Map Wars: Nokia Attacks Apple and Google
Chris is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
For the first time in what seems like years, I hopped on Mapquest.com. Did you know that you can calculate a round trip, then add in your vehicle to estimate the approximate gasoline expense? Mapquest is slick, and it has come a long way.
The problem for Mapquest is that it lacked the strong distribution network to insulate itself from the new tech giants. Now that large brand names are entering the battle for map users, it is even harder for Mapquest to gain new market share. But while Mapquest lacks great distribution, Nokia (NYSE: NOK) is excelling at it.
In 2007, Nokia bought Navteq for $8.1 billion, hoping to give a boost to its location and commerce businesses. Since starting in the auto industry, Nokia has continued to expand. The company has been busy inking deals with BMW, Mercedes, Hyundai, and Volkswagen. Now it has added Groupon, Amazon (NASDAQ: AMZN), Oracle (NASDAQ: ORCL), and even Garmin to the list.
Amazon used to use Google Maps, but it switched over to Nokia’s data. Also, Amazon purchased 3D mapping app UpNext in an effort to build its own mapping software for iOS 6. Amazon believes that it will succeed with the rollout.
Nokia’s deal with Oracle is even more important. The new agreement gives Nokia the opportunity to put one foot in the consumer market and another in the business market, where Oracle is expected to add Nokia’s service. According to PC World:
Part of Nokia's location strategy is signing deals for the use of its Navteq mapping technology with as many companies as possible. As part of the deal with Nokia, Oracle has developed an integrated link between its Fusion Middleware MapViewer and the Nokia Location Platform (NLP). Fusion Middleware MapViewer is a J2EE service for rendering maps and creating mashups using location data, according to a statement.
Even better for Nokia, “Enterprises that want to take advantage of the integration and use NLP in Oracle applications will first have to license it from Nokia,” reports PC World.
Nokia’s deals spell bad news for Google (NASDAQ: GOOG) and Apple (NASDAQ: AAPL). Google has seen some of its commercial users, like Amazon, gravitate to Nokia. Also, the loss comes at a time when Apple just dropped Google Maps in favor of its own mapping service.
However, Apple’s attempt has not worked as well as it hoped. Some locations have been reported as being faulty, and Apple CEO Tim Cook made a public apology in which he casually suggested that customers can use the maps from companies like Google, Nokia, Bing, and Mapquest until Apple’s maps are ready to go. However, he did encourage users to keep using Apple’s maps, and he said that 100 million Apple Map users have searched for over 500 million locations in “just over a week.”
In short, Apple and Google will not be battling one another for control of the map market – as some expected. Rather, they are now battling Nokia, which has been busy lining up distribution deals for its mapping services.
In all, mapping services have evolved from simple online directions to a portable GPS on a phone. Companies across numerous industries need mapping services to power their products, and the company capable of signing the most deals will win the day.
While websites like Mapquest are still alive and well, and others like Apple and Google keep improving their products, Nokia’s business development looks compelling, and its features look rich. Though I never would have though it possible, with a few more sneaky surprise deals perhaps Nokia could win the day.
Compare and Contrast
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ChrisMarasco has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Amazon.com, Google, and Oracle. Motley Fool newsletter services recommend Amazon.com, Apple, and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.