san marco schreef op 11 augustus 2015 14:02:
Mapmaker's team of rival automakers may expand
Here's buyers hope to share costs, benefits with others
Here has funded its work on three-dimensional maps by selling traditional navigation maps to automakers.
Automotive News
August 10, 2015 - 12:01 am ET
Audi, BMW and Daimler were bound to raise eyebrows around the auto industry by teaming up to buy Here, the dominant supplier of digital maps for in-car navigation.
So the Germans are sending a message to their competitors: Don't fear us. Join us.
The $3.1 billion acquisition of the Nokia subsidiary, announced Monday, Aug. 3, was mainly a defensive move. Audi, BMW and Daimler sought to keep Here from falling into the hands of a Silicon Valley company such as Apple or Uber that wouldn't share their vision.
Yet other automakers might have had reason to worry that the new owners could use their control of Here's maps to freeze out their competitors.
To defuse that fear, the German trio is now inviting other car companies to join their consortium, sources say, and share in the development costs and benefits as cars become more automated and connected through maps.
"Maps are a common denominator for everyone," Thilo Koslowski, an analyst at Gartner Inc. in Santa Clara, Calif., said in an interview. "It doesn't make sense for every company to do it themselves. But everyone can benefit from it. ... I believe this deal could ultimately accelerate the realization of self-driving cars by a couple of years."
Everyone working on self-driving cars, from Mercedes-Benz to Google, sees maps as critical. Sensors have limitations, and detailed three-dimensional maps of the world, charting the path of lanes and the position of objects such as fire hydrants and streetlights, make it far easier to follow the rules of the road and avoid crashes.
Here has worked closely with the German automakers on their experimental cars. In 2013, when Mercedes trained an S500 sedan to drive 62 miles from Mannheim to Pforzheim, Germany, to show its progress, it followed a route pre-mapped by Here.
"Maps are a common denominator for everyone. It doesn't make sense for every company to do it themselves. But everyone can benefit from it."
Thilo Koslowski
Gartner
In an internal video explaining the deal last week, Here President Sean Fernback said his company would function as a neutral "Switzerland of mapping" with independent management, offering its services to any company.
The company's customer list already includes nearly all of the world's largest automakers, including Ford, Fiat Chrysler, General Motors, Honda, Nissan and Toyota. All may ultimately be invited to join the consortium.
Yet it remains unclear whether consortium members would need to take an ownership stake in Here or simply provide money and data in exchange for the latest maps and services, said Kevin Hamlin, a senior analyst at IHS Automotive.
"The three members still need to define what the consortium is," he said, "and what benefits you're going to get out of it."
Opening up the consortium is more about pragmatism than altruism, Hamlin said.
While the German automakers see Here as a protective bulwark against reliance on companies such as Apple and Google, the cost of building and refining three-dimensional maps is daunting, even for three highly profitable companies.
Here has funded its work with revenue from selling traditional navigation maps to nearly all the world's auto powerhouses. If Audi, BMW and Daimler wanted to keep the fruits of its labor in house, they would need to bear those costs themselves.
"It's been very clear that whoever was the buyer at the end of the day, there had to be room for substantial investment," Fernback said in last week's video.
While it's rare for bitter rivals to band together on a high-tech business venture, it's not unprecedented.
Back in 2000, at the peak of the dot-com boom, Ford Motor Co., General Motors and DaimlerChrysler teamed up to form Covisint, envisioned as a way to cut procurement costs by handling billions of dollars worth of transactions among automakers and suppliers on a single online exchange.
It didn't work quite as intended, and not just because the dot-com bubble burst before Covisint could make a splashy IPO, said Dave Miller, a veteran of the Detroit-based company who is now its chief security officer.
"The most difficult thing for us was finding places where [automakers] agreed that things would be done in one way," Miller said. "The one part of the platform where they agreed to do things commonly is the one thing that's still part of our platform."
That thing was secure machine-to-machine messaging, which Covisint, now fully independent, uses to run security credentials for connected-car services such as GM's OnStar and Hyundai's BlueLink.
Reflecting on his experience, Miller urged Audi, BMW, Daimler and any future partners to respect Here's independence.
The lesson, he said, is to "keep your hands off it."
You can reach Gabe Nelson at
gnelson@crain.com.