En dit is wat verteld is over het verdienmodel en pricing
Businessmodel
By using the new Maps Platform, you actually use your base map also as an entry into those new markets, right, where you attract a lot of you potential business partners that you don't do today. So you extend your, like I also demonstrated, you extend your addressable market massively. And then you start adding your value-added layers, and maybe also private layers, and your application layers, where there's a lot of margin and money as well. So, that's the way you start building that revenue, without diluting it short-term. So, it's a process between short-, mid-, and long-term, where you take your current partners by the hand. And where necessary, you move over faster, depending on their pace and their needs. So, that's the whole dynamic. But, short-term, I don't see a risk of dilution. Or mid- or long-term. It's a very clear path forward. We open up to a much bigger market, with an entry point, which is the new Maps Platform, and you start building on that as well. And guiding our current customer base by the hand.
In terms of business model, the base map essentially serves as the low-cost entry point into the product portfolio. There's limited restrictions, but it also has limited data and service level agreements attached to it. The purpose of it is to encourage application developers to develop on top of our base map. Now, remember, there are only five base maps in the world, the base map integration and dependence is typically very deep. As such, this serves as our vehicle for selling the value-added data. Now, currently, none of our competitors are providing this low-cost low friction entry point into their product portfolios, so this is new. For the value- added data, it is proprietary, and we break it into packages for different use cases and for different geographies. And as such, a customer can choose which package they want. We price it in a subscription like model. They have the right to use it and receive updates for this data. Now, there are significant licensing and usage restrictions on the product to avoid channel conflict and to enable high price realization. But also here, the model of having detailed packaging and distribution, under a new recurring revenue model, is new to the industry. And early feedback on this has been very positive.
So, for the services, they're sold based on usage, similar to how most API businesses are run. And for some segments and services, the billing is based on number of requests. For example, the customer would pay based on how many times their end users are searching for an address. And for some segments, like logistics that we're talking about before, the billing is based on how many vehicles they have in the fleet. Now, lastly, for the SDK, part, we build on top of the usage of the services, and the smaller application developers typically integrate the SDKs themselves. Whereas for larger customers, we often do the integration against a fee . And in fact, for some customers, in particular in Automotive, we even do custom development. Now, we see the move here, towards clear packaging, recurring revenue, easy entry points, and a high degree of reuse as key building stones of the strategy and the business model.
Now, another key building stone in the strategy is how we are forming an ecosystem around data collaboration. There's an enormous amount of data in this industry. And no doubt the data is crucial and valuable. But in practice, in reality, most of the data actually goes unused. The reason for that is that it’s proven difficult and costly to synthesize the data. And knowing the location of all people, and all vehicles in the world in itself is not so useful. It's only when you synthesize it into traffic jams that is truly helpful, as an example.Now, it also proves that [b]the magic with geospatial data happens only when you put together a lot of different types of data on a global basis. So you need it all. And furthermore, handling this type of data requires a very unique skill set. So that effectively leaves most of the data in this industry sitting with our customers and partners unused.However, if you think about these problems, this is exactly what we are TomTom are exceptionally good at.
And maybe two things just add on pricing there. As we're creating much better products, that should translate, at some stage, into some kind of pricing leverage. The second one would be that the problems that we're solving are more foundational in Automotive. As in, if knowing how and where to charge your EV car is crucial to the overall user experience, that should come at higher price point. As well as ADAS features, they're more integral to the overall experience. Again, as the data and what we provide is crucial, that should translate into pricing.