This Is How Apple Ditched Google Maps

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At long last, Apple (Nasdaq: AAPL  ) has done it. It has given Google (Nasdaq: GOOG  ) Maps the boot and is taking the spot back from the search giant-turned-mobile rival. It's as if Cupertino is saying to Mountain View, "Thanks, guys, but we'll take it from here. Oh, and by the way, we're also giving your China search seat to Baidu (Nasdaq: BIDU  ) ."

One of the bigger challenges that I considered leading into the expected switch to an in-house maps service built off three different acquisitions over the past several years was how Apple would replace the backend data.

iOS head Scott Forstall covered some of this during the keynote, saying that Apple was building up a traffic service that would also include an element of anonymous crowdsourcing of real-time data from anonymous iPhone users. He also said the iPhone maker had "ingested" about 100 million local business listings around the world now.

Well, we now have some more detail on one of the larger pieces of the maps puzzle that Apple has assembled to displace Big G's valuable data: TomTom (OTC: TMOAF.PK).

That's right, the maker of the well-known handheld GPS devices is now partnering with a company whose iPhone is a major disruptive threat to its own offerings. TomTom has long had iOS apps, but this partnership takes it to a new level and is a big win for TomTom. If you can't beat 'em, join 'em.

Source: Engadget. Emphasis added.

Source: Engadget. Emphasis added.

The company confirmed to Engadget that it has "signed a global agreement with Apple for maps and related information." In addition, you'll find fine print pointing to TomTom's data within the iOS 6 beta maps app.

Shares trade over the counter stateside and are very illiquid, so exercise extreme caution if you're considering a position, but they have skyrocketed by upwards of 17% in trading in Amsterdam, where TomTom is headquartered.

What Google service will Apple drop next?

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Fool contributor Evan Niu owns shares of Apple, but he holds no other position in any company mentioned. Check out his holdings and a short bio. The Motley Fool owns shares of Baidu, Apple, and Google. Motley Fool newsletter services have recommended buying shares of Google, Apple, and Baidu and creating a bull call spread position in Apple. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

Read/Post Comments (4) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 13, 2012, at 1:49 AM, xmmj wrote:

    It is important here to understand Apple's motivation. Ever since they were almost torpedoed by MSFT's successful efforts at controlling the market by designing incompatibility into their products (specifically IE and Office), Apple has been careful to never again be at the mercy of another company for a key technology. This is why they created Safari - to protect their ability to render their own pages properly. On smartphones, maps is a key technology. Hence this move.

    The features provided by Tom Tom are (a) beneficial but not a key, and (b) there are other potential suppliers.


    extraordinary short-short fiction

  • Report this Comment On June 13, 2012, at 4:25 AM, fatmonk wrote:

    Looking from an other perspective, Ditching out Google Map is google forcing Apple to do so. Google map for Android has "Turn by Turn" but none for iOS. Apple forced to play catchup. Apple could buy Tom Tom with the money which Apple save from paying one year of Google Map Service.

    Apple could integrate iMap to OsX.

  • Report this Comment On June 13, 2012, at 5:32 AM, H3D wrote:

    Apple know that their users do not want constant, in your face, adverts in everything that they do.

    Google maps is getting excessively filled with obscuring advertisements.

    So Apple can differentiate their maps, and therefore their device, by preventing this disruption.

    Google cannot compete on this front since the adverts are its sole route to making money.

    I suspect that Apple will gradually strangle Google's ability to make money from advertisements on its platform.

    Look at Safari reader.

    Look at Siri.

    Google can copy these things, but do what. Doing so would damage themselves, not Apple.

    In the end the world will be split between people who spend 33% of the time/screen/attention watching adverts and 66% on themselves, and think that they're getting something for nothing. And those people who are willing to pay fair prices for content, but want no advertising.

    And once the advertisers realise that their adverts are only being seen by people who want something for nothing, they'll stop paying.

    Bye bye Google.

  • Report this Comment On June 13, 2012, at 7:54 AM, jdmeck wrote:

    This could hurt Tom Tom, but if they had too, Apple could just buy them or the technology out right.

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