I wrote last year that phone-based navigation would overtake both the in-built car systems and the devoted Portable Navigation Devices (PND) made by the likes of Garmin and TomTom, and that it would happen by 2013. Certainly Google's introduction of Google Maps Navigation on Motorola's Droid removed one of the primary barriers to realizing this shift: price. Unlike the turn-by-turn navigation services offered by US carriers (primarily powered by TeleNav) that cost $9.95 per month or are bundled with other services, Google's application is included with the Droid (and its Nexus One) and costs nothing to use.

Nokia also offers turn-by-turn directions as a premium service on its GPS-enabled devices that support Ovi Maps. That is, they did until today — Nokia just announced that:
  • Navigation is free from now on… Beginning today, every Nokia phone equipped with GPS will include not only Ovi Maps but also turn-by-turn navigation. And that's not just in the country in which the phone is sold, it includes every country covered by Ovi Maps (72 according to this, 74 according to Nokia). Until today, an annual navigation subscription would have cost you between €39.99 and €59.99 depending on geography.
  • … As is the other protected Maps content. It's not just the navigation itself that will have the pay wall removed. All the other DRM-protected content within Ovi Maps, including Lonely Planet and Michelin guides for 1000 destinations,  will also be included in the standard Ovi Maps package that is included with the GPS-enabled device.
  • A portion of its installed base can unlock navigation. In addition, consumers who own a GPS-enabled Nokia device that runs either Series 60 version 3.2 or Series 60 fifth edition (aka Symbian^1) can, in short order, unlock the protected services on their device. (According to Nokia, the ten initial devices available for upgrade are the 5230, 5800 Xpress Music, 5800 Navigation Edition, 6710 Navigator, 6730 Classic, E52, E55, E72, X6, and N97 mini.)

Why did Nokia make this change, and why now? Google's influence is a big part of the story but not all of it.

  • The writing's on the wall for navigation revenue. Google's move clearly punctured the navigation service balloon. Nokia could have held out longer, but every day that passed would have weakened their position.
  • Their new devices will look a lot more competitive to consumers. As I've written, 2010 will be a huge year for Android-based devices, and the vast majority of them will come with Google Maps Navigation. Ovi Maps is a really good application (and service), and the navigation is superior to Google's in many ways, but even superior features can't beat free. For consumers in 71 countries other than the US — the majority of which are Nokia strongholds — it's no competition since Google doesn't provide navigation outside the US (yet).
  • Ovi Maps is more operator-friendly. In case you haven't heard, operators are walking a fine line with regard to data loads on their networks. Google's application is entirely network-dependent, downloading maps and routing each time it's invoked (modulo a bit of caching) — a rush hour traffic incident that prompts all those Droid users to search for a better route is not a good scenario for an operator. Ovi Maps stores its maps locally and so places a much lighter load on the network, plus it will work even when out of network range. It remains to be seen how operators like AT&T will evaluate the balance between this advantage and the lost navigation revenue.
  • Nokia is committed to its social location strategy. As they outlined during Nokia World in Stuttgart last year, Nokia sees a range of revenue opportunities in services that rely on mapping and location but tie into their customers' social behavior rather than navigation. Nokia is arming developers with their Ovi Maps API in the belief that these partners will craft a range of new applications tying maps, location, communication, and content, all tied into Ovi services.

It remains to be seen whether Nokia's services strategy will succeed, but this is a bold statement of affirmation of that strategy and, given where navigation revenue was headed, this bet looks like a smart one.