How much is a map company worth?
The map industry has been shaken (or at least stirred) in recent months by announcement of two acquisitions totaling more than ten billion dollars!
In July, GPS maker TomTom announced an agreement to acquire Tele Atlas. Six weeks later, phone maker Nokia said it will buy NavTeq. Together, Tele Atlas and NavTeq supply most of the data for most in-car navigation systems, map web sites and software, as well as many publishers of street and road maps around the world.
Neither company publishes maps. Their business model is providing data to those that do publish, whether in electronic or print form. Through enormous investment that in past years has been considered risky by some, these companies turned the map industry on its head and may have turned some companies into the equivalent of the buggy whip manufacturers of the last century.
It's a classic business tale of the company that thinks they're in the whip business, when in fact they were in the transportation accessory business. Thus, when the new form of transport didn't require a whip, they went under.
Traditionally, map companies have collected map data, then published it, and then distributed it. In today's world it is possible to separate these three functions among two to three companies to achieve the end result. The business models are evolving and nobody, including the two companies that have pledged $10,000,000,000+, really knows how it will all shake out. But the bet is that services and information, rather than hardware, are where the largest profits will be.
The good news for consumers is that more maps can be accessed in more forms and places than ever before. The old-fashioned street map and road atlas are still with us. But you can also use a GPS to tell you how to get someplace without ever viewing a graphical map display.
As to National Geographic Maps, we continue to have a successful and growing business in the publication of printed wall maps and outdoor recreation maps. We have already been in the business of map software for some years. All of our maps are now generated from digital data. This puts us in a good position to take advantage of emerging technologies and the opportunities they present.
But even as we make more of our mapping available in digital media, we also believe that, at least for the kinds of maps we create, the printed form is a great user interface.
Update Oct. 31, 2007 >
GPS maker Garmin outbids TomTom for TeleAtlas