Broadcom Corp (BRCM)

ph0b05 thinks if Broadcom Corp were a Sex & the City star, it'd be Carrie Bradshaw.

by Carlos Portocarrero, WeSeed Writer Have you noticed how popular GPS technology has become? Every car on the road seems to have one now. But GPS has other uses too, like keeping track of your pets (or kids) and making video games interact with social networks. Wouldn't it be cool to race against NASCAR drivers in the Daytona 500 in real time on your Xbox 360? It's just one of the many nifty things GPS can - and eventually will - do. If GPS is going to rock our world, shouldn't we consider investing in it? Let's take a look at who makes GPS chips and how they're positioned for the GPS boom. We all know the usual names in this space: Garmin (GRMN), Magellan and TomTom. But those are just GPS devices. They still need the electronic guts - the actual GPS chip - to do what they do, so we need to look under the hood to see what's inside. The biggest GPS chip maker is SiRF Technologies (SIRF) - they own 70% of the market. You'll find their GPS chips in Research in Motion's (RIMM) Blackberry devices and some of Garmin's models too. Broadcom (BRCM) is another player - they make the chips inside the new iPhone 3G. Which is all well and good but when your main competitor has 70% of the market cornered, you'll need more than the iPhone to get you over the top. They also just beat SiRF in court over a patent dispute. But prices are falling fast and there isn't much to differentiate one chip from the next. SiRF is the industry leader but their stock has fallen hard, losing 80% of its value since November. It just goes to show you sometimes going under the hood doesn't pay off. If SiRF's stock has fallen this hard even with the huge advantage they have, this industry might be one where you're better off going with the Apples (AAPL) and Garmins of the world, who turn what's become a commodity technology into a high value-add product. Besides traditional GPS devices, the new uses like cell phones and others have huge potential. Navteq recently described a bird-watching application that would let people share which birds they've seen and where. With new ideas like that coming out every day, there's no doubt GPS is going to start playing more and more important roles in our lives. The question is, can we profit from it somehow today?