Nokia kicks off the scramble for location

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Nokia’s acquisition of Plazes today, the Germany location startup, will do one or both of two things. It will mean other mobile startups with location as a feature will be looked at in a more favourable light. The main startup in the UK in this arena – currently – is Rummble, but there are an increasing number of others, such as WeGlu, Moblog and Buddyping. It may also mean that the battle for location-based services has reached a peak, with startups now having to think about location being a “given” and then looking to create less commoditised services, like filtering, as Rummble does.

My industry sources are telling me that this was a smart acquisition for Nokia, which needed to have a consumer based offering outside the rigid maps infrastructure they have, since the purchase last year of Navteq.

There is also a local story here. The Plazes office is in Berlin, physically close to the Gate 5 people, and we know from good authority that Gate 5 people are highly respected on the Berlin scene. It’s therefore likely that they had a lot to do with the acquisition thinking inside Nokia as they know the guys from Plazes.

From what we know about Nokia, the purchase of Plazes fits in with their strategy in terms of context and location and what to do with it. Put together the Ad system they have, and they control a strong section of the mobile ecosystem from ad generation, delivery through branded channels, with good profile information about the user, especially since most new handsets from Nokia now have GPS built in.

  • Simon Grice

    mashup* is holding a Workshop 2pm – 6pm on the wider topic of ‘Local 2.0 – Hyperlocal’ on the 18th September in London:

  • Peter

    the lead investor of Plazes, Christophe Maire, who founded Gate5 and sold it to Nokia and who got the moneys from Doughty Hanson Ventures, might be for something in this acquisition.
    As we all know, sometimes rational valuation of internet companies doesn’t work, and some start-ups who were well-hyped, which is the case of Plazes (14M€ valuation form DHV in the last round), although they did not manage to gain momentum, because they got smart money (Marc Andreessen, esther Dyson, xing, etc…) manage their way out through an exit.
    But this has nothing to do with mass or even less commercial success.
    This is purely about politicking and opportunistic timing ;-)
    Nokia bought a brand, nothing more. But look, by any means the Nokia M&A team members have to justify their salary…

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