Nokia Indexing the Real world – the next Google, potential to be “a significant disruptor”

| February 27, 2013 | 69 Replies

 

Screen Shot 2013-02-27 at 19.42.40

Quick heads up on this article over the The Register. Nokia’s crunching up big masses of data to index the real world in a bid to outflank the likes of google.  Here we’re seeing precisely how Nokia is capitalising on their location platform.

http://www.theregister.co.uk/2013/02/27/nokiareal_world_search/

http://www.theregister.co.uk/2013/02/27/nokiareal_world_search/page2.html

But with “real world search”, Europe’s biggest tech company is launching the next epic industry battle, and Google is firmly in its sights. If it reaches even a significant fraction of Google’s web-page search revenues, then Nokia will be a significant disruptor, and a major player in its own right.

Cheers Muerte for the tip!

Category: Nokia

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Hey, thanks for reading my post. My name is Jay and I'm a medical student at the University of Manchester. When I can, I blog here at mynokiablog.com and tweet now and again @jaymontano. We also have a twitter and facebook accounts @mynokiablog and  Facebook.com/mynokiablog. Check out the tips, guides and rules for commenting >>click<< Contact us at tips(@)mynokiablog.com or email me directly on jay[at]mynokiablog.com
  • larryg968

    Lmao. Nokia couldnt create an operating system but Nokia can analyse data to make predictions/ recommendation, thus forging a new segment of technology. Additionally, they will do this before Google. Lmao. That will never happen.

    Google Now will evolve and be ‘this’ before Nokia can sell 10 mil WP phones a quarter

    • Muerte

      It is very clear from your comment, sir, that you have no idea how major player Navteq is in the field of location based services.

      • larryg968

        Being a major player in map does not mean Nokia can analyse data better than google. This is what google does. Google creates algorithms to index the web and allow fantastic search.

        Now, Nokia, the company that maps a decent maps application is gonna out maneuver Google and magically change the world as we know it.

        Thats just ludicrous

        • Mark

          Well, actually it does.

          You do realise there is no logic to your statement at all, right? :)

          • larryg968

            Lets review where nokia(whatever this project is called) and google(google now) in a few years.

            Im certain this will be as successful a WP

    • senshi

      Idiot, Google got big before it even began creating its own OS. OS creation has crap all to do with data analysising.

      • Mark

        Sshhh… don’t confuse the poor dear with facts! :)

      • dss

        Android and Chrome OS (and the browser) are tools for google to that with… that is the whole point. They distribute ads and collect data from those, the more people use them, the more money they make, and the better their indexing becomes.

        Google makes 90% of their profits from advertising… think about that the next time you buy and android phone.

  • Luisito

    Mmmm… Will Nokia follow its own tradition???…

    • Banderpop

      By ‘tradition’, do you mean rebrand their Real World Search every year or so, then abruptly burn it to the ground as soon as it works properly?

      • incognito

        And replace it with Bing!

  • twig

    Nokia 520 is cheaper than iPod nano and does over 130,000 things more.

  • Janne

    Nokia has several healthy parts that have been and are in better shape than the overall company image. Location and lower-end phones are two, NSN is probably becoming one.

    Just because Nokia has been faltering in smartphones doesn’t mean all parts of the company are as bad. They definitely are not… There are very competent teams in place and have been.

    So, location, location, location… and ads. There will be more of this.

    • Luisito

      I’m still wondering why Nokia sold their own ads solutions… I mean it’s essencial now, are we looking plan b in action???

      • Janne

        It is a complete myth that Nokia sold anything relevant in ads. They shed some excess non-core stuff that wasn’t relevant to location-based ads. Ads were and always have been a part of the February 11th strategy. As has location.

        People just have a hard time understanding it because they aren’t paying attention to understand the bigger picture.

        • Luisito

          You will make me going back to revisit some posts… If my mem isn’t failling me Nokia sold their ad solution some months ago, because well they won’t be making any OS to compete in the SmartDevices territory to drive that ad solution (that was let to MS and WP), of course there must be something to drive the ads over S40, but it belong to them or to someone else…
          Before reading again, and again the Post title I must say it must be change, Google has already indexe the real world (if not all, most of it), What Nokia is goin to do is to index (and it will be in very high scales) our behaviour, and that’s the wets dream of big corps

          • dss

            Right, and google having huge volumes of data, won’t have e head start towards that goal ? Microsoft seems to be the only one who can compete with google on a “search” and indexing level.. they are not on the same level, but I don’t see anyone else that can do that.

            Microsoft really needs Windows 8 (phone and PC) to ramp up some sales, that way they will get more bing clicks, some people are just lazy to change it to google or whatever, and to be honest, its just as good for casual search..

    • Tom

      1. Location isn’t a big business, at best it makes/losses a few hundred million dollars.

      2. ads – Even mighty M$ is losing money after decade and tens of billions investment in Bing. There is zero probability of it.

      If they want to do something, need to find a new market. Going head on with big players isn’t best strategy. Their strength isn’t in big data.

      • http://twitter.com/haranguemnb Harangue

        I’d tend to agree with you on the location thing not being a large business, but I also think it isn’t a large business now. Just look at what Nokia is doing with Navteq and things like public transport data and data on restaurants and the lot. Google is also investing heavily in that sector because it can potentially make their search offering reach far beyond just the internet and into the realm of what we use in real life.

        That is probably what Nokia sees as potential. It is a gamble, but it might pay off in the long run if executed right. Which could pose to be problem for Nokia.

      • correct

        Never count out Nokia on innovation. Nokia has a PROUD tradition of innovation going back OVER 100 years. This goes FAR deeper than the cell phone industry.

        You might want to check Nokia’s Q4 2012 results. Their location division actually made a very nice profit, and it’s growing bigger and bigger.

        • kues

          L&C net sales is not growing (yet). Q4 net sales declined YoY mainly due to lower internal net sales (lower smartphone volume). Full year
          net sales are almost equal: 1103 million (2012) to 1091 million (2011). Non-IFRS full year profit did rise from 48m to 154m- but that is still less than 1/10 of 2011 Devices&Services non-IFRS profit.

          But as Nokia stated in Q4 fiscal report a negative non-IFRS profit is expected for Q1/2013- no profit, not growing for the near future:
          “Nokia expects Location & Commerce non-IFRS operating margin in the first quarter 2013 to be negative due to lower recognized revenue from internal sales, which carry higher gross margin, and to a lesser extent by a negative mix shift within external sales.”

          • correct

            Always love to a cynic yes? Being negative is very popular with posters here I see.

            Not growing yet … except Toyota recently signed a new agreement for HERE licensing, Amazon’s agreement continues, and Mozilla has signed a new HERE agreement. Also HTC and Samsung may already be paying for regional map licenses for their WP devices this quarter.

            So this quarter yes I would expect growth compared to last quarter. The HERE re-brand only became fully official just a few days ago.

            Regardless of what Nokia said, I am simply following the facts. Even if non-IFRS profit drops or is negative in Q1, that doesn’t mean they’re not growing.

            How about we get back to the topic at hand, yes? The topic being just how *revolutionary* this idea from Nokia really is.

            • correct

              Nokia also said months ago that Q4 2012 financial numbers would not be good, yet they surprised everyone with a profit.

            • kues

              Always love to read actual numbers.
              You wrote “You might want to check Nokia’s Q4 2012 results.”- i say better double check on them.

              Of course HERE has beautiful plans for the future, but Nokia right now is running out of time:
              NSN ownership has to be resolved as Siemens wants to get out as soon as possible.
              Cash (flow) is still critical in 2013.
              Devices&Services sales numbers, revenue and profit still are bad: Nokia lost 81,5 million mobile device sales 2011 to 2012. Q4 alone 27,3 million mobile devices (13 million smartphones and 14,3 million featurephones) less were sold YoY. non-IFRS full year profit dropped 2,3 billion € into deep red. and so on…

              • correct

                Since you like numbers, I’m sure you also know that *cash on hand* increased by almost a Billion to roughly 5 Billion Euro right now.

                And Q4 non-IFRS profit was quite nice at half a Billion.

                So I don’t see much red in terms of cash flow. Cash flow is increasing not decreasing.

                • kues

                  Nokia Group net cash end of Q4/12 was 4,36 billion € of which 1,3 billion € belong to NSN, so Nokia has only about 3 billion € net cash.
                  Q4/11 Nokia had over 5 billion € net cash (NSN had almost no net cash back then, Nokia Group 5,58 billion €).
                  All in all Nokia burned over 2 billion € cash in 2012.

                  In Q4/12 net cash from operating activities for Nokia Group was 563 million € of which NSN made 740 million€- resulting in -177 million € for Nokia.

                  And just imagine Nokia would not have succeeded in placing the 750 million € convertible bond in Q4…

                  • correct

                    You make it sound like NSN is a completely separate company. How cynical of you, yes? Are you a Meego or Symbian developer by any chance?

                    • kues

                      NSN is a separate company. It is jointly (50/50) owned by Nokia and Siemens, but completely consolidated on Nokia Group balance sheet.

                    • correct

                      You’re arguing over semantics at this point.

                      NSN is still a part of Nokia Group. Nokia still gets a cut of the profits.

                    • kues

                      No it’s not about semantics. It’s about legal and practical issues. Nokia on it’s own can’t access NSN cash. They would have to reach an agreement the Siemens about transferring cash from NSN- just like they did 2011 when both Nokia and Siemens each transferred 500 million € in cash TO NSN.
                      There are tensions between Nokia and Siemens about NSN already -e.g. remember Siemens intervening when NSN planned to close down the complete NSN operations in Munich 2012.

      • Janne

        Nokia is already a big player in location. One of the two big ones. Google is the other.

        And you guys are still thinking so small when it comes to location and its future. Think bigger. The potential is huge.

        Guarantees of success? Of course not. But the potential is huge and this is a big part of the February 11th strategy.

        Watch this space at Nokia…

        • correct

          Yes, we know can see what Nokia was referring to when talking about location and the huge potential of it.

          I’m sure Nokia has more secret projects going on and innovations in their labs we have no idea about.

        • Tom

          It’s all good, let’s say location will be a huge success. Still 10 of those location divisions not going compensate for devices and services. Nokia is now 10th player in smart phones. All we have heard from Elop is promises, no results.

          Dreaming is fine, day dreaming isn’t.

        • Dr.Smart

          “Location” is so much more than a map plus some associated data sets. It is more about on-offline integration, a genuine eco-system (not the apps plus bing plus xbox kind that Elop keeps talking about), where off-line businesses and on-line services mesh together to create new types of on-site accessibility services to the users.

          Because Nokia has been off-loading the so called “non-core” business such as Nokia payment and rather had been more device-centric recently, Nokia DOES NOT any more possess the off-line connection to drive home the location business to become an eco-system as such.

          Of course, Elop might want to resort to piggy-backing on MS for other type of service capabilities, but that precisely defeats the whole point that Nokia can foster its own platform-agnostic location eco-system.

          In short, Nokia is no Google, and, at best, Nokia can hope to stay relevant in a minor way by staying a supplier of map data to MS and some car companies, and nothing more.

          • Jyrki Sukula ottaa voiton Ramskista

            Services like Nokia payment were not that big and their growth potential seemed to be quite limited. Real potential and not something someone imagined.

            What do you mean by off-line business meshing together with a on-line services?

            Not connected business connecting with online services? Isn’t that just what the internet is about? People ordering even pizza online.

            What could have Nokia possibly offered what’s not available at the moment? NFC and services for that will take years to get even really started. Nokia money services were actually not that successful and Google Maps pretty much shot down charging for maps.

            Offline maps were one business opportunity but constantly improving data connections that’s no longer such an issue. Besides it doesn’t cost that much to get all those offline maps purchased separately and if you do that, you have some real choices. Not just getting something Nokia decides is best for you.

            Nokia never was Google and never had what Google has. They just shipped phones and maps.

            • correct

              Incorrect regarding offline maps. Huge parts of the world still have limited connections, and the billions of people out there who don’t yet have cell phones … they live in areas of limited connections, where offline maps become a huge deal. Also in many countries that do have data connections, people are very price-sensitive, or have limited data plans, so offline maps is still a big deal for them in those countries.

              • Jyrki Sukula ottaa voiton Ramskista

                So?

                Those parts of the world are spending less money on mobile phones.

                People here in MNB just don’t understand how important something like US is in the mobile world.

                It’s nice that Nokia is able to sell a bit more of those dirt cheap phones because they have offline maps but that is not really so great business.

                As you said, Nokia’s revenues for the maps were only 278 million and they are not the only maps provider. It will be very hard to make that business to make enough profits so they could really live from maps. Not only from maps but making the maps big enough for Nokia.

    • incognito

      Ssshhhhh, don’t point out to Elop that there are still some healthyish parts of Nokia, he might decide to do some strategizing in those sectors as well. *scary*

      I say let him beat the dead horse (which he killed, mind you) until he’s sacked, replaced or leaves Nokia in any other way.

    • nn

      Sorry, but this is patently false. Read the buzzword again – noticed the “big” part? Nokia would need lot of data for this approach, which means selling lot of smartphones. Rreally really lot of smartphones to really really lot of users. And it’s not that’s problem for now, with the unsellable WP that’s not going to happen ever. The best scenario is Elop finds unlimited source of money that will keep Nokia hovering in the low single percent territory.

      So the maps business crucially depends on smartphone business, the moment WP utterly failed so did the maps. And that’s before we talk about the validity of the other ideas, like if people are really going to change their favourite pub just because Elop told them to do it, or if advertising in maps can work with meaningful profits.

      • dss

        The same can be said for Microsoft.. if nokia sells lots and lots of smartphones, its really good for bing

  • correct

    This is truly incredible. These past few days I’ve felt so proud to be Nokia fan. What they’re doing at the low-end and mid-range with the new models, the revolutionary new innovation in base stations from NSN, and now this big plan. Simply amazing.

    So this is the whole grand plan behind the HERE re-branding, and offering HERE to competitors. It’s all about scale, and importantly they’re not giving it away for free.

    Also here are some cold hard facts that will shut up the trolls:

    “In one corner is where Nokia keeps its “first and best” products. Everything else on the grid is licensed out; this includes things that were touted as Nokia-only unique mapping-based apps but will rapidly become platform features. CityLens is an example: it’s now another HERE platform API called Livesight.

    So the three tiers on the licensing grid are Nokia-only products, technology for Windows gear manufacturers, then things for all the other hardware companies.”

    …..

    “There is a price for the data and a price for the SDK [software development kit]”

    …..

    “So a Nokia Lumia owner will get access to all the world’s offline maps, but an OEM gets just a country licence, Halbherr explained.”

    ——

    So all the trolls and fanatics can shut up already. Lumias will still have THE BEST HERE apps, and Lumia-exclusives before anyone else.

    All other HERE services *are paid licenses*. So Amazon, Toyota, Mozilla, and other companies using HERE … they’re ALL paying Nokia license fees.

    Also now we see the distinction between Lumias and other WP devices. Non-Lumia WPs get regional offline map license, but Lumias get worldwide offline maps. This is of course assuming that non-Nokia WP manufacturers are willing to pay the license fee.

    • JGrove303

      This. Answers. Everything.

      +1000

    • http://www.twitter.com/harangueMNB Harangue

      I’m either missing it or you haven’t mentioned it, but where did you get these answers and who are they from? These are some great insights.

    • SmoledMan

      Google is the #1 in maps. Who needs Nokia? Nobody does.

      • ULTIMATEANTITROLL

        OUT OF THE WAY TROLL!!!! NO NEED TO FEAR, THE ANTI TROLL IS HERE!

      • Mark

        Well people without an internet connection for one!

        Busted! LOL! :)

    • nn

      And you got that “paid” licenses where, exactly? Do you realize that licensing doesn’t necessarily mean paying money, let alone a lot of money?

      Last quarter W8 sold 60M licenses and yet the impact on Nokia’s map revenues is nada. Nobody sane is going to pay them any significant money for the maps when there is Google.

      • Jyrki Sukula ottaa voiton Ramskista

        Google pretty much Killed Nokia’s mapping business with Google Maps. That happened long time ago.

        • correct

          Wrong 4S troll. Nokia’s mapping data is used by TONS of companies. Outside of smartphones, Nokia’s mapping data dominates.

          The majority of automakers use Nokia mapping data for their navigation systems, just as one example.

          Nokia is expanding the Location and Commerce division, it’s growing, and they’re hiring more people to work at the division.

          Here is a list of companies that currently use Navteq data: http://www.navteq.com/company_our_customers.htm

          I see companies like Samsung mentioned there. Ironic isn’t it? Nokia’s biggest competitor also happens to be paying a license for Navteq maps. Some very big companies and competitors listed there.

          This list also does not include the other recent license agreements Nokia has signed for mapping data, with companies like Oracle, Amazon, Groupon, Mozilla.

          In Q4 2012 the Location and Commerce division had net sales of $278 million, and external net sales increased year-on-year. Nothing dead about that.

          • Jyrki Sukula ottaa voiton Ramskista

            Wrong.

            Nokia’s maps are used by lots of companies but I was not talking about that. I was talking about business. Nokia is not getting that much revenues from the maps.

            This is unfortunately true. Just check this from the interim reports. It’s not so great business for a company like Nokia.

            $278 million is peanuts for a company like Nokia.

            And the worse part? That’s not even profit. That’s just revenue.

            I understand how you hate someone pointing out how crippled 808 is because of the lack of applications but please don’t lose your objectivity because of this fact announced in public.

            • Janne

              Nokia’s current location revenue is a licensing business. It may be that licensing maps won’t ever be big enough. It has been commoditized, no matter how hard it still is (re: Apple Maps).

              Luckily that is not Nokia’s only target when it comes to location. Location-based advertizing for example seems to be a big one. That COULD be a huge business that isn’t still dominated by Google.

              • nn

                For advertising, first you need audience. By confining Nokia to the WP cage Elop guaranteed they will never have that. So regardless of what they develop it will not make money.

                Second, so far is just vague idea – like somebody spotted advertising on web and thought it would be good to sell ads in maps. Except nobody knows how to do it, let alone has working example. Google at least seems to be doing something and advertising is it’s core business, so if there is a way they will be the ones to take it first. But at Nokia so far it’s big talking.

                BTW, these hypes about how he will take on Facebook, Apple, Google or Samsung seems little bit delusional. Like as if he missed the focusing and leaning he brought upon Nokia, and still lives in the Symbian days of 2010 when Nokia was big, important and delivered products people were interested in.

                • Jyrki Sukula ottaa voiton Ramskista

                  It’s hard to get the audience with WP but what would have been the alternative in maps? Sell Symbian phones? Most of those were sold to markets where people are not using too much money for location services. Nokia was not that big in US or Europe, in high end.

                  Symbian was also a pretty dead end for selling location services.

            • correct

              You’re a fool. Over 1 Billion Euro in revenue just for the Location and Commerce Division is huge. Nokia is not in the business of ad revenue. So the fact that this money comes mainly from companies licensing the map data is a big win for Nokia. As explained, the Location division will only continue to grow.

              • correct

                Location and Commerce had a much bigger loss Q4 2011 compared to Q4 2012. The Location division is getting very close to making a profit.

              • Jyrki Sukula ottaa voiton Ramskista

                Over 1 billion of revenues? Apple did more than that with the App Store and it’s not a so important for Apple (in revenues and profits coming directly from apps) as location is for Nokia.

                One billion in revenues in a year is less than Lumia phones are making and people are constantly saying that it’s just a fraction of what Nokia should have.

                How much of those revenues come from Nokia? Part of it does come from Nokia’s other business units. Or did they change that?

                Location division may grow but how much and how much time it takes?

                Currently location revenues are more like a niche for Nokia.

          • nn

            It’s 278M euros. And the external sales number you conveniently omitted is increase from 200M to… 204M. Meaning that despite all the grand new agreements with Amazons of the worlds, sales are essentially flat. And by the outlook statements it’s going to get worse.

            In short they will not make money on licensing the raw data and SDKs.

      • correct

        You’re an idiot and a really bad troll. Michael Halbherr himself said that there is a price for the HERE data and a price for the SDK. We don’t know what kind of arrangement Nokia has with Microsoft, but we’re NOT talking about Microsoft’s use of Navteq data.

        • nn

          And the reason you don’t want to talk about MS and W8 is…? Of course I mean besides the fact it proves that licensing will not bring them much money, if any.

  • migo

    And this is why it would have been a bad idea for Nokia to go with Android.

  • john

    lol google maps r good at giving you direction on how to get ther but nokia live direction offline maps i find way better even more when your driving

  • ms.nokia

    “”In 2007 Nokia acquired US electronic navigation company Navteq for $8.1bn, and thus grabbed a profitable intellectual property licensing business. Early on, Nokia sold upgrades to its handset users for turn-by-turn driving navigation, but then Google offered this for free. Nokia touted downloadable global maps – and Google now offers this for free, too. It’s a competitive business.””

    thats why i loath google so much, they purposely use their add revenue to try and destroy different markets of its competitors,

    “”The mapping business at Nokia is doing very well today – bringing in €400m in the last quarter – making it a significant company in its own right, and growingly rapidly.””

    wish i had more noia stocks :)

    elop did say at mwc regarding making ‘here’ suite available on competing platforms…. “increase quantity, increase quality”

    • correct

      We can only hope that all the bad karma Google has built up around the world over the years will come back to bite them very hard. The signs are not good. Microsoft currently makes more money directly from Android through patent and license payments than Google itself does.

      Microsoft is still in court with Motorola over Android licensing fees. Motorola is the only known company that has not yet signed a licensing agreement with Microsoft over the patents they hold which relate to Android.

      Then of course Microsoft is also supporting Oracle in their case versus Google and Java use in Android. The initial rule sided with Google, but Oracle is in process of appealing, and Microsoft has joined the appeal.

      The EU has a very negative view on Google’s tactics, and is investigating them currently for a number of outrageous actions.

      Finally, we come to the biggest irony. A huge amount of the Android market in China is forked, with local Chinese no-name companies stripping all Google services off Android, adding their own services, and selling that on very cheap hardware as Android phones.

      That, and there is the big worry that Samsung may fork Android and make their own custom version of Android or drop Android completely. Either of those scenarios would be a huge loss for Google, as that would lead to a huge loss in ad revenue for Google.

      Google with their outrageous tactics in search, mapping, and with Android over the years has pissed off almost every major company in IT, and the mobile industry. The karma is going to hit them very hard soon.

      • Marc

        If you are talking about “karma”, then Microsoft will be dead long before Google.

        There is no IT company with the worse karma than Microsoft.

        • dss

          There is no such thing as a corporate karma… those things seem to be immune to it.

          • Leonard Pontuliosis

            Karma is question of what do you believe in. Some say it is, some say it isn’t, for persons, for organisations, for communities. I would say organisation can receive what they have deserved for.

        • correct

          Microsoft has repaid much of their karma. Google has yet to repay most of their karma.