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

TomTom’s Mobile Network Strategy

August 19th, 2008 by MDob

Last time we were speculating on how TomTom (and TeleAtlas) might deploy technology that would allow them to collect real-time routes. We described the potential advantages of capturing these types of data and indicated that this was the “end-game” of interest to both TomTom and Nokia.

Developing the infrastructure to collect these “path” data is a critical, limiting issue for the future of the industry. Today, we will describe possible strategies that would allow TomTom to accomplish this development. We will look at Nokia’s situation in a future blog.

Of related interest to this discussion is TomTom’s HD Traffic product, which is the public apparition of the endeavors of Applied Generics, a company acquired by TomTom in 2005. The service provides traffic guidance for primary and secondary roads based on collecting “anonymous” cell phone location information provided by Vodafone. Since the location of a cell phone is always known to the network (if the phone is “on”), calculating the speed and direction of movement of the phone (a surrogate for the vehicle) is easily accomplished. TomTom then merges these data with other traffic information and broadcasts the mix to specified TomTom devices (e.g. TomTom OneXL HDT or a device using the TomTom HD Traffic Receiver). The “qualified” TomTom device is equipped with a SIM card that allows direct communication from the TomTom Traffic Center to the PND. Although the service is currently available only in the Netherlands, the Company plans to expand the footprint of TomTom HD Traffic in the future.

So, leap forward and consider a similar TomTom unit, equipped with a SIM card that features two-way communication. A suitably provisioned device could communicate road geometry information back to the Traffic Center, allowing TomTom to mine these data to gain valuable information about paths, road geometry, and other travel characteristics.

Sounds good! Why don’t they have it today? Hmmmm. I suppose that lack of distribution is a major problem. Obviously, their pairing with Vodafone would seem to be accepting the obvious discrepancy between the number of users of PNDs and the number of users of cell phones. Vodafone has greater distribution and can provide the data feeds necessary to model traffic. Today, TomTom could not sell enough new units that were “path capable” to adequately model traffic in most urban areas. The distribution issue may suggest that TomTom will need to partner with a mobile network operator to provide the volume of location data needed to model traffic. At some point, however, TomTom may want to combine traffic and detailed path tracking. Who will be their partner then?

Next to be resolved, is the conundrum surrounding the estimated “value” of traffic and tracking to both TomTom and, then, to the user. My take is that TomTom needs to determine the potential savings in TeleAtlas compilation costs that can be generated by analyzing path data. In addition, they would need to mix in the value of the benefit that path tracking would add to the accuracy of their traffic data (more precise location, more coverage, especially in rural areas where cell towers are less dense and where reliable traffic information cannot now be provided). For TomTom the probable results are obvious, enticing and would lead one to believe that they will not alter the strategy they are now beginning to implement.

While improved traffic information and more accurate maps for navigation are certainly benefits to TomTom’s users, what are these users going to think about paying for traffic and road geometry that they created through their industrious endeavor? Today those Dutch citizens who use Vodafone are creating the data for the TomTom HD Traffic product, even if they are not the ones benefitting from tendering “their” movement information to the network. If we leap to the next stage, where detailed path tracking is enabled, then the public will be generating both the traffic and some of the map data used for navigation.

The issue here is that the user is subsidizing the system and receiving only secondary benefits. While services like Traffic HD are bundled into the device, the cost of the service inflates the price of the original purchase. In addition, services are usually provided for the first year or some other limited span. Once the user begins to pay “real” money for these services, will the data collecting serfs remain ambivalent concerning the value of their contribution to maintaining the product? Not likely, but possible, I suspect. A more likely scenario has TomTom offering a discounted rate for those users who will opt in to the collection process on an anonymous basis. So, what’s the user to do? Maybe the best solution is to buy stock in TomTom. Or maybe Nokia, or Google, or…?

Of course, our focus here is that TomTom is going to need access to a wireless network to enable their strategy. They could pair with Vodafone or another network operator, if they needed the anonymous cell phone traces to build a traffic-forecasting model. On the other hand, they could build a traffic and path tracking system based on analyzing the paths of users who report their data though their Internet hook-up with TomTom Home.* This, however, would result only in near-real time traffic and I am not sure this would be very satisfying to the person who was caught in an “anomalous” traffic jam. So, we can safely assume that TomTom needs to become, in some sense, a mobile communications network.

Let’s work through TomTom’s potential carrier relationship next time. Actually, we will need to talk about advertising too – that’s the real reason for TomTom’s strategic interest in mobile cellular networks.

* While conducting research for this article, I found the tidbit below on the TomTom website. I did not realize that TomTom collects information from the PNDs of their TomTom HOME users. The Policy (which is not in the user guide for the PND, but on the TomTom website) reads as follows: “TomTom may gather Anonymous Information from your TomTom device when you are using it or when you are connecting it to a computer by using TomTom HOME. This Anonymous Information may include information on how long it took you to travel certain routes, traffic patterns and on any technical glitches you may have encountered. The nature of the Anonymous Information that your TomTom device transmits to us will not enable us to trace it back to an identifiable person. We will only collect this Anonymous Information if you agree to provide it to us and you can always disable that such Anonymous Information will be provided to us by changing the settings of your TomTom HOME service.”

The actual tab on the TomTom Home site, which implements this action, reads as follows, “TomTom would like to gather anonymous statistical data to improve your map quality and navigation experience. We would retrieve this data whenever you connect your TomTom device to TomTom. It will not be noticeable, will not cost anything and will be completely anonymous. Setting this preference will allow us to retrieve this data.”

To be honest, I do not remember agreeing to set the switch to allow the anonymous transfer of my data, but I may have done so in the rush to install the package. However, I do remember unchecking this box a few minutes ago. Now, the only question is, “Does unchecking the box change anything?”

Until next time

Mike

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Posted in Geotargeting, Mapping, Nokia, Personal Navigation, TeleAtlas, TomTom, User Generated Content

2 Responses

  1. Matt McG

    Good question. How _would_ one know?

    As to the pricing the efforts of data collection
    serfs… maybe data suppliers avoid the advertising.

    Matt – There are a number of tradeoffs that could be negotiated. It will be interesting to see what happens.
    Thanks for your comment. MDob

  2. Fred

    TomTom has indeed been logging with their PND and collecting via TT Home very detailed trace-files. I remember an announcement about a year ago they collected over x Million trace files or something.

    (http://www.gpsreview.net/tomtom-iq-routes-for-older-devices/)
    “TomTom has taken that data collected over the past year or so, and created new average time estimates for the various road segments. That data was then built into the new map in the TomTom x30 series devices like the 730 and 930.”

    http://www.tomtom.com/legal/privacy/

    And they consumers seemed to be sleeping…..

    Thanks Fred, I had missed the announcement and appreciate your bringing it to my attention.

    Mike