Nokia targets pedestrians with Navteq acquisition
BARCELONA (Reuters) - Nokia (NOK1V.HE: Quote, Profile, Research) aims to produce better maps for pedestrians and with their help after completing its $8.1 billion acquisition of map supplier Navteq (NVT.N: Quote, Profile, Research), leaving the car-navigation market largely to others.
"It's not really our intention to take market share away. It's our intention to grow the market," Michael Halbherr, the head of Nokia's location-based activities, said on Thursday.
"We want to take the intelligent mapping experience to the pedestrian," he told the Morgan Stanley Technology, Media and Telecoms conference in Barcelona.
Nokia's agreed bid for digital mapmaker Navteq, the biggest in its history, cast a spotlight on the fast-growing navigation industry and was quickly followed by a bidding war for Tele Atlas (TA.AS: Quote, Profile, Research), Navteq's only global rival in mapmaking.
TomTom (TOM2.AS: Quote, Profile, Research), currently the highest bidder for Tele Atlas with an offer valuing it at 2.9 billion euros ($4.2 billion), said it would remain focused on car navigation but Tele Atlas would likely still supply handset makers.
TomTom Chief Executive Harold Goddijn said it was unclear how Nokia's entry into the market would change the competitive landscape but said it removed the worry that Tele Atlas customers might switch to another independent mapmaker.
Nokia's Halbherr said Nokia's aim was to bring detailed maps for pedestrians to the hundreds of millions of Nokia phone users worldwide, enlisting the help of those same customers to keep its maps up to date.
"Mapping will go to the next level. That's one of the things where communities can help," Halbherr said. "We have the world's biggest media-capture device. It means people can capture content, put it on the map and share it with others."
Halbherr said owning a mapmaker meant Nokia would be able to direct its own strategy in areas previously of little interest to a car-focused industry.
"With a map supplier in house, we can have long-term basic planning and can invest aggressively in places like India, where they didn't necessarily see a market," he said.
"Historically, map suppliers go to the high-end car segment. We can change that. There's a whole set of advantages that make this buy logical," he said.
Nokia is looking for new revenue sources as the cellphone industry matures and has said it sees maps as a cornerstone of its new Internet services strategy.
"The personal navigation devices we see today are not the basis for a long-term strategy. We are about connected devices. I think PND-mobile lines will blur," Halbherr said. "Navigation is a technology, not a device."
Halbherr declined to say how long it would take to produce a device for pedestrians after the Navteq acquisition, and admitted it would be a complicated task.
"It's the locating technology and it's the map attributes -- these need to include more precise data. For example, you want to know the exact entrances to the subway station. For a pedestrian, a distance of 50 or 60 meters is a big issue."
"People want to know where they are when they walk. When they drive, they don't care that much. We just have to figure when the experience is ready for the user," he said. "There's clearly a lot of work ahead of us."
Halbherr was previously chief executive of Gate5, a German provider of location, routing and navigation software that Nokia bought last year in its first move into the navigation industry.
Nokia started to offer free maps and routing data in February while charging extra fees for navigation.
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"It's not really our intention to take market share away. It's our intention to grow the market," Michael Halbherr, the head of Nokia's location-based activities, said on Thursday.
"We want to take the intelligent mapping experience to the pedestrian," he told the Morgan Stanley Technology, Media and Telecoms conference in Barcelona.
Nokia's agreed bid for digital mapmaker Navteq, the biggest in its history, cast a spotlight on the fast-growing navigation industry and was quickly followed by a bidding war for Tele Atlas (TA.AS: Quote, Profile, Research), Navteq's only global rival in mapmaking.
TomTom (TOM2.AS: Quote, Profile, Research), currently the highest bidder for Tele Atlas with an offer valuing it at 2.9 billion euros ($4.2 billion), said it would remain focused on car navigation but Tele Atlas would likely still supply handset makers.
TomTom Chief Executive Harold Goddijn said it was unclear how Nokia's entry into the market would change the competitive landscape but said it removed the worry that Tele Atlas customers might switch to another independent mapmaker.
Nokia's Halbherr said Nokia's aim was to bring detailed maps for pedestrians to the hundreds of millions of Nokia phone users worldwide, enlisting the help of those same customers to keep its maps up to date.
"Mapping will go to the next level. That's one of the things where communities can help," Halbherr said. "We have the world's biggest media-capture device. It means people can capture content, put it on the map and share it with others."
Halbherr said owning a mapmaker meant Nokia would be able to direct its own strategy in areas previously of little interest to a car-focused industry.
"With a map supplier in house, we can have long-term basic planning and can invest aggressively in places like India, where they didn't necessarily see a market," he said.
"Historically, map suppliers go to the high-end car segment. We can change that. There's a whole set of advantages that make this buy logical," he said.
Nokia is looking for new revenue sources as the cellphone industry matures and has said it sees maps as a cornerstone of its new Internet services strategy.
"The personal navigation devices we see today are not the basis for a long-term strategy. We are about connected devices. I think PND-mobile lines will blur," Halbherr said. "Navigation is a technology, not a device."
Halbherr declined to say how long it would take to produce a device for pedestrians after the Navteq acquisition, and admitted it would be a complicated task.
"It's the locating technology and it's the map attributes -- these need to include more precise data. For example, you want to know the exact entrances to the subway station. For a pedestrian, a distance of 50 or 60 meters is a big issue."
"People want to know where they are when they walk. When they drive, they don't care that much. We just have to figure when the experience is ready for the user," he said. "There's clearly a lot of work ahead of us."
Halbherr was previously chief executive of Gate5, a German provider of location, routing and navigation software that Nokia bought last year in its first move into the navigation industry.
Nokia started to offer free maps and routing data in February while charging extra fees for navigation.
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