By Dawn Tay

THE dedicated global positioning system (GPS) device, one of Singapore's favourite tech toys in the past few years, seems to be falling out of favour.

Sales of such devices in Singapore have plunged by almost 40 per cent in the first half of this year from the same period last year, said technology market-research firm Canalys.

The New York Times reported last month that global shipments of standalone GPS devices will grow just 19 per cent this year, down from 131 per cent in 2007.

The recession and the rise of cheaper GPS-enabled mobile phones and smartphones are responsible for the drop, say industry players.

Up to last year, sales of dedicated GPS devices were booming as prices fell from around $600 a unit, to $400. About 70,000 units were sold here last year, up from 40,000 in 2007.

The growth of GPS-enabled mobile phones and smartphones - analysts estimate a growth of around 50 per cent this year - has eaten into the dedicated GPS device market.

Increasingly, phone manufacturers such as Nokia are providing users with devices that let them navigate and communicate.

Market-research firm GfK Asia's regional senior account manager, Mr Kevin Huang, said: "Bundled mobile navigation services, such as those offered by Nokia, will affect the dedicated GPS device market. There are also free navigation services available online."

Google launched its free Google Maps Navigation for mobile phones last month. This is confined to the United States for now, but some international industry players say that this further threatens the GPS-device market.

A recent report by technology and market-research company Forrester predicted that the GPS-enabled mobile phone would replace the dedicated GPS device as the navigation tool of choice.

It attributed this to the "massive adoption by Gen Y and Gen X consumers...(who are) increasingly reliant on their mobile phones. (They) demand socialnetworking and other connected services (that are) integrated into their navigation experience."

However, there is still hope for the GPS-device market here.

As the economy recovers, Canalys projects that it will resume growth at a compounded annual rate of 9 per cent till 2013.

There will also still be those who favour dedicated GPS devices over GPS-enabled mobile phones, said Canalys senior analyst Daryl Chiam.

EastGear business-development director Simon Goh agrees, saying: "Some people will still prefer the larger screen and faster map display of dedicated GPS devices. They are also more reliable if you're travelling overseas, especially in places that do not have 100 per cent 3G coverage."

The company, which retails brands such as Garmin and Holux, said that it has seen a two-fold increase in sales compared to the previous year.

Another local retailer, Navicom Technology, declined to provide figures, but said that sales were growing.

Innovation is key to staving off competition, industry players say.

Next-generation GPS devices feature 3-D maps and can plot routes based on live traffic alerts. Garmin also recently rolled out the nuvifone, which is a hybrid navigational device and mobile phone.

Civil servant Alethea Kerk, 24, who prefers using her GPS-enabled BlackBerry over a standalone GPS device to navigate the streets, said: "My phone is an all-in-one device and I don't have to buy another. It's easy to use and I can zoom in on the maps. The hassle of carrying a GPS device doesn't bring any further benefits."

dawnt@sph.com.sg