GPS makers such as Garmin and TomTom must develop new services to deal with the number of mobile phones and other devices that offer features similar to standalone GPS products.
Analysts believe GPS makers need to transform simple devices into advanced, more robust products -- and a price shift must also take place -- as manufacturers attempt to convince consumers why they need GPS products.
Manufacturers have already adapted to a certain extent by incorporating wireless capabilities directly into their products.
"You have to redefine the category somewhat, like what Apple did with the iPod Touch," said Ross Rubin, NPD Group analyst, in a statement to the Associated Press. "That turned it from something that was just a media player into something that accessed the Web."
In the future, expect GPS manufacturers to continue integrating new features into their products as they work with software developers. GPS maker Navteq is working with Microsoft so Navteq products have enhanced 3D maps for drivers to view, with similar partnerships being introduced.
However, software makers also are working with mobile phone manufacturers to provide new features for mobile users. For example, Google has introduced a turn-by-turn direction service that is available for free, which can be used on the the Motorola Droid phone on Verizon Wireless, and other handsets.
Verizon Wireless, AT&T and Sprint-Nextel also have GPS services available for $9.99 per month -- free with unlimited data subscriptions -- that put even more pressure on GPS makers.
Garmin and other GPS makers have started to release customized products for athletes and other select markets, which gives them the ability to market products untapped by mobile phones.
