|A North America map is selling for $80 and Europe map for at least $150 by retailing, or if you want to download one for your Garmin or Tomtom GPS from these two companies. NVT charges automobile makers more than $100 a piece for their vehicle GPS. |
Now "Nokia's ultimate goal is to make navigation in mobile phones as ubiquitous as cameras, … and Nokia plans to include navigation features in roughly half of its phones in the next two to four years, Wood says. And while TomTom will sell 14 million to 15 million devices this year, Nokia will sell some 400 million phones this year, roughly half of which will be navigation-ready.” ( businessweek.com )
If Nokia fails to merge with NVT, Nokia has to choke $3 billion for maps alone – even at the price of $15 a copy for its 200 million cellphones. (Did I calculated it wrong? )
If 25% of the remaining cellphones sold by companies other than Nokia, which has about 40% of market share, will have a GPS, that’s another 150 million copies of map worth $2.25 billion - again for a mere $15 a copy. If NVT keeps its 65% market share, NVT’s revenue would be about $3.2 billion from mobile phones alone.
Do you prefer NVT being bought by Nokia, or keeping independent if you’re a Navteq shareholder?