Benefon, the Finnish consumer electronics firm, has formally entered the Chinese market by opening an office in Shanghai.
Benefon, listed on the Helsink stock exchange, is best known for its GPS-enabled mobile phones and its interesting that it sees potential in China for these relatively expensive gadgets -- the retail price for its Twig Discovery navigation device (pictured left) is €550 in Europe.
As Benefon admits, the market for personal navigation devices is relatively immature in China. But that means that China is also a lot less saturated that Benefon's established markets in the west, where it admits that sales in first half of 2007 have been "below expectations due to intensified competition and price erosion."
One niche market for Benefon could be helping well-heeled tourists and foreign visitors find their way around China. In Europe, its already a common sight to see tourists clutching GPS devices instead of the traditional paper map as they stroll around the tourist hot spots.
But it will be interesting to see if Chinese take so readily to Benefon's GPS-enabled phones, given their high price.
Benefon doesn't compete in the dedicated in-car navigator market, where at least 40 companies slug it out and price competition is intense. Nevertheless, I suspect that given China's rapid car growth, this is the market where GPS devices are going to have most success in in China, just as has already happened in the west.
Jeff Lin has been recruited as managing director of Benefon China.
Before joining the company, he was general manager of a JV between
China NavInfo and Navteq , the US company specialised in digital map
data.
