Nokia says to offer free maps to smartphone users

(Nokia)

Nokia, the world's top mobile phone maker, will offer free maps and navigation services for its smartphone users, it said Thursday in a move that puts pressure on players in the GPS industry.

"We are offering global car and pedestrian navigation in 74 countries, in 46 languages ... Ovi Maps becomes completely free from this moment onwards," Jukka Hosio, director of Nokia's services marketing, told a press conference in Helsinki.

The move follows and takes a step further a similar play by Google, which said last year it would offer free navigation to users of Motorola's Droid cellphone model in the United States.

With its global move, Nokia increases the pressure on key companies in the global navigation market like Tom Tom and Garmin, which are likely to suffer from an increase in smartphones that support navigation applications.

Consultancy firm iSupply said in September it expected the GPS market to fall for the first time in 2009 after years of booming growth and to fall off in the longer term afer a rebound this year and next.

It expected the number of smartphones with navigation programs to exceed the number of GPS devices by 2014, whereas today there are twice as many GPS devices compared to smartphones.

Shares in Tom Tom slumped on the news from Nokia and were down 6.96 percent at 6.14 euros in Amsterdam at 1505 GMT while Garmin shed 2.72 percent to 35.10 dollars in New York.

For Nokia the move is an attempt to boost its own position in the global smartphone market, where it has lost market share to rivals like Apple's iPhone and RIM's BlackBerry.

In mid-October, the Finnish firm posted its first loss in a decade, hit in part by tough competition in the top-end smartphone market.

"I suppose Nokia thought it could stop some of the slide it has seen in the smartphone market with this move," said FIM analyst Michael Schroeder.

"This is such a tangible, useful service that the fact that it is being offered for free will likely attract buyers. But will it be enough to stop the decline in Nokia's market share, I don't know," Schroeder said.