Apple iPhone GPS
June 13, 2012

Will The New iPhone Kill GPS Makers?

Michael Harper for

Apple has yet to stray from their upward trajectory, and Monday´s Keynote proved they´re likely to remain on this path for the next several years. Not every company is able to hang with Apple at this altitude, however, and sometimes Apple must step on a few shoulders in order to achieve such great heights.

After all, Scott Forstall announced on Monday Apple has sold more than 365 million iOS devices as of March.
With that kind of weight, Apple can easily trample smaller businesses underfoot as it makes its way to the top.

Now, car audio and GPS maker Harman may feel the pinch from Apple´s announcements.

Smartphone manufacturers have been putting the pinch on GPS makers for a few years now. Smartphones are easier to carry and often already in our pockets anyway, making the extra purchase of a single-use GPS machine seem less than luxurious“¦it´s downright silly.

As reported by Reuters, the markets feel the same way, as shares of Harman fell as much as 10% after Apple announced their brand new Maps application, which features GPS, traffic reporting and turn-by-turn navigation.
In addition to their GPS devices, Harman also provides the audio equipment for car makers such as Audi and Mercedes.

Also feeling the pinch is fellow GPS maker Garmin as their shares also fell after Monday´s announcements. Not only will Apple feature better navigation through their Maps app, they will also utilize Siri, their Intelligent Personal Assistant. Apple announced plans to work with Audi and Mercedes–as well as other car makers–to integrate Siri directly into their navigation systems, allowing her to be called up with the tap of a steering wheel button. Apple is calling this feature “Eyes Free,” and according to some analysts, it will be the next big thing in the world of auto navigation.

JPMorgan Analyst Mark Moskowitz told Reuters, “Within the next 12 months, Siri will be the backbone for ℠Eyes Free´ service, integrating Siri and maps into automobiles.”

Not all companies in the GPS space are being run over by Apple´s move into this market. TomTom today confirmed suspicions that they will be working with Apple to help create their new Maps app, assumedly by generating some map data for the iPhone maker.

On their website, TomTom issued this short, Apple-esque statement: “TomTom“¦has signed a global agreement with Apple® for maps and related information. No further details of the agreement will be provided.”

Should Harman continue to suffer losses from this news, it´s likely they´ll make a big sound. In January, J.D. Power and Associates ranked them as the top supplier of navigation systems. If Harman leaves the industry, it´s likely the car manufacturers once serviced by them will turn to Apple or Android to continue offering these navigation systems. In addition to falling 5% after Monday´s announcement, shares of Harman fell an additional 9% on Tuesday. Garmin shares were up by 3% on Tuesday, despite being down by 9% after Apple´s keynote.
TeleNav Inc also saw their shares drop as much as 12%.