New satellites seen invigorating satnav industry

* Russia, EU, China, India to launch rivals to GPS tech

* Russia’s Glonass system first to launch late this year

* Glonass could be the best tech in 2014-18 -analyst

* New satellites give faster, more accurate positioning

* Seen expanding satnav to road pricing, planes

By Tarmo Virki, European technology correspondent

HELSINKI, Sept 28 (BestGrowthStock) – A Russian satellite system is
the frontrunner among several rivals that could expand the use
of satnav beyond mapping and car navigation, replacing aging
U.S. satellites.

Russia has been developing Glonass, its answer to the
U.S.-led Global Positioning System (GPS), since 1976. Having
spent $2 billion in the last 10 years, it is now in the final
stages, and is expected to be fully operational late this year.

“From 2012, thanks to the launch of additional satellites in
2010 and 2011, it is likely that Glonass will provide a
comparable service to GPS,” said Frederic Bruneteau, managing
director of Ptolemus Consulting Group.

He said Glonass will likely be the best performing
technology for 2-4 years from 2014 until the launch of the
European Galileo network, as GPS quality is expected to degrade.

“Glonass is now ready for prime time. However its lead will
not last more than a few years,” Bruneteau said.

Analysts said leading global chip makers are ready to
include Glonass and other new satellite technologies from
Europe, and from China and India which are working on launching
their own positioning satellite networks.

Governments behind new satellites are also looking to cut
their dependency on the GPS system — operated by the U.S. Air
Force — and the dozens of new satellites to be launched will
make positioning a device quicker and more exact.

Harold Goddijn, the chief executive of Dutch navigation
device maker TomTom (TOM2.AS: ) said new satellites could boost
usage of positioning systems in new areas like road pricing or
plane safety.

“I recognise that small incremental improvements of certain
technologies can lead to a completely new deployment of these
technologies. Its often the last little bit that helps you to
tip the balance,” Goddijn told Reuters.

Glonass’s success would mark Russia’s most ambitious foray
into the global high-tech market and contribute to the
government’s goal of diversifying the economy away from the
energy sector.

On Tuesday China’s ZTE (0763.HK: ) and Russian partner Sistema
(SSAq.L: ) unveiled the first robust-looking navigation device
using both GPS and Glonass technologies.

In July, Russia threatened to block imports of cellphones
and other devices not enabled for Glonass and Prime Minister
Vladimir Putin said last month the Glonass system could be
installed on all cars sold in his country from 2012.

The move would hurt most Russian buyers of cellphones, while
also squeezing smaller manufacturers of positioning-enabled
devices.

“In the short term consumer choice would suffer,” said
Canalys analyst Tim Shepherd.

RISE OF NEW CHIP INDUSTRY?

For any new positioning technology to spread widely it would
have to be included initially on GPS chips.

Egil Juliussen, automotive analyst at research firm iSuppli
said adding Glonass technology to the GPS chips will slightly
increase their costs, as these will require more memory and more
computing power.

“It is important to make a market for Glonass-compatible
chips. The straight forward way to do so is what Russia is doing
and it should work,” Juliussen said.

“As the Glonass-compatible chip volume grows, the price
premium will decline and then it will make sense to use these
chips if and when additional accuracy is needed in all regions,”
Juliussen said, adding this was likely a few years away.

Several Russian firms such as Navis, GeoStar Navigation and
Sitronics (SITR.RTS: ), part of Sistema, are developing the
chipsets, with mass production expected to start in early 2011.

(Additional reporting by Harro ten Wolde in Amsterdam;
Editing by Erica Billingham)

New satellites seen invigorating satnav industry