Yesterday, we wrote about a new, free product from Google: Google Maps Navigation. Another free Google perpetual beta product, one might say; nothing to get overly excited about.

Well, the first reviews and reactions are in, and it seems that this is one of those Google products that change the landscape of an entire industry.

GPS turn-by-turn navigation has historically always been something you had to pay for. Creating and maintaining a map of the entire world, together with points of interests and traffic info, plus developing the algorithms that make sure you don't take a wrong turn, costs millions of dollars. But Google is now offering it for free. The result was devastating for shares of GPS navigation companies: Garmin's shares fell by 16.4%; TomTom's by 20.8%. We're talking billions of dollars of market capitalization, gone in one day, just because Google presented another free product (they release new products on a monthly, if not weekly basis).

This doesn't necessarily mean that TomTom and Garmin are going out of business. But it means that this entire space has fundamentally changed, and the market reacts to developments like that.

Do they do have something to fear? Absolutely. Google Maps Navigation isn't some half-baked, crippled free version of GPS turn-by-turn navigation. In most areas, it's comparable with standalone GPS navigation solutions, and it even brings some novelties to the table, for example Google's fantastic satellite view and Street View. The folks over at Engadget have tested it out with a Droid, you can check the results in the video below.

Right now, Google Maps Navigation works only on Android 2.0 devices. But as it spreads to other platforms and devices, it's obvious that everyone will get it. After all, it's free, so why not? People who used GPS navigation before will get it to see how well it works. People who never cared about it will try it out to see how it's like. In a matter of months, Google will control a huge, previously untapped portion of the market. From their competitors' perspective, it's a nightmare. From the user's perspective, it's fantastic: a free alternative for a service that you previously had to pay for. It'll be interesting to see where Google takes this, but I have a feeling that GPS navigation will get far more exciting in the future.