Just like GPRO through the roof then floor fell out but then again you never no Stock Market crazy mind of its own
We are quickly approaching a pivotal moment in Apple's history as technology and mobile are on a collision course with the automobile.
The themes we see playing out over the next 10 years in the automobile industry will serve as the foundation for the next 100 years of personal transport.
This likely means that Apple has no choice but to enter the automobile industry.We are quickly approaching a pivotal moment in Apple's (NASDAQ:AAPL) history as technology and mobile are on a collision course with the automobile. While most would conclude Elon Musk's Tesla (NASDAQ:TSLA) and a few of the strongest automakers are the leading contenders of this new automobile era, Apple and Uber are the two companies best positioned to rule the new era of the automobile.The Auto Industry Is Ripe for Change
Timing is everything. A few years too early and even the best product will fail to catch on with the consumer, while a few years too late and the best product will likely have already shipped. We are quickly moving towards a period where the auto industry is positioned for change.
Many are still not convinced Apple will enter the automobile industry because of doubt Apple can come up with a product that leapfrogs the best-ranked vehicle on the road today: Tesla's Model S. The problem with that thinking is that "better," when thinking about the future automobile, won't be defined by performance such as battery range, speed or acceleration. Instead, the primary innovation that will hit the auto industry will be shifting dynamics in which power moves from traditional auto manufacturers and car dealerships to technology companies that empower the consumer. Convenience and personalization will outweigh traditional performance metrics.To rethink the automobile, one has to attack the current industry structure. Apple has had prior success with rethinking the way industries operate. The iPod, despite a revolutionary input method, did not become a mass-market success until Apple convinced the music industry to move to a $0.99 per song download model for long-term survival. The iPhone's biggest innovation may have been shifting the balance of power in the mobile phone industry from the carriers to Apple, something few analysts and pundits thought was possible. At the end of the day, Apple was able to position its products as the catalysts of change. This same type of "breakthrough" moment will occur in the automobile industry. Owning the manufacturing infrastructure capable of producing millions of cars will shift from a source of power to a liability. Instead, the power in the automobile industry will be found by the company owning the mobile ecosystem that empowers the consumer.
While many think Tesla is pushing the envelope in terms of altering the automobile industry, a closer analysis would reveal that Tesla is actually largely residing within the same structure, facing identical limitations to any other automaker, especially in terms of capital requirements and growth. Instead, companies like Uber are not only positioned to wreck havoc in the auto industry, but they are already causing much change. Uber isn't just a ridesharing app, but an aggregated demand phenomenon. Said another way, Uber is using the smartphone to match demand and supply for automobiles efficiently and cheaply. Uber is not alone as Lyft, its closest competitor, has seen some levels of success as well.Many assume Uber will be the best taxi service in the world, but there are more important underlying trends taking place in the auto market. The automobile's value proposition is changing and few current automakers will be able to respond and remain relevant. Apple's ability to build experiences around style and a thriving ecosystem and Uber's ability to shift power back to the consumer represent the changes that will shake up the auto market the most since the Model T's introduction in the early 1900s.
Using the Model T to Determine the Future
Henry Ford had a very simple goal with the Model T: set the world free. Up to then, personal transportation was for the rich and privileged, which severely limited society's potential. The Model T was cheap, reliable, and utilitarian. These attributes were seen just by looking at the vehicle and its high-quality parts and high ground clearance to navigate a world with very few paved roads. Ford (NYSE:F) sold the Model T for the equivalent of what is around $5,000-$10,000 in today's dollars (the average price for a new car today is $33,000), a byproduct of pricing the automobile low to stoke demand, thereby making it cheaper to produce through economies of scale.At the high point in 1923, Ford was selling 2 million Model Ts a year, representing approximately 50% of the vehicles on the road. The automobile was a tool for getting from Point A to Point B. Ford nailed the value proposition, and it seemed that the future was in his hands. However, there was one thing that he did not expect to happen.
Chevrolet introduced something that ultimately marked the end of Ford's dominance: different car styles. The automobile moved beyond just a utilitarian vehicle as people were buying new automobiles according to how they looked. Over the next 80 years this trend has only intensified. We now have an auto industry hungry for sales, segmenting the market according to not just style, but also performance and price. We went from a world where one model accounted for a majority of the cars on the road to one where buyers can spend months finding cars that best suit them.Changing Value Proposition
The primary reason technology will alter the the automobile industry's power structure is that the automobile's value proposition will shift. We already see signs of this shift taking shape. The New York Times highlighted how teenagers can't wait until they turn 16 so that can have their own Uber. The way we value the automobile is changing. People who have never owned or driven a car may indeed hold the purest form of vehicles: tools to get us from Point A to Point B. Car ownership has likely corrupted those that have a car in the driveway, leading us to ignore the negatives and instead focus on the "positives" such as having a car at our disposal. Uber is beginning to expose those "positives" as thin attempts at finding purpose behind a large monthly expenditure.
There are outliers to this dynamic, such as high-end performance cars, but they aren't for the masses and don't represent the overall trend that is occurring across the world.
We are soon entering a period where a car's primary value will resemble that of the Model T, utility. People are once again starting to look at cars as devices that move them from Point A to Point B. However, technology has made it possible to improve on Ford's concept. The smartphone and software will make it possible to position convenience and personalization as the primary value attributes of personal transport.Convenience
Uber is currently at the forefront of offering convenient personal transport. Using a smartphone (or Watch) to indicate demand for an automobile and then track the approaching vehicle on a map in real-time goes a long way in turning the vehicle into a commodity. Uber begins to question whether car ownership is the most convenient way of getting from Point A to Point B. The frustration with parking, maintenance, and the actual act of driving has its limitations.
This is bad news for automakers as the idea of ridesharing causes consumers to think beyond factors and attributes that automakers have spent decades building and marketing as reasons to buy their product. This shock to the system has similarities to the cell phone market when the iPhone altered what people expect and want out of a smartphone. One can now make the argument that the same thing is happening in the luxury watch market following the launch of Apple Watch. I'm convinced many other industries will follow a similar path as technology and software upend the status quo.
PersonalizationThere is one thing that Apple has the potential to excel at with an automobile: using hardware, software and services to personalize the driving experience. The ability to have the driver and passenger compartment adapt to one's lifestyle and personality is something that the world has never seen or even thought about.
Every subsequent technological breakthrough found in an Apple product has included a move towards becoming more personal. That trend will continue with the automobile.
Having a car be able to adapt to whoever is sitting in it, which makes more sense in a world where car ownership is on the decline, will be one of the most revolutionary developments the automobile has ever experienced. We are used to a certain level of customization in automobiles such as different seat positions, but personalization will add much more in the way of software to customization to produce an entirely new experience. A family with four kids and luggage has different needs than a commuter headed to work. Having a car that can adapt to both of these users in terms of seating, amenities, and not to mention technological needs and luxuries will be much more important than having a car that has fast acceleration or longer driving range.Succeeding in Land of Disdain
If Uber's success and popularity aren't enough evidence that the world is ready for a new way of personal transport, consider the complete destruction of car culture in the U.S., where most of today's car loyalists still look at the 1950s and 1960s as the pinnacle of car fandom. Today people buy vehicles because they need to. There is now a certain level of disdain in the automobile buying market.
I have little confidence that the current fleet of automakers will be able to compete in an industry built on a different value proposition. Companies born in a mobile era such as Uber and Lyft are best positioned because they can extract value from a sea of commodity, where all of the cars are the same in and out. Mobile companies wouldn't be limited by car manufacturing which will represent a ball and chain. This is the primary reason why I fear Tesla, a pioneer in electric vehicles, may remain a pioneer because of its manufacturing facility.Apple. The company that excels at selling experiences will rely on pages from previous playbooks with the automobile. Design will play a crucial element of any product from Apple with Jony Ive, Marc Newson, and the industrial design team playing a role in every piece that goes into the vehicle. Apple will rely on third-party contract manufacturers to assemble the actual electric vehicle. Mapping and other telemetrics will combine with a revolutionary personalization system to position the car to handle additional autonomous features including accident avoidance. I haven't even mentioned the innovation in terms of materials. In a sea of commodity, Apple knows how to build a pretty cool-looking vessel.
Uber. While a network effect has given Uber an increasingly valuable proposition for drivers (and users), I would expect the company to continue moving towards controlling key technologies that play a role in the Uber experience, such as mapping technology and navigation. The risk for Uber is being locked out of smartphones or operating systems in the future, the same fears held by Amazon and Facebook. This dynamic is made that much more interesting in an era where the entire automobile will controlled by an operating system. Uber's response may include eventually producing the entire automobile, relying on strong cash flow from ride-sharing to contract with a third-party to produce pretty generic commoditized vehicles.
Why Not Tesla?Tesla's approach is largely confined within a legacy industry which represents its biggest challenge. While Tesla clearly has a lead in terms of software compared to other automakers, there are doubts that the company has enough resources to truly move beyond just performance-based metrics and begin to create an overall personal transportation experience.
Self-Driving Cars and Car Ownership
The automobile's value proposition will change regardless of self-driving cars. While there is strong evidence that truly autonomous cars are still many years off, the much more important aspect is that convenience and personalization (the new value drivers for the automobile industry) can be achieved in stages. A growing number of people already consider Uber as more convenient than owning a car, and this is in a world with no autonomous cars.
If self-driving cars do become a reality, then car ownership trends and the overall auto industry and will undergo such change in short order, it is difficult to truly conceptualize how many existing companies will lose relevancy overnight.What About CarPlay?
Many people still think Apple's primary ambitions in the automobile industry are related to an expanded CarPlay where our iPhones will sync with a car's dashboard and infotainment system. On the surface, that plan sounds a lot easier than rethinking the entire car. However, there are several issues that are not being addressed. Putting CarPlay in a car not built by Apple is the equivalent of Apple putting iTunes on a Motorola phone in 2004. There are fundamental issues with not controlling the entire experience as the car manufacturer has a different value proposition than Apple.
Car manufacturers have not shown any willingness to lose major aspects of their vehicles dashboards and diagnostics to technology companies. Much of this is moot anyways because the overall auto industry structure is not altered one bit by just controlling the dashboard. To truly change the world, which is the only thing Apple would be focused on doing by entering the automobile, they need to embrace convenience and personalization and alter the way value is extracted from the automobile industry. That is only possible by owning the entire automobile including contracting out manufacturing to a third-party and owning the retail distribution.The Next 10 Years Will Determine the Next 100 Years
The themes we see playing out over the next 10 years in the automobile industry will serve as the foundation for the next 100 years of personal transport. This likely means that Apple has no choice but to enter the automobile industry. The change that the auto market will undergo will have a number of important implications including the way cities are laid out, how we function as society, and how the car is just the beginning of how technology can impact our lives. Simply put, having technology companies control personal transport will be the start of controlling the home and other large portions of our lives.
Nokia is looking for a buyer for its HERE Maps software, we have heard that a wide range of companies are interested on getting their hands on Nokia’s mapping software.
Interested companies include the likes of Uber, a consortium of German car makers which includes Audi, BMW and Mercedes, there have also been rumors of Facebook and Apple showing an interest.
Now according to a recent report by Bloomberg, Microsoft, who previously bought Nokia’s mobile business, is interested in buying a minority share of HERE Maps.
We previously heard that Uber had bid around $3 billion for the mapping software and now according to Bloomberg, the company could be sold for as much as $4 billion.
It will be interesting to find out which company or group of companies manages to get their hands on Nokias’ HERE Maps.
Windows Phone users will understand the difficulty of choosing between Microsoft’s Bing Maps and Nokia’s HERE Maps when they need to use a good GPS app. While HERE Maps is a great app on its own, Microsoft’s alternative is still based on the HERE technology.
Microsoft first attempted to buy Nokia’s HERE Maps along with the big Nokia deal, but it was too expensive at that time. The Windows maker eventually ended up licensing the HERE technology and integrating it into its Bing Maps.
As time passed, its value went down and compared to the $8.1 billion acquisition Nokia made to buy out Navteq Corp back in 2008, HERE Maps is now estimated at a value of $2.1 billion.
Nokia is said to have reached out to Uber and other companies in hopes to sell its technology and focus on its wireless networking business. However, the more the latter companies and the Redmond giant ponder on what to do, the more opportunity they give other big name companies such as Apple or Google to strike a deal first. Why might they be interested you say? It’s simple.
The HERE technology is significant due to its availability on all major smartphone platforms. Given that Microsoft has previously showed interest into making a profit off the more popular smartphone markets with its own products, it would be wise for it to swoop in and make a deal ahead of everyone else.
Microsoft did not make any official statement regarding its intentions to buy the HERE technology just yet. But truth be told, it would be a shock to see the technology in the hands of some other company since Microsoft’s Bing Maps relies heavily on HERE’s data.
For many of the largest Silicon Valley technology companies, location software undergirds numerous applications and features in their products.
For Apple, it has been a game of catch-up.
To that end, Apple confirmed on Sunday that it had purchased Coherent Navigation, a Bay Area global positioning company, further bolstering Apple's location technology and services.
"Apple buys smaller technology companies from time to time, and we generally do not discuss our purpose or plans," the company said in an email.Founded in 2008, Coherent Navigation was a small firm that focused on creating commercial navigation services based on partnerships with companies like Boeing and Iridium, the satellite network operator, according to a description on the LinkedIn page of Paul Lego, the company's former chief executive.
Since its start, the importance of its technology has only grown.Coherent Navigation worked on high-precision navigation systems, technology that is far stronger than many consumer-grade global positioning systems, which are typically accurate to within three to five meters. In the past, Coherent Navigation has also worked on autonomous navigation and robotics projects, according to previous company job listings, as well as projects for the Defense Department.
It is unclear exactly how Apple will use the company's services or technology, or if the company will incorporate its prior work into Apple's current products.
Terms of Apple's acquisition of Coherent Navigation were not disclosed.The acquisition, which was first reported by the technology site MacRumors, is another in a string of location technology service acquisitions made by Apple over the past six years. The purchase of Placebase, a small mapping service, in 2009 represented Apple's transition to building its own mapping technology. Over the following years, Apple bought a string of companies in much the same vein, including Locationary and Hopstop.Many of these acquisitions were part of a broader strategy to move away from reliance on Google Maps, Google 's widely used navigation service. In 2012, Apple released its own mapping service using in-house technology as well as some licensed from TomTom, a Dutch digital mapping company. That replaced Apple's old mapping application, which was based on Google Maps.
Competition for location-based services has been intensifying, as some of Silicon Valley's largest tech companies vie for more control over such technologies.
In February, Uber, the ride-hailing start-up, announced it had opened an institute for autonomous car research in Pittsburgh, where the company will work with the National Robotics Engineering Center and fund a series of robotics fellowships and professorships in partnership with Carnegie Mellon University.
More recently, a coalition of German automakers has been competing with Uber to acquire Nokia Here, the digital mapping arm of Nokia, the Finnish technology company. If Uber is successful, the move will help lessen its reliance on Google's mapping service, which currently underlies a significant part of Uber's navigation technology.
German car companies may need help to compete with a wealthy field of bidders for Nokia's high-tech mapping unit HERE, as the entry of technology company Uber into the fray signals interest from deep-pocketed Silicon Valley players, bankers and executives close to the deal said.
German automakers Daimler — the company that owns Mercedes-Benz — BMW, and Volkswagen's premium car division, Audi, have clubbed together to submit an indicative bid as a consortium, two sources close to the auto companies told Reuters.
The German carmakers can probably justify stumping up around $785 million (700 million euros) each to match HERE's book value, but could be easily outbid by technology companies who enjoy higher valuation multiples and have more cash.
Some investment bankers said they hoped private equity could join up with the automotive companies to create an industrial consortium that would not be dominated by one particular company.Taxi service Uber has submitted a bid, worth $3 billion, the New York Times reported, citing people with knowledge of the offer.
At such a price, Nokia could afford to keep a stake in the business it bought for $8.1 billion in 2007 and now values at 2 billion euros in its books and still realize a gain, one banker told Reuters.
The companies declined to comment.
High-definition mapping has emerged as a key feature for autonomous driving and connected car services, which could evolve into a $50 billion market, analysts at Exane BNP Paribas say.
HERE's high-quality maps enable automakers to offer premium services that Google maps cannot match.
For example, their maps can be linked to a mobile phone signal in a way that allows parents to see exactly on which side of the school their children are waiting to be picked up — and the car can route the navigation system accordingly.
If you are one of those few who are actively using mobile map of Facebook Inc. (NASDAQ:FB), you might be wondering how Facebook Map for mobile web version has suddenly become more (or less) accurate! It is because Facebook has started sourcing its location data from soon-to-be-sold Nokia’s HERE map. The social networking giant has silently inked a deal with Nokia to leverage on its massive database build by the company in the last two decades.
Once the leader of mobile industry, Nokia is considering to sell its map division soon and many companies, including Apple, Samsung, Amazon, Baidu and of course Facebook, have set an eye on the Nokia HERE. While the deal is expected to fetch at least $2 billion for Nokia, many industry analysts feel that it could swell up to $3.5 billion, considering the massive database and expertise Nokia has in the field of location mapping service.
However, by integrating location data of HERE, apparently, Facebook has taken a lead. People close to Nokia Map division feel that Facebook is the best option for Nokia HERE as the social networking giant has got a massive user base of 1.44 billion, and nearly 1.1 billion users are on mobile.
When TechCrunch contacted Facebook about the development, the company’s spokesperson confirmed, “We are testing Nokia HERE maps across Facebook to give us more control and flexibility in delivering a consistent maps experience. I can confirm that we’re testing HERE maps in Android versions of some of our standalone apps like Instagram and Messenger as well.”Location Based Services: Next Big Thing
So, why is Facebook betting big on Nokia HERE ? The answer cold be segregated in two parts:
Photos are the more popular type of content on Facebook. A little over 250 billion photos are uploaded on Facebook by now. Daily, 1.44 billion users are uploading 350 million new photos on the world’s most popular online social network. Interestingly, due to the emergence of location-based apps, most of the smartphone users are keeping their GPS location on and a majority of these photos are auto-tagged with users’ location. Nearly 17 billion Facebook posts are tagged with a location.
Therefore, if Facebook has to make further enhancement in users’ experience, it would look to nothing but the Photo uploading feature to start with.
The second aspect is directly linked with the company’s revenue model. 40 million brands have created a page on Facebook, but only 5% of these spend on Facebook advertisement. Rest 95% are still relying on the organic reach of Facebook, which is nearly dead now after the latest three major changes. Mark Zuckerberg and team are constantly introducing new features to Facebook page owners to lure brands and convince them spend at least a small share of their online advertising budget on Facebook.For brands Photos are the important content when it comes to advertise on Facebook. Photos account for 62 percent of all brand posts but create 77% engagement. If Facebook could provide more precise location data, brands could opt for a better-targeted marketing approach, resulting in a greater ROI.
Facebook-Nokia HERE Acquisition Has A Challenge Too
Facebook, however, is yet to integrate HERE map data with native apps on iOS and Android platform. The existing Facebook app is still powered with Apple iOS map or Google Map. But, on the mobile website, location data is being derived from Nokia HERE.
By taking a step forward and integrating location data from Nokia HERE, Facebook has surprised many, especially when the possibility of acquiring HERE by some other company can’t be ruled out. However, people close to the matter believe that Facebook is almost sold on Nokia’s HERE. Therefore, the company has started testing the service by integrating it on the platform. The development will help Facebook to analyze the real capabilities of HERE and integration challenges that would have occurred post-acquisition. If things go as expected by Facebook, the social networking giant could go the extra mile to acquire Nokia HERE division.
On the other hand, Facebook is caught in a situation where it could face a blow if some other giant, say Apple or Samsung, makes a higher bid and buys Nokia HERE to strengthen its position in the location based services offerings. Facebook would be left with no other option but to negotiate wit the new owner of Nokia HERE to use the service on a licensed model; And, that too, if the new owner of Nokia HERE agrees to expose the location data.
13 MINUTES AGO
Nokia is close to buying Alcatel Lucent's wireless business to compete better with Ericsson, reports Bloomberg. This is the independent Nokia that sells telecommunications equipment; Microsoft bought Nokia's well-known wireless phone business in 2013.
Nokia Oyj is in advanced negotiations to acquire part of Alcatel-Lucent SA to strengthen its telecommunications-equipment business and better compete with Ericsson AB, according to people familiar with the matter.
Espoo, Finland-based Nokia may announce an agreement to buy Alcatel’s wireless assets as early as this week, the people said, asking not to be identified because the discussions are private. While a full takeover of Alcatel has been examined, a purchase of the wireless business remains the most likely scenario, the people said. The unit had 2014 revenue of 4.7 billion euros ($5 billion). No agreement has been reached and a deal could still fall apart, they said.Nokia executives are seeking to secure French state backing for a sale of the Paris-based company’s assets, said one of the people. Any deal would need a green light from President Francois Hollande’s government, which had previously tried to block corporate mergers in the country. Representatives of the French government are working with advisers on a transaction that would protect some domestic research jobs, the people said.
Representatives for Nokia and Alcatel declined to comment on the talks, which were reported by Les Echos today.
Shares of Nokia and Alcatel jumped for a second day after Bloomberg News reported on Friday that Nokia is exploring a sale of its maps business known as HERE. Bids are expected soon for the unit, which is valued by Nokia at about 2 billion euros and has attracted interest from companies and private-equity firms, people familiar with the matter said last week.
Since Nokia sold its phone business to Microsoft just on a year ago, they’ve been focussing on developing the remaining parts of the business that have a chance at profitability. One of those units is their mapping business.
A report by Bloomberg suggests that Here, the name given to Nokia’s maps business unit, is up for sale with Recode speculating that Apple should look to buy one of the few jewels remaining in the Swedish company’s crown.
Our own experience has been Apple Maps works pretty well most of the time. However, there have been some annoying features. For example, if navigating to a location that has an incomplete address in Contacts, we end up in a central location in the suburb near the actual place we’re navigating to. Also, there are times when it simply can’t find known addresses.
In other words, from our experience, Apple Maps needs some work. In contrast, we don’t have the same level of annoyance with Google Maps that does a better job of finding places. But we end up using Apple Maps more as it’s so tightly integrated into other iOS apps such as Calendar.
When Apple Maps was launched to great fanfare, Apple had to do some quick back pedalling as the service offered some “creative” navigational advice. The issues were so serious that Apple’s CEO Tim Cook issued a very rare apology that went as far as recommending other apps instead of Maps.
While those days are behind us, it’s clear that Apple could do worse than take some of the $180B they have in the bank and buy Nokia’s maps division in order to bolster their own software.
Will Apple go ahead and buy Nokia’s map division, if it is on the market? No one outside Apple really knows the answer but Apple’s track record in buying other companies tends to be around the acquisition of strategic technologies. However, the recent purchase of Beats was about making a tactical play to respond to shifting consumer behaviour away from purchased music towards subscription streaming services.
The potential purchase of Nokia’s maps division would be a similar tactical move. It would help fix some of the shortcomings Apple Maps suffers from.
According to Reuters, Nokia (NYSE:NOK) is considering selling its map business, also known as HERE that is valued at $2bn. The valuation is above that of AutoNavi, which was bought out by Alibaba (NYSE:BABA) for $1.5b and below that of public-traded NavInfo, which currently has a market cap of $4.5b. Recall that map was an integral part of Nokia's handset business. Given that the handset business has been sold to Microsoft (NASDAQ:MSFT), the map business has little value to Nokia so it makes sense to sell the unit to a willing bidder. The cash from the proceeds can be used to reinvest in Nokia's existing business or return them to the shareholders. I expect shares of Nokia to continue to climb higher heading into the sale. HERE could attract willing bidders, particularly internet companies that are looking to build their location-based platform and map is a critical part of the equation.Among the internet companies, I believe Apple (NASDAQ:AAPL) could become a potential bidder. Having relied on TomTom for its map content for years, it makes sense for AAPL to acquire Nokia's map business to vertically integrate its map services. In the long term, this strategy is consistent with AAPL's development of iBeacon and other LBS features by leveraging third party data (i.e. travel, restaurants, entertainment). However, such move could potentially become burdensome given the amount invested by AAPL on building on top of the TomTom platform. Switching cost for AAPL could be high and initial technical challenges with the map could result in migration of users from AAPL map to Google map. On the flipside, total ownership of map content and services is accretive to AAPL's long-term growth and lessens its reliance on third party map provider.Tencent (OTCPK:TCEHY) and Xiaomi could potentially be bidders from Asia. Amongst the Chinese internet giants (i.e. Baidu, Alibaba and Tencent), Tencent is the only company that does not have its own proprietary map service. Baidu sources its map content from NavInfo and I do not see any change to the status quo given the leverage Baidu has over NavInfo. Alibaba, on the other hand, has Autonavi so it makes little sense to make further acquisition in the mapping space. Tencent is the only one without its own map. While Tencent has deeply penetrated consumers' mobile ecosystem through WeChat, the company still needs its own proprietary map content to develop its own O2O and LBS features. Simply relying on WeChat may not be enough.
Xiaomi could potentially be another bidder for Nokia's map given that it currently does not have its own map, or any map, installed in its handsets. Map is increasingly important to mobile focused companies whether it is a smartphone maker or an internet company. Xiaomi's acquisition of Nokia allows it to build up its map services and potentially diversify its revenue to O2O, LBS or even location-based advertising given its massive user base. When looking at the investment Google put into its own map and how AAPL decided to create its own map service post the iPhone launch, it is evident that large global tech firms are placing a particular attention to mobile maps, making NOK an attractive target.Conclusion
I would long NOK, AAPL and Tencent. Any acquisition of NOK's map business could become a catalyst for the stock.
Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.
Finnish telecom equipment maker Nokia has identified a “serious” buyer for its manufacturing plant in Chennai, a top Tamil Nadu government official said on Friday.
“Nokia has been telling us that they have identified a very serious buyer, but due to their non-disclosure agreement they are not willing to give out their name,” Tamil Nadu Additional Chief Secretary C.V. Shankar told reporters here.
The plant started operations in 2006 near Chennai, but was shut down in November last year.
Nokia, which sold its global devices and services business to Microsoft in April last year, left the manufacturing plant out of the deal due to ongoing tax issues faced by the Finnish firm in India.
“Essar Chief Ruia (Shashikant Ruia) was in Chennai and he also mentioned that he has looked at the plant but he has not committed saying yes or no. So we really do not know who the prospective buyer is,” Mr. Shankar added.
On the tax cases being faced by Nokia, he said it is an individual company's case with the Income Tax department.
"Obviously the state government cannot say yes or no to any of them at the particular issue in hand. Nokia has now come up with a proposal for defreezing the assets and selling it to someone outside the company and the money to be parked in an escrow account etc.
“We have said this is a good thing to happen and Prime Minister has made a statement in Rajya Sabha on this. So once it is opened then some other company can come. The employment would start,” he added.
Mr. Shankar said it would be in everyone's interest if the factory is started.
“To that extent, going into the issue, merit of the case or otherwise, we would prefer that unit is open. GOI should take a call on this very quickly,” he said.
When asked if the Tamil Nadu government has not been supportive of the firm, Mr. Shankar said the government had always been supportive of Nokia.
“In fact, in 2012 we signed an MoU for an additional Rs. 250 crore and the land at that time was given at below market price. State has been fully behind them,” he added. - PTI
A report that Nokia could be putting its Here mapping unit up for sale should raise eyebrows at companies through the tech industry.
Bloomberg reports that Uber and private equity firms are among those who have been approached by Nokia. A Nokia representative was not immediately available for comment.
However, if the mapping unit is indeed for sale, it could draw interest from wide array of big-name tech firms. That’s because Nokia is the remaining big independent company in the global mapping business. Microsoft, Yahoo and Amazon all rely on its location technology, as do most of the major automakers.
Any of those players might be interested in trying to keep the technology from falling into the hands of a rival.
While Nokia’s maps are important to many companies, they aren’t necessarily something those companies would want to own. Nor is it a particularly great business, with Nokia getting most of its money from the car companies that license its mapping. Those payments are under pressure from readily available Web-based technologies like Google Maps. Nokia has been trying to rapidly evolve the maps from navigational aids to something that can be used by autonomous and semi-autonomous cars.
One company that could easily afford to buy the business — and might see a strategic benefit — is Apple. The company clearly has a need when it comes to better mapping data, and also is said to have more than a passing interest in the auto market. Another possibility is that some sort of coalition of parties with a vested interest in the map data could emerge, similar to the Rockstar patent consortium. But it’s easier to have a consortium own patents than it is to operate a business.
Microsoft, of course, already bought Nokia’s mobile phone business. That has left the company with three rather distinct and unrelated businesses — the mapping unit, a network equipment business, and a technology unit made up mainly of the company’s significant patent holdings.
In a new development, Nokia is now looking to sell its HERE maps business unit. Reuters reports that the company has hired a financial adviser, as it does not see much synergy in its map business after the sale its handset unit.
Nokia is looking to focus on its wireless network business, which amounts to 90 percent of revenue for the company and improving its debt rating. The current valuation of the map business is at about #$%$2 billion. Bloomberg reports that HERE made full-year sales of #$%$970 million and an operating loss of #$%$1.24 billion, including a goodwill impairment of #$%$1.21 billion. Nokia had bought Navteq for #$%$5.7 billion in 2007.
“We have estimated that HERE’s value is around #$%$3.3-4.8 billion, and in a possible deal the price should be more than that,” Inderes Equity Research said on its Twitter account.
Nokia is reported to have approached cab service company Uber and other private equity firms. A group of German carmakers have also shown interest. Bids for the HERE maps unit are expected to come in by the end of April.
If the sale goes through, Nokia will look to grow its network business, and even consider buying rival company Alcatel-Lucent SA. The HERE maps business currently provides services to Amazon, Microsoft, Yahoo and several car-navigation systems.
After the sale of its handset unit, Nokia has three businesses left – the map business, the network business and an R&D unit which licenses all its patents.
Amount was not disclosed.I came across an article last year that said if Nokia map goes on IOS and Android then Microsoft would be forced to purchase HERE MAP.
In short order, the sale of Nokia’s mobile phone division to Microsoft will be official. What’s left of the Finnish company is basically two businesses: One that provides mobile network infrastructure and one that provides mapping services, called Here. Apple should pay Nokia whatever it takes to acquire the latter. If the Microsoft deal is a proxy, Here, which did about 900 million euro in revenue last year, could be had for half a billion or so. If Nokia plays hardball, Apple should be prepared to pay several times that. The price is insignificant; the strategic value is fundamental. And so is the timing. With Apple’s announcement of CarPlay this week — it’s iPhone-automobile integration solution — having better maps has become more critical than ever. With the decks about to clear at Nokia, there’ll never be a better time to buy Here, probably the best mapping asset out there.After a disastrous launch of its own maps in September of 2012 which led CEO Tim Cook to apologize, the built-in Apple product has gotten a lot better. While it will generally get you where you need to go, though, it still has issues with picking the best route and with sometimes finding the right location from the search bar or Siri. There are a number of reasons why, but chief among them is that Apple simply doesn’t have the breadth of data Google does. The search giant collects an obscene amount of information through numerous techniques including its fleet of Street View vehicles. At the time Apple launched its competitor, Google had more than 7,000 people working on its own maps, according to Business Insider.Apple, for its part, has relied on data pulled from multiple sources, like TomTom, the maker of navigation devices that were much more popular before smartphones caught on. It also was using data from Waze, which has since been acquired by Google for $966 million, so it’s not clear if that relationship continues. (Waze is terrific, but Apple should really be willing to pay at least twice as much for Here, which has much richer assets.) Apple has acquired at least four firms in its efforts to beef up Apple maps, including HopStop and Embark to improve the transit part of maps, as well as Locationary and BroadMap. What it hasn’t done thus far is acquire its own version of a human army anywhere near the size of Google’s that can process reports that come in, correct errors, and generally make Apple’s maps the best in the world.That’s where Here comes in. The division had 5,741 employees at the end of Nokia’s fiscal year. Though it did #$%$914 million in revenues, it lost money for Nokia. Without Here, the post-phone Nokia will be a profitable, nearly pure play that could likely dividend a bunch of cash to its shareholders. There’s a good chance the Nokia board would be interesting in selling for the right price.
Apple, for its part, would probably have to do things a bit differently than it normally does in acquisitions. Here has a lot of customers and it wouldn’t make sense to cut them off. What makes the data good is having lots of people use it so that it can be improved through a combination of passive techniques, crowdsourcing and active gathering using human beings (much as Google does). Here was installed in 10 million new cars in 2013, which is about 1/8 of all the cars sold last year. The company lists BMW and Toyota as customers on its website and included mentions of Honda, Nissan and Mercedes-Benz among its financial highlights. All are among Apple’s partners for CarPlay. Garmin is also a customer for whatever remains of the standalone navigation business.And, of course, there’s Nokia’s phone division, which will become part of Microsoft. Former Microsoft CEO Steve Ballmer had grown weary of Apple and its success, but the new guy, Satya Nadella, might welcome Apple’s ownership of Here, or at least be indifferent to it. Microsoft has its own mapping product in Bing Maps, which uses data from Here. It’s also not as good as Google’s. If Apple owning Here and doubling down on Maps ultimately leads Microsoft to collaborate more closely with Cupertino on building at least one great competitor to Google, then really everyone wins.
As things currently stand, Google currently has the best maps out there, but they’re hardly perfect. In fact, having run a lot of back-and-forth tests lately, I’m finding the user experience of Apple’s navigation better than Google’s, even with the inferior data. But that data means Apple can’t claim it has the best maps product powering what it can otherwise claim is still the best overall smartphone experience. It’s been about 18 months since it got into the game. Now is the time for it to gather a key chip to up that game.
Nokia Oyj is exploring the sale of its maps business as the Finnish equipment maker focuses on boosting growth at its wireless-network unit and improving its debt rating, according to people familiar with the matter.
Nokia’s maps business, which is known as HERE and competes with rivals such as Google Inc., is attracting interest from companies and private-equity firms, the people said, asking not to be identified because deliberations are private. Bids for the unit, which Nokia valued in its financial report at about 2 billion euros ($2.1 billion), are expected soon, they said.
The Finnish company, which is working with a financial adviser, may decide against a sale if it can’t get a price it deems sufficient, the people said. HERE reported full-year sales of 970 million euros and an operating loss of 1.24 billion euros, including a goodwill impairment of 1.21 billion euros, according to the annual report. In January, Nokia projected rising sales for its maps and patents divisions for 2015.Chief Executive Officer Rajeev Suri is seeking to reduce the company’s debt and boost its rating from junk status. Nokia’s digital-map business provides data to Amazon.com Inc., Microsoft Corp., Yahoo! Inc. and four out of five car-navigation systems.
A representative for Espoo, Finland-based Nokia declined to comment.
Last year, Nokia named Sean Fernback to head the maps business. Fernback, who joined Nokia from Dutch navigation-device maker TomTom NV, replaced Michael Halbherr, who left the company after disagreeing over the unit’s strategy with CEO Suri, people familiar with the matter said at the time. There was internal debate over whether the unit should focus on automotive and enterprise clients or also continue to target consumers, the people said.
Nokia has three businesses left after it sold its phone-unit to Microsoft for about $7.5 billion: the networks division, which makes up about 90 percent of total revenue, its maps business, and a research and development unit which is responsible for licensing its patents. In January the company reported fourth-quarter net income of 443 million euros, and sales that rose 9.4 percent to 3.8 billion euros.
Anyone looking to unload an Android or BlackBerry smartphone can now turn to Apple.
The company expanded its trade-in program on Monday to accept certain models of rival phones, including Android, BlackBerry and Windows Phone handsets. Your old phone scores you store credit, which you can then use to purchase a new iPhone 5c, iPhone 6 or iPhone 6 Plus, though not an Apple Watch, according to Apple news site 9to5Mac. The program is available in the US, UK, Canada, France, Germany and Italy.
Apple is constantly working to gain more traction over Android device makers, most notably Samsung. A report from market researcher Gartner this month showed that Apple inched past Samsung in worldwide smartphone sales in the fourth quarter.
Apple didn't formally announce the expansion of its trade-in plan, aka its Reuse and Recycling Program. But individual Apple Store pages now show the Reuse and Recycling Program section with the following line: "Get credit when you recycle your eligible iPhone, iPad, or select smartphone from another manufacturer."
The program also now accepts PCs from manufacturers other than Apple, allowing you to trade in your Windows computers for store credit that you can apply toward a Mac.
The new trade-ins are available at Apple retail stores. Are they also available online?
Apple has offered an online trade-in program through a third-party vendor called Brightstar. The Brightstar page for the UK shows several non-iPhone brands that you can trade in, including Samsung, Sony, Nokia, and BlackBerry. But the Brightstar page for the US still shows only iPhones as acceptable trade-in devices.
Similarly, the UK page for Apple's Reuse and Recycling Program says: "Get credit for your iPhone, iPad, or Mac, and eligible smartphones and PCs from other manufacturers. Depending on the device, take it to an Apple Retail Store or get started online." But the US page still displays only Apple devices as eligible for online trade-in.