Nokia is buying digital mapmaker Navteq for $8 billion. (See WSJ coverage here). Navteq powers many in-car navigation services, but it is also one of the providers of mapping data used in Google Maps. Every mobile device should include mapping services. It’s a natural fit. But will Nokia try to charge extra for this or will every future Nokia phone come with free maps?
You can already get Navteq -powered Google Maps on many phones today like the iPhone or the Blackberry. It’s becoming a killer app for phones. Nokia could try to charge Google a whole lot more for the Navteq maps, but that might just drive Google deeper into the arms of its other map vendor, Tele Atlas.
The smart move for Nokia would be to negotiate with Google to share in any future map-based advertising revenues in return for distributing the mobile version of Google Maps with every new Nokia phone. (The cell phone carriers would have to be brought into the negotiations and given a cut as well, but it could be done). That way, consumers would get free maps and a reason to stick with Nokia. And Nokia won’t have to try to beat Google at its own game. Google has a much better chance of figuring out mobile advertising than Nokia, and its mapping software already has a huge following among both consumers and developers.