A Blog by Jonathan Low


Aug 30, 2013

Forget Tablets, Nokia Has a Bigger Connected Device in Mind: The Car

Nokia? They're still around? And some car maker might actually want to partner with them for something?

Well, as a matter of fact, Nokia has some chops to sell when it comes to automotive mapping. But that may be less important than the strategic conundrum that other potential partners present. Like Apple or Google.

Those two are better known for mobile mapping and have the brand cachet besides. But just like every other industry, from advertising to xerography, there is a concern. And the concern is that, ultimately, tech firms like Apple and Google and Facebook and Amazon are the competition.

Not, if you're in the business of making and selling cars, that Toyota or Ford or Mercedes are not a consideration, but this is about control. Control of content, of technology, of the revenue stream. All those net present values of future cash flows. Apple and Google will drive a hard bargain, if they are willing to bargain at all. Nokia, however, may be grateful to just be in the game. They are happy, delighted even, to be a good partner. And if their technology is just good enough, that may give them all the strategic advantage they need for the first time in a very long time. JL

Kevin Fitchard reports in GigaOm:

Nokia believes its can use its role as the auto industry’s mapmaker as a launchpad into the connected car. .
Rumors of a Nokia tablet has got the tech world buzzing, but Nokia’s plans to expand beyond the handset are much more ambitious than producing a mere slate. Nokia EVP of Location and Commerce Michael Halbherr told GigaOM that the Finnish handset maker is eyeballing the car as the next repository of its technology and applications and has plans to launch some form of connected car platform in the future.
Of course, Nokia is already a significant player in the automotive market. The company supplies maps for navigation systems through its Navteq group, which along with the rest of Nokia’s location services was recently renamed Here, the massive Nokia division Halbherr now heads up.
Nokia plans to use that deep-seeded mapping relationship with automakers as springboard into more sophisticated connected car and infotainment services, Halbherr said.
“Historically we’ve supplied content to the automotive industry – first maps and now traffic,” Halbherr said in a recent interview at Here’s Chicago HQ. “As more cars get connected we have the opportunity to move up the stack from a content player to a platform player to a services player.”
What kind of connected car services is Nokia planning beyond mapping? Halbherr wouldn’t talk specifics, saying the company would reveal more of its strategy soon. But he did say that Nokia is thinking far beyond the dashboard with plans to broach autonomous — or driverless — vehicle technologies and explore ways of integrating the car into larger transportation and “smart city” networks. This melding of the private vehicle into the public network is a topic Halbherr plans to discuss in detail at GigaOM’s Mobilize conference in October.
Halbherr said Nokia envisions cars that can not only direct you or drive you to your destination by the fastest possible route, but also cars that can send you on routes that minimize carbon emissions, that coordinate with the congestion and traffic management systems being developed in large cities and even work in tandem with public transit to more efficiently move people across a densely packed urban landscape. Halbherr said future connected cars can not only tell you the most optimal time to drive, they could also help you avoid driving altogether.

Connected car or connected cartography?

In our conversation, Halbherr consistently returned to the lowly map. The map may be Nokia’s automotive “in” and the primary ingredient in navigation systems, but Halbherr said it could be so much more.
Nokia’s North American traffic tracking center in Chicago
“What is a map?” Halbherr asked. “Historically it’s a visual representation of reality, but we are building more than a map. We’re building a one-to-one representation – it’s about a digital recreation of reality.”
Halbherr argues that all of the connected car’s most promising applications lean heavily on location. The map provides a context against which a car can compare real-time sensor information and data from other networked vehicles to navigate the streets.
Nokia Lumia City LensA car won’t just use a map to know its own location, but the location of the objects around it. Nokia is already overlaying that map with virtual information, which can not only be accessed by apps but can projected into the field of vision through augmented reality technologies like Nokia’s City Lens. In short, maps are going to make the connected car go, and there are few companies that can deliver the map that Nokia can, Halbherr
The unnamed company at the top of that list is, of course, Google. Last decade, Navteq and its Dutch competitor Tele Atlas (later acquired by TomTom) ruled the street mapping world, but Google has since established itself as the king of the interactive street map. Not only has it built what many would argue is the world’s most sophisticated navigation and location-based services operation with Google Maps and Streetview, but it is willing to acquire companies like crowdsourced traffic startup Waze that innovate in the space (though the Waze deal may be hitting some bumps with European regulators).
Still, Nokia has an enormous mapping operation. According to Halbherr it makes 2.7 million individual changes to its global maps everyday. It has created Nokia Here mapping and Drive turn-by-turn navigation apps, now standard on Windows phones and available on iOS and Android. It has traffic operations centers in North America and Europe that use roadside sensors, crowdsourced data from Here apps and even live traffic camera feeds to provide real-time congestion data to navigation companies and automakers all over the world.

Will the automakers buy into the Nokia car?

While maps are critical, there is a lot more that goes into a connected car. Nokia has years of experience integrating hardware, software and services – though Google recently gained similar expertise when it bought Motorola. Nokia also already comes with an OS known to the automakers, thanks to its tight-knit relationship with Microsoft.
Many automakers, including Ford already use embedded versions of the Windows OS to run their infotainment systems. Nokia can build on a platform they’re already comfortable with.
But the biggest factor in Nokia’s favor may be the fact it’s simply not Google, Apple or any other Silicon Valley interloper intruding on the automakers’ turf. Though some carmakers like Audi have already gotten in bed with Google Maps, and several more have signed on to work with Apple’s Siri Eyes Free voice interface, there’s a danger that by working with them carmakers will lose control of the connected car.
Google’s services are essentially free to consumers – it makes its money through advertising. Apple is trying to trying to substitute Siri for the dashboard interface, and the company that controls the user interface controls what apps and services the driver accesses. The auto industry has traditionally maintained a tight hold on what services make it into the car. It’s accustomed to charging drivers for services they could get free on a PC or smart phone and controlling what apps drivers can use. Carmakers don’t want their cars to be dumb vessels for some other company’s apps.
The automakers are a conservative bunch, but I believe they realize they have to become more open. They just don’t want to change as quickly as a company like Google wants. With Nokia, automakers have a comfortable relationship: Nokia sells them maps, and they in turn sell those maps to the driving public. If it can expand that model to other aspects of the connected car, then Nokia might be the exact partner the automakers are looking for.


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