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TomTom says it's wary of Google, but that the navigation company isn't going anywhere

December 3, 2009 |  3:15 pm
TomTom on iPhone. Source:
TomTom, the navigation technology company that says it has sold 30 million portable navigation devices in the U.S. and Europe, took a major hit to its stock in October when Google Inc. announced it would be giving away its own turn-by-turn navigation software to owners of many smart phones.

The Dutch company's stock is down nearly 40% since the announcement that sent shivers through the navigation industry, which has long charged both for its devices and for its service.

Google's move raised questions about whether stand-alone navigation devices were still necessary in the face of intelligent handsets that can perform thousands of functions.

But TomTom says that "rumors of the death of the portable navigation device are premature."

"I think there's been perhaps a bit of overreaction," Tom Murray, vice president of market development at TomTom, said in a visit to The Times today. "I don't really share in the worries. There are a lot of things that Google has to do in order to have a material impact on our business." 

"It's not going to change the landscape overnight," he continued, acknowledging that the issues was "top of mind" for industry insiders. "It's provocative, but when the dust settles, it'll just be another player, and it'll prompt us to get better."

Murray highlighted what he said were still major differences between what Google might offer on smart phones, and the kinds of features stand-alone units have: larger screens, louder audio directions, longer battery life. Most simply, he said, a dedicated navigation device is not as vulnerable to the "multitasking problem," where users may have to make a choice between making a phone call or checking their e-mail (not recommended while driving!) and using their mapping software.

Still, Murray said, though revenue from TomTom's iPhone app has been a small slice of the company's overall income, it has sold more than 100,000 copies of the app, making it one of the top-grossing apps available on the iPhone. That milestone is made more remarkable by the TomTom app's hefty price tag. At $99, the app is the same price as TomTom's lower-end standalone devices.

The company considers itself a software maker first, Murray said. TomTom plans to be flexible enough to work on a variety of devices and handsets, ideally enabling users to maintain one account that works across multiple platforms.  

But for the time being, Murray said, Google's Android mobile operating system may not be one of those platforms. Though Android will be available on more than a dozen smart phones this year, TomTom would not comment on when or whether it will even try to compete on Android.

"Maybe that wouldn't be the best place for us to invest, although I'm not saying we're ruling it out."

-- David Sarno