Exploring Local
Mike Dobson of TeleMapics on Local Search and All Things Geospatial

More Winners In UGC and Geospatial

March 10th, 2008 by MDob

Let’s continue with our last post and examine more potential winners in the UGC derby. This time we will focus on: Online Mapping, Telecommunications and PNDs

Just to refresh your memory, a chart of the possible beneficiaries is here, while my handicapping of the entrants in the UGC derby can be found here.

Online Mapping

The players in this category provide routing and address finding for a variety of purposes, but the major uses they offer are formatted for applications involving personal navigation and Local Search. In other words, the predominant application functionalities are to “find places” and “find things”.

The “find places” requests target addresses for personal or business travel and are accompanied by a request to route between some origin and the queried location. The “find things” searches are usually requests to find businesses or services that provide a targeted buying opportunity for the searcher and a targeted selling opportunity for the returned listing (or other businesses in the category being searched).

The dichotomy described above is the reason that companies interested in mapping and Local Search are more concerned about knowing accurate business locations than are routing services, such as MapQuest. In essence, if Google relies just on the data provided by business listings providers it knows that it will not be able to successfully target or route users to all businesses or services due to errors in the business listing data.

Rather than disappoint customers with the quality of their locating and routing services, Google is compelled to ask users to help them update their map and business listings databases. To put it another way, if MapQuest blows a route because the end-location is not correct, it may lose a user. If Google blows a route due to a faulty location, it may lose a user (who helps drive its advertising revenue) and advertisers (who are the primary driver of the advertising revenue). Of course, we should note that the ads on MapQuest come from…Google. (Since MapQuest derives a revenue share from these ads, Google also wants to be sure that there are no errors in the geotargeting, so that it can retain the account by delivering more advertising revenue to MapQuest than can Google’s competitors.)

While Yahoo and Google allow the addition or editing of certain aspects of business listing by casual users, Microsoft appears to limit the contributors to business owners. Yahoo allows users to provide map updates by submitting information that is passed to their map suppliers. Microsoft may allow users to update map information, but I was unable to find a page that described the process. Google has taken a different approach. Not only does it have people in the field finding business (paying the researchers on a modified bounty-basis), but it allows its users to contribute changes to listing and maps. See this link for more details

While Yahoo and Microsoft are far ahead of Google in applying concepts of Social Networking to their mapping and Local Search applications, Google is far ahead of the industry in enlisting UGC to give its maps and business listings an edge over anyone else in the industry. Yep, they are the undisputed winners in this category.

Telecommunications

This one is pretty easy. Although some of the brands in this category are well known, none of the phone manufacturers have a customer-facing presence. You don’t buy your Motorola RAZR from Motorola; you buy it at Best Buy, Circuit City, a Verizon store or at a kiosk in Costco. So, the players in this market depend on distribution channels to connect with the market. Of course, all distribution channels eventually have to partner with a wireless network (Orange, Sprint, Verizon, etc.) to provide cellular service to the phone.

Hmmm. It sounds like applying UGC in this market might be difficult. Indeed, it will be and the only one with any real hope of using it to update maps is the telecommunications company that is attempting to acquire a map company (the EU will let us know about this on March 28th – or on that date tell Nokia that it has to go to stage 2 (and likely concessions) before the deal will be approved).

Let’s skip ahead and presume that the deal gets done. Nokia realizes that UGC can help it improve the “final-fifty-feet” aspect of Navteq’s database. In addition, it has done the math and knows that the need to begin to augment the Navteq databases for ADAS will require a lot of money to improve the positional aspects of the road data and add accurate elevation data (perhaps they should think Intermap).

If they are going to need to spend more money to augment the data from ADAS, I’ll bet they would like to use UGC on other parts of the data to decrease their compilation costs. The only real issue is how they do this when they are not in direct contact with the customer. Nokia’s use of UGC to benefit Navteq’s data presumes that it can work out a model with Verizon and other wireless carriers that somehow involves them in a beneficial manner. Possible solutions include royalty per-user or a reduction on the cost of a Nokia-based routing service that would be available to any network provider.

I think it is clear that Nokia will be the winner of the UGC derby in this market segment, but I am not sure how much of a benefit accrues to the winner. Not to say that I do not have some ideas about how to do this, but Nokia’s experience in capitalizing on its Gate5 acquisition does not provide a role-model for a chapter on how to manage a location-oriented business to success.

PNDs

And the winner is…TomTom. Once again, the cards are stacked. TomTom is a customer facing brand, it is attempting to acquire a mapping company and it already has the best application harnessing UGC on PNDs with MapShare. (I’ll bet you’d be glad to know that my TomTom 920 now has 16,386 Map Share map corrections in use – or so it tells me – and, in my opinion, it needs every one of those little buggers it can get!)

Unfortunately, UGC in the PND market looks like a one-horse race. To date, Garmin has not taken up the gauntlet and seems prepared to rest on its long-term contract with Navteq. In some ways you cannot argue with their approach since Navteq appears to have better data than TeleAtlas in many locations. I doubt that MapShare alone will be able to change this, but maybe the deployment of the advanced TeleAtlas vans and MapShare can be combined to provide a playing field advantageous to TeleAtlas?

One major, unplayed, UCG-related card in the PND markets is social networking. Properly implemented social networking flowing across WIFI equipped PNDs might allow PND companies to compete with Nokia in the future. At the present, however, it looks like neither Garmin nor TomTom may understand the potential marketing sachet and associated revenue benefit of adapting social networking constructs for geospatial applications.

And One More Thing

While editing this summary on UGC and map updating beneficiaries, it occurred to me that the real winners obviously are the companies who own map companies and are implementing UGC. Then there is Google. What’s it going to do with its large storehouse of UGC updated data? Is it sending the data back to infoUSA, Navteq and TeleAtlas? Is it going to give new meaning to “Edge Maps”? Or is it going to own a map company too – but maybe not through acquisition?

What do you think of that strategy? Some say they tried the concept and gave up on in it. Maybe it’s too soon to tell?
Hopefully we can talk about it at GPS-Wireless 2008 later this week.

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Posted in Data Sources, Garmin, Geospatial, Geotargeting, Google, Local Search, map updating, Mapping, Navteq, Nokia, Personal Navigation, TeleAtlas, TomTom, User Generated Content


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