go do a phone?

- Mobile location awareness is really the next big thing that will change everything about the mobile phone experience, people just haven’t been able to truly experience it yet because those other losers bury GPS functions deep in the deck next to the calculator and the latest release of Bejeweled. Make it front and center and people will eat this stuff up!

-The market was headed toward connected PNDs anyway, and there is no way in hell that we we’re going the MVNO route… no one will pay a monthly fee on their PND and I just don’t want to deal with that mess. Wait, I know, let’s just add in the original killer app of voice calls to our PND and call it a phone instead, people have no problem paying monthly fees for phones.

-We’ve already invested so much in developing manufacturing and distribution capabilities and those guys are going to get bored soon if all we’re selling is a few million navigation devices, these guys need more stuff to manufacture and distribute and world wide demand for phones is something like 2.3 bazillion…. If we can just get 1% of that market we will all be rich!

Destination: NuviNightmare

Meanwhile in the other corner, the “have you heard of a little company called Motorola” crowd, where the argument goes something like this:

-Are you insane! Even the people who have been in the phone hardware business for years and years, no longer want to be in the hardware business anymore. It’s turning into a low margin, commodity business. Customers are fickle, and want to pay all of $20 for a phone that does everything but wash the car for you.

-Android and the iPhone are rapidly changing the game. Customers no longer expect to be able to do 4-5 things on their phone like make a phone call, check email, send a text, etc. They now expect to be able to do 500 things including… check in on Facebook, watch the latest YouTube video, browse their web photo collection, read the newspaper, trade stocks, listen to music, all while playing real-time head to head mobile AirHockey against their roommate.

-Yeah, you may know navigation, but this ain’t navigation and you’re a couple of decades behind in learning what folks want from their phones.

-Want to do business in the U.S? Well, remember those millions of little guys who you once considered your customers, well no more, now you have one big customer, meet Mr. Carrier.

Well so far, NuviNirvana seems to be winning the battle at least among the folks that matter, Min and crew. But I am frankly not sure what I think about the whole thing. But I do know that there are some things that could really make this interesting:

-An Android Nuvifone. This would solve the problem of not being able to have those 500 different apps that could put the NuviFone at a disadvantage. Not sure how feasible this would be with the way that Garmin (not unlike Apple) really likes to keep a stranglehold grip on the user experience. But undoubtedly an interesting partnership.

-Garmin isn’t thinking Navigation, but instead a portfolio of services built on top of location awareness. In other words, they have downloaded, played with and called the developer of every application in the iTunes App store that makes use of location data. Google search is certainly a start, but hopefully is just one of dozens of similar partnerships.

-Garmin moves away from its roots and has some sort of back up positioning besides GPS for indoor and other GPS compromised environments.

-Garmin is aggressive in implementing features that not only allow the owner of the phone to know their own whereabouts and what is around them but to broadcast out their whereabouts to others with a robust set of security controls of course.

-Some technological innovation that can allow the GPS or other location identifying technology to remain always on in the background without killing the battery. There is a big difference between this passive vs active location awareness and the types of services that can be offered.

Stay tuned… maybe Garmin can pick and up run with what Apple started.

Bookmark It