Books written by Ray Sullivan

Saturday, 15 December 2012

Apple to Buy Tom Tom

You would think with all their resources Apple would be able to build a mapping app for their iOS.  But after  being slated within hours of the initial release in September up to the recent scathing remarks from the Australian police a few days ago they are still struggling to sort it out.  Sacking senior managers didn't work, either.

It turns out that the mapping module they've been using belongs to Tom Tom, the European mapping software and hardware company.  Tom Tom have a good reputation, over here in the UK at least, although they do get blamed for sending articulated wagons down farm tracks every now and then.  I have a personal theory that the next innovation in GPS mapping needs to be a common sense detector, one that shuts the device down when it detects that the driver is incapable of thinking for him or herself.

Anyway, it seems that Tom Tom would like some cash - about 100 million Euros, give or take - and Apple have a fortune lodged outside of the US that would be taxed to within a cent of its life if brought back into the mother country, so buying out a European company is a great way of using that surplus.

Oh, and Apple need a functioning mapping app that works.  It sounds like they've decided that their own attempts at using the Tom Tom mapping data is not going to happen.  I find it surprising and have assumed that Apple were about to do a 'ta-da' gesture with a re-released and correctly functioning version of their mapping app, but there you go.

They've been wooing Tom Tom and have been flashing the cash, according to industry rumours.  It appears that a purchase announcement is imminent, so if you're a Tom Tom shareholder then it looks like Christmas has come early.

There's another dimension to this story, though.  We know the market leader in mapping apps for mobile devices is Google, who have also spent a lot of time melding their app to a self drive module, creating a car that drives itself.  Cars that drive themselves could be the next big thing - if done intelligently you could imagine a world where all the cars in a city take their passengers efficiently to their destinations, exchanging travel data to a central cloud.  That way traffic jams can be avoided, fuel can be saved and frustration can be reduced.  Apple will have seen what Google is doing and will want to elbow in that market.  Getting a major slice of the automobile industry has got to be a fantastic growth sector.  A marriage between Apple and Tom Tom, arguably the predominant GPS navigation device in the market, will be a major step towards catching up on Google.

And of course Tom Tom wouldn't be able to achieve all of the research and development without Apple's cash.  Or its Cloud knowledge.

I don't know if all this speculation is likely to be close, but it is reasonable.  If it is, then Apple is embarking on an incredible journey, and having Tom Tom aboard is a shrewd companion.  At least they will know when they've reached their destination.


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