Inside Apple's strategy: How the company built its new maps feature by making a strategic partnership and spending hundreds of millions on acquisitions.
Apple is taking a new road for its maps feature on its newest operating system, iOS 6. To the delight of many (and, of course, to the dismay of many others), Apple announced it will no longer continue its partnership with Google Maps. Instead, it has spent hundreds of millions of dollars creating its own map application--mostly through a strategic partnerships and by acquiring small companies working on geo-technologies.
Apple announced Monday a partnership with TomTom, the Dutch manufacturer of automotive navigation systems. The news was good for TomTom, which has struggled recently. MarketWatch pointed out that TomTom saw its stock ticker jump double-digits; while the news deflated its competitors--TeleNav and Harman International Industries. Their stock dipped more than 6 percent each.
The path to an independent Apple map application has been at least three years in the making. It began when Apple began assembling its "Geo Team," largely by poaching talent from companies such as NextBus, a GPS predictive data software start-up, and INRIX, a top provider of street-traffic data.
It has also acquired full companies to get positioned for the map launch. Here's a look at the three mapping start-ups Apple purchased that helped lay the groundwork for a unique Apple map application.
Start-up 1: Placebase
Location: Los Angeles
Acquisition: July 2009
Apple's first maps-related purchase--of Placebase--signaled the company's potential intent to develop its own interpretation of a map feature. Placebase hadn't created its own map, but essentially built a system for companies to easily stack features on top of existing maps. The blog GigaOm explained how Placebase and its founder, Jaron Waldman, set Placebase apart by layering customizable data on top of maps using an easy-to-use API.
One, by offering customizations and tons of features that integrated private and public data sets in many diverse ways. (He knew it would be a while before Google would get around to offering customization). His other twist was to offer a way to layer commercial and other data sets (such as demographics and crime data) onto the maps using an easy-to-use application programming interface (API). The product is called PushPin.
After the acquisition, Waldman became a member of Apple's Geo Team, the unit tasked with developing a unique map for the company's new operating system.
Start-up 2: Poly9
Location: Quebec City
Acquisition date: July 2010
Poly9 was founded in 2005 as a bootstrapped start-up, with no venture money. The company powered map-based apps and programmed interfaces (APIs) for companies such as Microsoft, Apple, and MSNBC. It also powered the annual NORAD Santa Tracker.
Details around its acquisition were murky.
TechCrunch reported: "So far Apple and Poly9 have not confirmed the acquisition, but French-Canadian reporter Pierre Couture of cyberpresse.ca (via Google Translate) reports that all but two of the employees are now relocated in Silicon Valley and that they are zipped up due to non-disclosure agreements."
With a little LinkedIn sleuthing, we find out that Denis Laprise, the CEO and founder of Poly9, is now an engineering manager for Geo Team at Apple, as are at least four other former employees.
Start-up 3: C3 Technologies
Acquisition: August, 2011
The purchase of C3 Technologies reflects Apple's desire to deliver some really radical changes to map applications as we know them today. C3 had used planes and helicopters equipped with cameras to map out physical landscapes that offered "photo-realistic models of the world." Users could search a location and, unlike satellite or street view, could actually get a sense of the topography of the land. The company was spun out of the aerospace and defense company Saab AB in 2007, and has "redefined mapping by applying previously classified image processing technology to the development of 3D maps as a platform for new social and commercial applications."