One Billion GPS Chip Sets by 2011 - SiRFs UP?

In a report published today ABI Research forecasts one billion GPS chipsets will be shipped annually in 2013. According to ABI Research, in 2007, SiRF held a commanding 70% share of the GPS IC market. "It achieved this by getting in early and aggressively targeting the market for consumer devices: while professional GPS has been around for some time, it is a much smaller and slower-growing market segment", explains the report.

Industry analyst Jamie Moss comments, "Three factors will intersect to shape the future of the GPS IC market. The average price of the chipset will fall to $3.50 or below by the end of 2008, permitting a true mass market adoption. This past fall ASP is driven by manufacturers' goal of producing receivers that can be included in lower-margin devices such as mobile phones: handset-based GPS will be critical to strong market penetration. The benefits will filter down to more traditional GPS uses such as in-car navigation. Meanwhile, we're seeing growing numbers of acquisitions: large chip manufacturers buying up specialist fabless GPS IC vendors in order to include their technologies in solutions that combine GPS with varied wireless RF product offerings, especially Bluetooth."

ABI's interest in GPS fabricators suggests manufacturers of personal navigation devices are facing continued stiff competition and will likely seek to stand out in the market by adding speech technology, multimedia capabilities, 3D map content and other features to their products. ABI Research predicts worldwide sales of these convergence devices will surpass more than 100 million units by 2011. Examples of such acquisitions in 2007 include Global Locate, acquired by Broadcom (June); GloNav by NXP (December); and u-Nav by Atheros (December). Additionally SiRF acquired Centrality to integrate System on Chip (SoC) solutions in its product range and u-blox went public on the Swiss stock exchange.

"In terms of absolute performance," says Moss, "there's not a lot to choose between rival manufacturers. To win important contracts the chipset must be as inexpensive as possible and as easy as possible for device manufacturers to integrate with Bluetooth, Wi-Fi, FM radio and cellular solutions. As it was with Bluetooth, there is no great proactive consumer demand for GPS in mobile phones today, but once it's there, people will use it and expect it."

The dominance of Mobile phones that increasingly offer GPS as a standard feature has driven SiRF to play the commodity game as new entrants erode their legacy domination of the GPS chip supply. They took a significant hit in their stock due to this increase competition. But they have an answer that could shift the opportunity back their way in a few quarters.

In February Sirf announced a new GPS chip design, the SiRFprima platform. SiRFprima is a technical jump in that it combines an industry leading GPS/Galileo location engine, powerful application processor, rich audio and video recording and playback capabilities, high-resolution 3D graphics and a host of peripheral interfaces - all tuned to operate concurrently. Playing to the smartphone manufacturers, it supports both WinCE and Linux operating system environments which suggests SiRF intends to play with Google's Android handset.

The SiRFprima platform includes an ultra-high-speed, multifunction processor comprised of an advanced ARM11 core, a high-performance location engine that supports both GPS and Galileo satellite systems and an on-chip DSP. It also includes hardware-accelerated 3D graphics and multimedia encoding and decoding engines based on the gaming-grade PowerVR MBX 3D graphics accelerator core, vertex geometry processor and PowerVR MVED1 video encode/decode accelerator from Imagination Technologies. The SiRFprima multifunction processor delivers SiRF's renowned, industry leading, GPS-enabled location performance, featuring 64 channels with -161 dBm sensitivity. The hardware scalable location engine, with more than 1,000,000 correlators, is among the first capable of working with both GPS and Galileo signals simultaneously. Additionally, the SiRFprima processor has been specifically designed to support SiRF's proprietary GPS technologies, providing, for example, a dedicated accelerator for the SiRFInstantFixII(tm) technology.

SiRF Chips Dominate

SiRF Dominates Global GPS Handset Shipments and Evolving Location Based Services

GPS World

Global shipments of mobile handsets equipped with GPS capability will more than quadruple from 2006 to 2011 because of the U.S. government’s mandate for emergency 911 (E911) capability, as well as wireless operators’ initiatives to offer LBS, iSuppli Corp. said Thursday. GPS-equipped mobile handset shipments will increase to 444 million units by 2011, rising from 109.6 million units in 2006, according to the market research firm. By 2011, 29.6 percent of all mobile phones shipped will have GPS capability, up from 11.1 percent in 2006.

"Besides cameras, multimedia capabilities and connectivity solutions, mobile-handset OEMs increasingly are investigating the integration of GPS functionality in mobile devices as a value-added product differentiator," said Tina Teng, iSuppli wireless communications analyst. "Wireless carriers are looking at introducing various new GPS-based, revenue-generating services to increase average revenue per user (ARPU)."

Accuracy and Response Key to LBS, Say TruePosition, IDC

"Location-based services have been slow to take off in the United States, but these research findings clearly show that the U.S. market is getting good traction," said Robert Morrison, TruePosition's senior vice president of market and business development. "Due to the rise in navigation systems in cars and websites that provide directions and points of interest, both consumers and enterprises in the United States are now grasping the concept of location-based services, and they have very specific ideas about how they should work."

The study asked consumers and enterprises in the United States exactly what they want and expect from the following LBS: child monitoring, medical and senior-citizen monitoring, pet tracking, navigation, traffic, stolen vehicle recovery, social networking, local search, fleet tracking, and workforce management.

When selecting the features that were most important to mobile navigation services, people ranked the ability to use the service in dense metropolitan areas first, according to IDC. The ability to use the service nationwide was second, and re-routing was the third feature.

As for local search, more than half of consumers are receptive to advertisement-sponsored local search services, which could prove to be a significant new source of revenue for mobile operators. Local search on cell phones looks to be the low-hanging LBS fruit for the wireless operator community, but only if they can agree on a free-advertising-based business model. Only 25 percent of those surveyed would consider paying for the service, IDC said.

The survey also found that security seems to be a key factor in determining whether location-enabled mobile social networking will take off. Consumers are unlikely to subscribe to these types of services unless service accessibility can be limited to authorized users and a process is in place to keep out strangers.

Overall, consumers revealed that they were extremely receptive to location-based services, providing they perform at the optimum levels—essentially, working wherever and whenever their mobile phone worked, IDC found. The majority of the respondents wanted the services to work in several different types of environments (outdoors, indoors and in vehicles), desired sub-50-meter accuracy, and required a sub-15-second response time.

But What Do Businesses Want from LBS?

From an enterprise perspective, LBS user preferences between the three geographies were remarkably similar. Workforce management and fleet tracking services were highlighted as the most prevalent uses of LBS by businesses. Some 74 percent of respondents to the survey viewed productivity improvements as a key benefit, while 69 percent saw cost savings as another key benefits. Also, businesses ranked the safety and security of their workers as the most important feature, with ease of implementation coming in at a close second.

SiRF Technology Holdings Inc. unveiled its SiRFecosystem strategy and introduced SiRFstudio, a standards-based, end-to-end LBS platform.

SiRFstudio is designed to simplify and speed the development and deployment of location-aware applications across a broad range of mobile devices, SiRF says. It is part of what SiRF has dubbed its SiRFecosystem, a suite of tools and resources to speed development, testing, deployment and marketing of LBS applications that drive higher average revenue per user. More than one hundred companies worldwide are already participating in the SiRFecosystem LBS developer community, according to SiRF.

SiRFstudio intends to make location an intrinsic and useful part of every mobile device, combining with and enhancing applications people use the most from calling, messaging and browsing to address books, calendars and e-mail, the company says. It is a superset of the JSR-179 location (application programming interface) API, supporting multiple integrated development environments such as Java Wireless Toolkit 2.3, and offers software developers standard APIs for accessing location capabilities across multiple devices, operating systems and location technologies.

Today the revenues wireless service providers receive for voice services far exceed those they receive for data services, SiRF observes. In contrast, in the U.S. and many other countries, wire-line data revenues already exceed voice revenues, and wireless service providers are understandably eager to close this gap. SiRF believes wireless data revenues will follow a similar trend, and that location will be a key contributor in closing this revenue gap by providing a context for mobile content, the company says.

The Lowdown on SiRFstudio

SiRFstudio comprises both client and server components. The SiRFstudio thin client resides on the mobile device and provides developer-facing APIs for the rapid development and integration of location-enabled applications.

OEMs and ODMs can employ these APIs to location-enable their native applications, while third-party developers can employ them to create downloadable and browsable LBS applications as well as widgets, according to SiRF. These open, common APIs will extend across all major device operating platforms, including Java, Windows, Linux and Symbian, and are compliant with all major standards, including JSR-179, Open LS, OMA MLP and SUPL and support the Web2.0 Widget environment, including Mobile Ajax and the JavaScript runtime.

SiRFstudio Server has a multi-protocol gateway that receives requests for location data from the SiRFstudio client over any available wireless link and delivers the available location data back to it. SiRFstudio Server interfaces with most of the major geospatial data platforms worldwide, including Autodesk, ESRI, Webraska, Navitime, Microsoft, DeCarta, Telmap, Maporama, Tele Atlas and Navteq, among others, the company says.

SiRFstudio Server's location intelligence capabilities support peer-to-peer location to communicate user location with others, geo-annotation to create location-based user content, geo-publishing for location-based RSS and real-time feeds and a geo-agent for event-driven alerts based on time, location, speed, heading or motion. The SiRFstudio Server vending machine interface provides a turnkey solution for both on-deck and off-deck content distribution, the company says.