This week, Google rolled out an update to its Maps service that added free voice navigation for UK Android users on v1.6 and up, putting it toe to toe with dedicated sat-navs - and indeed, with Nokia's Ovi Maps, which also offers this and more for free.
Together, both services are preloaded on dozens of handset models, and higher-end smartphones have free access to the full range of premium features - including live traffic information and voice direction - that sat-nav devices offer for a cost.
And the question a lot of people are asking is, should sat-nav manufacturers be getting worried? Companies like TomTom, Garmin and NavMan will maintain that they offer a premium experience - bigger screens, clearer voice instructions, superior routing, bundled in-car mounts. But smartphones can navigate to a standard acceptable to most, and on top of that, be used for other location-aware apps that could give shop or restaurant recommendations like Qype.
Nitesh Patel, analyst at Strategy Analytics, doesn't believe that free mobile sat-nav will hurt dedicated devices too much. Sat-navs are purpose-built with screens of at least 4.3 inches; higher-end Android models max out at 3.5-3.7 inches. Accuracy is another issue - my HTC Hero and Google Maps have certainly failed to find my location at least a few times (especially, for some reason, in Central London). And there is still one major downside to actually using your mobile as your only sat-nav device - battery drain. Combatable with a car charger of course, but it's still one extra step. Don't forget about the non-techies (and 'older user segment' as Patel puts it) who prefer dedicated devices. Sat-navs still trump on one key factor - they work right out of the box.
There's also the screen type - bright AMOLED displays such as that found on the HTC Desire are great for movies, but tend to reflect glare in sunlight more than standard screens, and can be hard to view when propped vertically on a dashboard.
Of course, all this could change. Samsung recently launched the Wave, a phone packing 'Super AMOLED' screen tech which minimises screen glare and increases viewing angle. It is releasing the technology to other manufacturers too, so we can expect more phones with this feature in the coming months. And the upcoming Samsung Galaxy S is a touch-screen phone with a four-inch display, just about nipping at the heels of a sat-nav screen. It runs on Android 2.1, which supports voice-to-text, meaning you'd be able to vocally instruct your phone to 'navigate to' any place you wanted.
Dedicated sat-navs have the edge for now - particularly for people who spend a lot of time on the road - but to stay in the game, manufacturers are going to have to do a little more. They'll have to produce devices that can do some of what smartphones can do - for example, uber-connected devices that can get online, perform real-time search for things and places, not just addresses, and most importantly, update maps over the air, rather than requiring users to manually sync it with a PC. TomTom's GO 950 Live, for example, has an interesting 'MapShare' feature where you and other drivers can add corrections or notes to existing maps, and sync your own maps with these changes.
Garmin, an innovative manufacturer with sat-nav devices that do come with a web browser, already has a line of sat-nav-phones with Asus. I recently saw the Android-powered nuvifone A50 that lets you search for 'places of interest' by category - search for Chinese, and you'll get a list of nearby restaurants that you can either call or navigate to, direct from the screen. That's the kind of integrated service that smartphones currently offer, and sat-nav devices should follow suit.
But Patel also says that though the sat-nav market will be impacted, the real consequence of free mobile maps services lies in the casual user who isn't on the road enough to justify buying a sat-nav, and pedestrians who just need maps and routing on their mobile, never mind the voice guidance.
If they were going to pay for navigation at all, these users would probably have gone for navigation apps such as TomTom or CoPilot Live. Considering TomTom costs £60 and CoPilot £25 and up depending on the region you want maps for, they're probably going to be the first casualty of Google's new free sat-nav.