Optical/IP Networks

Nokia Puts Itself on the Map

CHICAGO -- Nokia Corp. (NYSE: NOK) doesn't want to be the "why" company (as in why would I buy a Lumia?) or the "how" company (as in how will it survive?), or even the "when" company (as in when will it launch its first Windows 8 phone?). It wants to be the "where" company, the de facto leader in location-based services.

OK, that might not be how Nokia CEO Stephen Elop and Executive VP of Location and Commerce Michael Halbherr set up the handset maker's ambitions in a media roundtable Wednesday, but location is pretty much all they wanted to talk about.

In Nokia's recently reported second-quarter earnings, the Location and Commerce business was the only unit that saw an increase in net sales year-on-year, at 4 percent. It's still a small proportion of Nokia's total revenues, which also include its struggling device business and Nokia Networks , but it's the unit that Nokia is investing in and hiring for. (See Euronews: Nokia Loses $1.9B in Q2 and Restructuring Costs Hit NSN's Q2.)

Nokia acquired Chicago-based Navteq in 2007 to become one of the leading mobile mapping companies alongside Google (Nasdaq: GOOG). With the upcoming launch of Windows 8, Halbherr says Nokia will use Navteq's assets to integrate location into the entire mobile experience. (See Windows Phone 8 Gets 'Common Core'.)

For example, if you take a picture, it will automatically tag the location and pull up the weather forecast for that area. Or, if you're running late in the car, use one click to send your spouse your location and your anticipated commute time in traffic.

Nokia is also getting applications makers and other OEMs to integrate its location platform. Along with its latest 2.5 maps release for Windows Phone on Wednesday, it announced a deal with Groupon to integrate its Now deals based on a user's location on the map. Other current partners include Yahoo Inc. (Nasdaq: YHOO), Flickr, Microsoft Corp. (Nasdaq: MSFT)'s Bing and Ford Research.

Nokia's goal is to integrate horizontally across the Windows Phone ecosystem as much it can, even if that means opening up to competitors.

"When Windows 8 ships, our platform will ship as part of the Windows 8 source code, so it's inside, not as an application," Halbherr said. "It will benefit everyone accessing Windows Phone."

Of course, Nokia's goal with mapping and location is to differentiate from the competition, something it desperately needs to do. Halbherr said that while its platform will work for all OEMs, it'll be the level of integration that sets Nokia phones apart, as well as a few exclusive apps.

There's also no end in sight for improving the going-from-A-to-B process either, Halbherr said. Nokia plans to take maps indoors, add three-dimensional imagery, improve search, add more social aspects and augmented reality, expand into other Internet-connected devices and add more app partners as it goes.

"Some apps will be specific to Nokia, but we won't withhold platform features," he said. "If you're in the platform business, you need to ensure parity or they don’t take you seriously."

Being taken seriously is something Nokia seriously needs right now. The company has a formidable maps competitor in Google, but more troubling is Google's ecosystem of Android partners that are already established in the market. Nokia's first Windows 8 devices will be coming out sometime this fall. Until then, the handset maker is struggling to keep its profile up as it restructures and focuses on what it does best -- right now, that's location. (See LR Reader Poll: Nokia's Takeover 'Joke'.)

"We may shift resources from one side to another, but in general, we have grown jobs in the location and commerce side," Halbherr said. "We need to run it as a business. And, it's a profitable unit."

— Sarah Reedy, Senior Reporter, Light Reading Mobile

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