The number of mobile subscribers using a turn-by-turn navigation service or application on their handset grew 57 per cent from H1 2009 to H1 2010 to reach 44m users worldwide, according to new research from the analyst, Berg Insight. The subscriber base is forecast to grow at a compound annual growth rate (CAGR) of 33.1 per cent to reach 195m users worldwide in 2015.

Broad availability of GPS handsets and attractive pricing are key factors for widespread adoption of mobile navigation services, says Berg. In the US, where GPS handset penetration is above 70 per cent, navigation services for mobile phones has already reached about 8 per cent of the total mobile subscriber base.

A large proportion of these users get navigation as part of a service bundle together with a voice and data plan from their mobile operator. As a response to the launch of free navigation apps for smartphones by Nokia and Google, more and more operators worldwide are now introducing bundled navigation services to offset the cost for end users. Navigation service providers and mobile operators are also trying to monetise services by introducing various feature and content up-sells that allow users to customise navigation apps to suit their personal needs.

“Mobile operators and service providers are now accelerating their efforts to create differentiated navigation experiences with unique local content to compete against free services”, says Berg Insight senior analyst, André Malm. He adds that integration of navigation services with other applications to stimulate usage will become increasingly important for mobile operators that seek additional revenues from location-based advertising. Since relatively few subscribers need turn-by-turn guidance on a daily basis, complementary features such as social networking, restaurant and event guides improve stickiness.