It is clear that Google wants to become the king of mobile applications. It believes that the next frontier of search is mobile devices. And the key to mobile search is location specific services, that is Google Maps, Google context mapification search with ad enabled context mapping mash up (pheww….). Today Google announced a partnership with TomTom, which is this smoke signal:
TomTom, which makes navigation devices for cars and mapping software for handheld computers, said in a statement its users would be able to search for business addresses on Google Maps and transfer them to their TomTom device.
Here is the thing. TomTom is currently trying to acquire Tele Atlas through an equity offering to the public.
Today, this saga reached its denouement as TomTom announced that it likely will issue 8.16 million new shares to raise the cash needed to help pay Tele Atlas’ inflated price tag of $4.2 billion. At the cost of diluting current shareholders by 7%, the equity float is expected to raise around $670 million for TomTom. Added to the cash already in the firm’s coffers, this gives TomTom a $1.7 billion war chest.
Here is the opening for Google. The $4.2B was a big amount to swallow and they are going to need a really good strategy to justify the acquisition. It is true that Nokia’s Navteq purchase is designed to control the market for GPS services on mobile phones and if this successful is going to cause a world of hurt for the other device manufacturers. They need to look for an independent third party (relatively) to service them. Some one who has a mobile platform with mapping services, search and frankly a comprehensive mobile application suite. Look for Google to take an interest in TomTom to complete (or support) it’s acquisition of Tele Atlas and eventually for the mobile GPS services to morph into a Google device. But what if Google also owned say a 700Mhz Block C license???………
