GPS Systems 1998: The Sky's the Limit
By Don VanderVeen

Competition among companies marketing Global Positioning Satellite (GPS) technology in the golf industry is becoming as heatedly contested as the top flights at your annual club championships.

The sky-based GPS technology -- which links together a stroke of a keyboard with a stroke of a club -- is out there in the final frontier and currently available for anyone with the capability to bounce the signals from the satellites. Sophisticated compasses, graphic or alpha numeric options and proprietary software have provided golfers with pinpoint yardage accuracy while providing a handful of GPS firms with ways to distinguish themselves from one another.

"Some can make it work and some can't," according to Douglas P. Dudley, president of Yardmark. "There are different features and levels of accuracy people are able to deliver. Unfortunately, we're all lumped together as GPS systems and anyone who puts out products less than up to par hurts us all."

Virtually all GPS companies have two things in common: they provide exacting yardage guides and all have tracking devices from the clubhouse. For whatever reason, GPS systems have another common characteristic: most of them are identified by names that combine two words into one. ProLink, Yardmark, SkyLinks, ProLink and ParView are among the "oldest" names in an infant industry that has been around for less than a decade.

Approximately 120 courses throughout the country have installed GPS technology. Michigan had nine installations during 1997. The growth potential for this part of the golf industry is enormous. The number of destination resort courses in Michigan make the state a major marketing target for GPS companies. Michigan-based Yardmark first cut its teeth with yardage systems at Boyne USA in the early 1990s. Yardmark's first electronic systems were originally installed with underground wiring before it began reaching for the stars.

"We've gone from 11 inches under the ground to 11,000 miles out in space," Dudley says.

Although GPS systems are primarily viewed as an amenity for the golfer, the technology may some day become standard equipment and be as useful for course maintenance applications as it does as a player enhancement. "It started primarily as a yardage enhancement, but where this business is going is in areas of course management," said Richard Beckmann of SkyLinks. "GPS is a business tool and will become much more for a course owner than charging for a yardage system. The market is going to change dramatically over the next two years."

Most systems have common elements such as distance guides, scorecards and two-way communication capabilities. Some systems offer alpha numeric enhancements such as distance of a shot, yardage to the pin and scoring. Others offer graphic views of each individual hole.

"The market is still identifying the core products," says Charles H. Bradshaw of PinMark. "There are always technology introductions taking place." There are several levels of options, enhancements and upgrades for these systems. Course management benefits include options such as food and beverage menus, course auditing capabilities, tournament scoring options and clubhouse tracking for speed-of-play.

Costs for GPS-based systems range from between $250,000 to $350,000 per fleet depending on the system and additional options desired. Installing a fleet of carts with the systems can take up to three months, depending on the availability of crews and equipment. "It's largely a revenue equation," says PinMark's Charles Bradshaw. "It's convincing owners the enjoyment added by the system merits additional revenues they may charge. When the benefits of course management features are taken into account, it is well worth it."

As GPS technology continues to grow in popularity, there are several key questions a course owner should ponder when deciding on whether or not to reach for the stars:

Which types of courses benefit most from GPS systems?

GPS yardage systems are a valuable enhancement for golfers on courses where target golf must be played and knowledge of yardage is important. It provides accurate options for risk-and-reward choices and giving the golfer an option of carrying over wasteland or water and/or avoiding bunkers protecting the greens. The systems also serve as a showpiece for upscale and resort courses where there is an emphasis on service and amenities, as well as for clubs catering to a clientele where the latest and best services are expected.

Amenities alone aren't the only thing that should be taken into account when considering installing GPS technology. ProLink, for example, has an Enhanced Reporting System (ERS) that provides the course owner with one source of information for everything that is happening on the course, from number of rounds played to where the carts are located. It provides an audit track of virtually all the action taking place on the course.

"It provides one source for all information of what's happening out on the course and in the pro shop," ProLink's Tim White said.

What options should golf course owners include on their systems?

Every GPS system is marketed on the basis of its own merits. Some offer more features and upgrade capabilities than others. Some stress simplicity. All of them claim that their most important feature is accuracy.

"There are going to be some common elements applicable across a broad base," White said.

Basic services most systems provide include exacting yardage to the hole, menus, tracking devices and two-way communications. Some systems are more detailed than others. Cost of the unit usually reflects upgrades in technology. "We're giving owners all kinds of information they've never had before, which enables them to manage their fleet a lot better," says ParView President Jerry Chessler.

More and more, GPS units are offering two-way communication devices for food and beverage menus. Offering menu ordering at the eighth and 17th holes, vendors claim, both increases food and beverage revenues, as well as speed of play. Some companies market their products on the assumption that graphic elements and visual appearance enhance the experience. Others claim that displaying a 500-yard hole on a four-inch screen is almost as challenging to figure out as actually reaching the green.

"We feel that in the long run, simplicity will make the best tool," said Jim Szilagyi, Michigan representative for SkyLinks.

Owners should make sure they know what features are needed for their particular course and demand adequate training for both running the system from the pro shop and out on the course. And, perhaps more importantly, remember that the system is meant to enhance a round of golf, not detract from it. "We put enough information into the golf cart so not to complicate the system for the golfer," says Clearwater Engineering President Lloyd Tozer, who markets the GPS system e-caddy. "We believe in giving the golfer enough to justify the increase in fees.

"We can easily load the system up with features, but we found by doing too much of it a golfer will go out there and play with the features on the system rather than concentrate on playing the game."

Those interested in purchasing a GPS system, however, should demand guarantees for performance criteria in their contracts and have their vendor clearly spell out tolerable levels of accuracy and what percentage of the fleet they can keep up and operating at all times.

How will the investment pay for itself?

Most vendors offer long-term lease options or financing terms to help reduce the up-front, out-of-pocket costs. "The seasonality requires that the course fits the characteristics that an owner would want from a system," ProLink's White said. A lease option for $6,000 a month could pay for itself if 3,000 rounds are played each month the system is up and running and $2 per round goes toward the financing cost. The remainder of the $5 to $10 surcharge is profit.

"The price range doesn't vary that much if you're going to offer the amenity as an operator," Dudley said. "The first decision you have to make is if you're going to make an appropriate level of fees to offset the cost of the system, you had better make sure it works well." Those charges are figured in when yearly greens fees are established. Golfers may consider it a luxury tax, but rarely notice it in the fee structure on courses where carts are mandatory, according to most GPS vendors.

Taking seasonality of Michigan winters into account, some companies offer time-share leases between northern courses and their counterparts down south. ParView, meanwhile, has a USA Today philosophy toward selling its product. National advertising accounts which appear on the system helps offset the overall cost of installation.

"That's how we have the most economical system on the market," says ParView President Jerry Chessler. "We accept the risk for advertising, which allows us to offer a lot more for a lot less."

So where does the technology go from here?

The sky's the limit when it comes to new product offerings linked to satellite technology. GPS may someday re-invent the way maintenance is done on golf courses. SkyLinks, for example, offers a Precision Turf Care Application that can be operated from satellite coordinates. By locking into the coordinates, robotics for night mowing, irrigation systems and other fertilizing applications are also possible.

"The GPS will be the spine of information of a golf course," Szilagyi said. Universal tee-time reservations and other course management enhancements are being introduced to the market.

ProLink is experimenting with technology which would allow golfers of similar handicaps play against one another by being linked together from their carts. Interactive tournaments can create a field of players from different courses throughout the country simultaneously matching their skills against one another through a GPS link.

The intangible commodity all GPS systems offer_besides being an amenity for the golfer and an effective tool for the pro shop_is that its courses with the technology will have a faster pace of play and result in

increased traffic played for the course. "It is a business investment," Szilagyi said. "You'll be able to manage inventory and the facility better than the guy down the road. The pace of play will improve, which is important to golf course owners. "Their most valued inventory is their time." For sure, owners will indeed need time to study and compare products in this fast-changing and fascinating industry.