The death of dedicated satnav cometh as TomTom posts poor Q3 sales?

TomTom has recently posted some rather unhealthy Q3 sales as the company sees further drop in demand for dedicated GPS units.

The Dutch company, who has been at the forefront of the satnav industry for many years aims to cut 50 million euros in costs, which will hopefully help it turn a decent profit in the coming months. The savings will also mean job cuts ofr many of its staff.

Despite a 50 per cent rise in its Q3  profit, due in large degree to depreciation of the euro against the dollar, it seems TomTom struggled - with sales falling 10 per cent in the same period to 336 million euros.

"We have started a restructuring program which will focus our organization on the areas where we see the greatest potential for growth, of which Automotive and Content & Services are clear examples," said Chief Executive Harold Goddijn in a statement.

The key part of this quote is "content and services", something which TomTom, in seeing the way the tide is turning, seems to be taking steps to address. Goddijn clearly doesn't see the future being its hardware.

This is due to the growing trend for Mobile phones to be used for car navigation, a comparatively cheap app download is all it takes to transform a smartphone into a suitable tool for the purpose - also bringing far more flexibility to boot. Couple this with car manufacturers looking at developing "connected cars", such as Ford SYNC which enables your smartphone GPS through the car's speakers and the future of the dedicated satnav isn't looking rosey.

Still, let's hope TomTom pulls something out of the bag as its products and services have always been top-notch.

Can you see dedicated satnavs lasting the course? If not, how long have they got?  Comments in the box below please...



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