Nokia Pumps $100M into Connected Cars
Nokia is investing $100 million to find more ways to integrate its HERE mapping and location services into more connected vehicles.
HERE is one of the divisions that remains, in addition to infrastructure and patents, now that Nokia Corp. (NYSE: NOK) has sold off its devices business to Microsoft Corp. (Nasdaq: MSFT). It's long been a small, but profitable venture for the vendor, generating 8% of the standalone Nokia's revenues. (See Nokia Ushers In New Era, Retires NSN Name and Microsoft Officially Closes Nokia Buy.)
Now Nokia says it's looking to do more with the location division, hence the launch of an $100 million Connected Car fund to be managed by Nokia Growth Partners (NGP) and used to invest in innovative connected car companies that would help bolster its HERE business. Nokia is specifically targeting growth in the US, India, China, and Europe.
This is the fourth fund that NGP has managed on behalf of Nokia over the past decade, and it brings Nokia's total invested with its venture capital arm to $700 million.
Why this matters
Nokia's mapping and location services have built a good track record with vehicles over the past 25 years, powering around 80% of car navigation systems through partners like Amazon, Microsoft, and Yahoo. But, the connected car space is also becoming more hotly contested of late, so Nokia will find itself up against others like Apple Inc. (Nasdaq: AAPL), which recently introduced CarPlay, its updated operating system for the in-car interaction.(See Apple CarPlay Puts Siri in the Driver's Seat.)
Being free from its devices business, however, may end up helping HERE as it allows Nokia to build for other platforms like Android and iOS, as well as pursue partnerships it might not have considered when it was tethered to its own devices.
- Nokia Reports Q1
- Finding the Value in Transportation Telematics
- AT&T Ups the Stakes in Connected Cars
— Sarah Reedy, Senior Editor, Light Reading