Lucrative and Promising Growth Seen for the GPS Chipset Market3 February 2006
Global Positioning System (GPS) receivers are poised to play a critical role in wireless communications as a result of the United States Federal Communications Commission's (FCC) E911 directive and location based services (LBS) are expected to follow on the heels of the mandate. Successful E911/LBS products and services will require solutions with features that can implement GPS in mobile telephones.
New analysis from Frost & Sullivan, (http://www.semiconductors.frost.com ), Strategic Analysis of GPS Chipset Market, reveals that the market earned revenue of $207 million in 2004 and estimates to reach $589.1 million in 2008.
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The third generation of GPS receivers presently available already exhibits significant gains in miniaturization, reduction in power consumption and portability, over the earlier models.
"This trend is expected to continue," says Frost & Sullivan Research Analyst S. Nagarajan. "Surveying receivers are likely to decrease in size to fit into a car radio and then into a mobile phone. However, there is also a trend to pack more electronics into the receiver box."
The miniaturization of much of the electronics (particularly the tracking channels) onto VLSI circuits means that less power is needed for the receiver to function. However, the challenge is to develop small, lightweight, long life batteries. There have been many predictions of low-cost GPS receivers. Many handheld navigation receivers are available for just a few hundred dollars. It is doubtful whether the cost of GPS surveying receivers will ever fall below a level that is typically ten to a hundred times the cheapest receiver, for a number of reasons.
"In addition, much of the pre-processing of the data will be carried out within the receiver, including operations such as cycle slip editing, data compression, automatic and continuous operation of the receiver and real-time carrier phase-based positioning," says Nagarajan.
The small-sized, low-cost OEM receivers are well suited for developing new applications. Hence, miniaturization is one crucial factor for the development and penetration of GPS systems into the market.
The lower costs have become a reason for the slower and meager revenue generation for the GPS chipsets market. The sudden decrease in the prices and almost no increase in revenue generation in cases of GPS systems in mobile phones has put pressure on the vendors. This acts as a restraint in the growth of the GPS chipsets market. The cost of the basic GPS chipset has continued to decline steadily, leading to the relatively thin profits in high-volume consumer electronics.
High-margin GPS products tend to be those with specialized software content or where GPS provides crucial functionality. Demand for smaller handsets leads to reduction in form-factor and die size, which corresponds to an additional decline in the price of the transceiver chip.
"The growth of civil GPS applications and user equipment represents a very pure form of market competition in that GPS signals are provided as a free public good. There is no limit to the number of potential users and the marginal cost to the system of an additional user receiving a GPS signal is zero," says Nagarajan.
Unlike air or water, GPS signals are not a resource, which creates "haves" and "have-nots." The government has developed and bought GPS equipment for military purposes, while commercial industry and customer investments have created the wide range of civil applications seen today.
Strategic Analysis of GPS Chipset Market, a part of the 9952 subscription service, provides an overview and outlook for the market. This study has been segmented into GPS RF chipset Market, GPS Baseband Chipset Market, GPS LNA Chipset Market, and GPS Flash Chipset Market. This research includes detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants. Interviews and executive summaries are available to the press.
Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company's industry expertise integrates growth consulting, growth partnership services, and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies, and the investment community by providing comprehensive industry coverage that reflects a unique global perspective and combines ongoing analysis of markets, technologies, econometrics, and demographics. For more information, visit http://www.frost.com .
Strategic Analysis of GPS Chipset Market
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Keywords in this release: Global Positioning System, GPS, chipsets, receivers, miniaturization
Source: prnewswire
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