A German car consortium consisting of Audi, BMW and Daimler has acquired Here Maps for £1.97 billion. Nokia confirmed the sale in the late hours of Sunday, ending the week long speculation of the division’s sale.
It is the second division to be sold in the past two years by Nokia, the first being Nokia’s Devices and Services Division to Microsoft for £4.6 billion. This deal looks to be more lucrative for the car consortium, given Here Maps growing clientele.
Nokia wanted to keep Here Maps open to other companies, something the car consortium were willing to concede. Other bidders, including Uber, Baidu, Alibaba and Amazon may have been less willing to license the technology once acquired.
“The acquisition is intended to secure the long-term availability of Here’s products and services as an open, independent and value creating platform for cloud-based maps and other mobility services accessible to all customers from the automotive industry and other sectors,” said the German car consortium in a press release. “The management of Here will continue to be independent—with the goal of moving the Here business case forward as a platform, open to all customers. The consortium will not interfere into operational business.”
Here Maps powers Amazon, Samsung, Microsoft and Facebook's mapping services. Losing the open licensing agreement would force most of these companies to partner with Google, a rival to Facebook, Amazon and Microsoft in some areas.
Audi, BMW and Daimler all use Here Maps for GPS navigation and mapping inside car dashboards. Other manufacturers have been moving over to Here Maps in recent years, with cheaper licensing deals than Google Maps.
Even with the growing business, Here Maps has never been a profitable division. The cost of acquiring new maps and ground photography has kept Nokia in the red.
The sale of Here Maps will allow Nokia to focus on the networking business, bolstered by the acquisition of Alcatel-Lucent for £10 billion. Nokia is also working on a wide range of new technologies, including a tablet, mobile and VR camera.
These new technologies are part of Nokia’s new low maintenance, high profit business. It will not manufacture in bulk, but instead license the products to third-party distributors.
Here Maps was announced in 2011 as the successor to NavTeq’s mapping program. Nokia acquired NavTeq for £5.1 billion in 2008, but has not been able to hit the same number with the sale of Here Maps seven years later.