Heavyweights eye digital mapping companies

Digital mapping companies such as Navteq Corp. and Tele Atlas N.V. “now occupy the most important position in the global GPS navigation supply chain,” according to a new report from iSuppli Corp.
The ever-increasing value of mapping intellectual property holders was underscored earlier this month by Nokia Corp.’s bid to acquire Navteq for a whopping $8.1 billion. Analysts have speculated the move could force TomTom, a Dutch manufacturer of auto navigation systems, to raise its $2.8 billion offer for Tele Atlas.
But iSuppli said the combined TomTom/Tele Atlas operation might be a possible M&A target for a well-heeled technology company such as Google Inc. or Microsoft. As location-based services expand beyond dedicated devices to mobile phones, mapping intellectual property is becoming more valuable than hardware, iSuppli analyst Richard Robinson suggested.
“Speculation has arisen that Microsoft is considering a purchase of Garmin,” Robinson said. “ISuppli considers this to be less likely than Microsoft buying TomTom/Tele Atlas. This is because the key item in the supply chain is the map IP, rather than the navigation devices themselves.”