Nokia vs. Google Platform Integration

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 |  Includes: AAPL, GOOG, GRMN, MSFT, NOK, TMOAF, VZ
by: Joel West

After spending $8 billion to buy Navteq and its mapping database, Nokia (NYSE:NOK) has now decided to give away the mobile navigation service with its various phones. Darla Mack describes the new service from the standpoint of Nokia handset users.

Of course, maps — fixed line, mobile, location aware (whether GPS or fixed line IP address), 3D, turn-by-turn navigation and every other incarnation — are a major strategic area for the Monster of Mountain View. As a friend noted last week, the location aware mapping services are probably the only category leading aspect of Google’s (NASDAQ:GOOG) Android platform right now.

And, in fact, Forbes remarks on the forthcoming battle between Nokia and Google. However, Forbes spends most of its time on the impact on TomTom (OTCPK:TMOAF) and Garmin (NASDAQ:GRMN) , which are already being substituted away by the Apple (NASDAQ:AAPL) and Google mobile phones. (Nokia is stronger than either the iPhone or Android in Europe, where Forbes reports that TomTom has 44% market share.)

Even if the mobile phone substitutes aren’t quite there yet, this is another milestone in the mobile-phone-as-the-Swiss-Army-knife-convergence-device view of the 21st century electronics industry. This highlights the direct and indirect competition between the various service and software platforms: Nokia is a hardware company that offers services, Google is a services company that now sells hardware, and both are providing handset software.

So it seems like another milestone away from open innovation, towards vertical integration (or related diversification), in which every platform owner feels it has to own every piece of the puzzle. That doesn’t count the network operators, who also want to rent their own mapping services. (The Verizon (NYSE:VZ) service comes in for caustic criticism by one of the Forbes readers.)

To me, Apple’s purported partnership to promote Bing (NASDAQ:MSFT) on its iPhone makes more sense than integration. My hunch is that Google and Nokia will still try to control every piece of the stack, even as Microsoft retreats away from mobile platforms into applications.