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Satellite Navigation Rings in on Mobile Phones

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These days, the cash register at Li Dawei's mobile phone shop in Beijing's technology hub of Zhongguancun sings with brisk sales, thanks to the surge in the usage of satellite navigation devices in the country.

Li's store sells about 150 mobile phones a month and more than 80 percent of his customers view satellite navigation as a must-have function when buying a mobile phone.

"It's definitely a trend. It seems now that everybody wants satellite navigation function and phone makers have responded well by incorporating the function into mobile phones," he said.

The size of China's satellite navigation devices market grew from 4 billion yuan (US$597.65 million) in 2003 to more than 50 billion yuan this year at an average growth rate of more than 50 percent, according to a research report by Shenyin & Wanguo Securities Co Ltd.

"The rise in the satellite navigation devices market correlates with the rapid growth of China's auto market. Over the past decade, we saw the numbers of vehicles on the roads increase at a rapid speed," said Liu Liang, an analyst with iResearch, an IT consulting company.

China's auto market surpassed the United States to become the world's largest auto market in 2009, with a record of 13.6 million units sold. In the first half of this year, auto sales surged 30.45 percent to 7.18 million units, compared to 5.6 million for the US in the same period.

Qiang Xiaozhe, head of the information and space division at the Ministry of Science and Technology, said that developing the satellite navigation industry had already been put into the draft of China's 12th Five-Year Plan period (2011-2015). He said this at the recent NaviForum Shanghai 2010, a satellite navigation industry event for industry leaders and decision-makers.

Qiang said new policies would be made to scale up financing in the sector such as encouraging qualified enterprises to float shares at local or foreign stock exchanges.

The Ministry of Science and Technology will cooperate with the Ministry of Finance to set up special funds to support startups, he added. Qiang predicts that the public satellite navigation market could reach 250 billion yuan by 2015 and 400 billion yuan by 2020.

Liu at iResearch believes that satellite navigation functions will make in-roads on smart phones, which could become the dominant satellite navigation device in the future. The reason is that the functions provide huge business opportunities in social networking and marketing, said Liu.

Foursquare, a location-based social networking software for mobile devices, has attracted 500,000 users internationally as of March. The software, available for iPhone, BlackBerry, Android phones, and Palm's Pre and Pixi models, allows registered users to connect with friends and update their location via satellite navigation functions.

(China Daily September 28, 2010)

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