“Significant GNSS market potential and opportunities ahead”

1) According to the report……, “Despite significant growth since 2006, significant untapped potential remains.” Would you like to elaborate on this?

According to the forecast based on available information sources and which involved several market experts, the global GNSS revenues are still expected to grow at a double digit CAGR in the 2010 – 2020 period. This growth will come from both new applications and expansion of current products and services. In terms of penetration, the biggest impact will come from LBS since GNSS is still only in a small portion of today’s mobile phones. Regarding new applications, there are countless examples such as ADAS (Advanced Driver Assistance Systems). As for GNSS R&D initiatives in the context of the EU 7FP program of the European Commission, being delegated to the GSA, there is a surge of GNSS technology projects proposing creative applications such as using combined radar and satellite navigation technologies to create maps of coastal areas. Advances in EGNOS and Galileo will accelerate these developments.

2) According to the report, the Road (56.4 %) and LBS (42.8 %) segments appear to dominate the core GNSS market (cumulative revenues 2010 -2020) whereas agriculture (0.6 %) and aviation (0.2%) would have negligible share in comparison. What could be the reasons?

The relative importance of each market segment is driven by the number of devices being shipped in each segment. LBS handset sales make up the majority, followed by navigation devices used in road transport. In aviation and agriculture unit shipments are much lower due to a smaller addressable market. Nevertheless, aviation and agriculture are important target markets for EGNOS, European satellite-based augmentation system.

3) The majority of GNSS market share is held by companies having their origin in the developed world (65% in EU, USA, Japan in year 2009 all together). How likely is this going to change, say in a scenario where China and India may emerge as one of the important markets for GNSS, in next few years?

We expect the share of emerging countries to increase as it is happening in other sectors of the economy. The revenues from civil applications of GNSS are dependent on the number of devices being shipped. India and China, being among the largest and most growing countries in the world, are expected to generate very important volume of GNSS devices.

The pace of change in emerging markets may be influenced by specific aspects. Actually, some GNSS applications may require structural changes in emerging countries that usually take time. In agriculture, for example, the addressable market can remain small, if farming is more human than technology-driven. In road, the usage of GNSS devices is correlated with the state of the road network in the country.

4) At the moment, it is projected that the Global enabled GNSS market (accounting full prices of GNSS mobile phones in LBS sector) will reach €244 bln in 2020. What could be the factors that may hinder the above projected growth?

Building the forecasting process, we made assumptions on a list of key factors like the GDP growth and the evolution of prices of devices which are influencing the GNSS market trend. The projected growth will also depend on other key environmental factors and of course also on GNSS relative advances vs. alternative technologies.

5) The report has focused on 4 segments – road, LBS, agriculture and aviation. Would you like to name a few more GNSS market segments that may have potential in this decade?

The GSA analyses market opportunities for GNSS in cooperation with industry experts, based on market research information and data available. So far we have focused on LBS and Road, the largest GNSS market segments, as well as agriculture and aviation which are today EGNOS target markets. In the future, we plan to analyse high precision (e.g. mapping, surveying), maritime and public services.

GSA, in the context of the EC Application Action Plan, cooperates and supports the European Commission. The GNSS Market Report will aim at continuing the analysis of GNSS market segments and emerging opportunities.

Boris Kennes is responsible for the coordination of the FP7 projects portfolio and market monitoring at GSA Market Development Department.
Justyna Redelkiewicz Musial is responsible for the market monitoring and forecasting process at GSA Market Development Department.