One of the most intriguing stories right now is Apple's (NASDAQ:AAPL) "iLost Maps."
The introduction by Apple of its own mapping service in iOS6 has been one of its worst PR disasters. Although the update has brought voice-driven turn-by-turn navigation, users have complained that the new maps, which replace Google's - in use on the iPhone since 2007 - lack accuracy, clarity and detail.
In response, Apple said that "We launched this new map service knowing it is a major initiative and that we are just getting started with it. Maps is a cloud-based solution and the more people use it, the better it will get. We appreciate all of the customer feedback and are working hard to make the customer experience even better."
In other words, it knows that people aren't liking it. But it hasn't got a quick fix.
On June 12 TomTom signed a global agreement with Apple for maps and related information, but despite that problems still occur because Apple Maps still uses features of Google Maps that interfere with TomTom's maps.
Apple needs to put their cash into play and buy the technology to fix the problems. As mentioned in my article on February 22, 2011 TomTom (OTCPK:TMOAF) could be a perfect fit for Apple. TomTom's navigation solutions could be used immediately and a takeover would give Apple high amounts of navigation sector intellectual property.
TomTom designs and sells route navigation systems. The company is global market leader in the sales of portable navigation devices and is the world's leading provider of location and navigation solutions. In addition, hundreds of millions of people use TomTom's digital maps on the internet or mobile phone. The company's maps cover over 100 countries and are reaching more than 3 billion people.
The following points of interest makes TomTom and Apple a perfect fit:
TomTom HD Traffic was introduced in several countries, including the US and Canada. The unique combination of a real-time traffic service, HD Traffic and dynamic routing fits well with Apple's Traffic service in Apple Maps. TomTom HD Traffic is generated from a network of over 80 million probes. It covers up to 99.9% of the road networks and includes coverage of traffic jams on main roads as well as secondary and local roads. The system updates drivers with a complete and accurate overview of the situation on the road network every other minute.
Last year TomTom launched a local search app, TomTom Places, for the iPhone and for Android smartphones. Right now it is available in eight countries - Belgium, Denmark, Germany, Ireland, Norway, Portugal, Spain, Sweden and the Netherlands and supported in each of the local languages. The product enables users to search for shops, hotels, restaurants and tourist attractions and provides detailed information about their search results. The local search is based on TomTom's enhanced database of points of interest of 10 million establishments and provides directions to the destination while taking into account the current traffic situation. It is compatible with Apple Map's Local Search engine.
Apple could expand into fleet management. Last year TomTom became the fleet management services company with the largest customer base in Europe, and now has 15,000 individual customers and an installed base of 180,000 subscribers. The company introduced a number of new features during the year 2011, including Active Driver Feedback, WEBFLEET OptiDrive and the vehicle maintenance planning tool in WEBFLEET. All are focused on further improving the safety and efficiency benefits for businesses. Active Driver Feedback promotes safe driving by providing drivers with immediate feedback on their performance via their TomTom PRO navigation devices. WEBFLEET OptiDrive and vehicle maintenance planning give business management easy tools that help their drivers to drive more safely and in a more environmentally friendly way. WORKsmart-Eco helps companies to reduce fuel consumption and the CO2 emissions of their vehicle fleet.
TomTom is trading around EUR 3.78 on the NYSE Euronext Amsterdam. A takeover premium of around 70-80% is a realistic possibility if Apple would decide to buy TomTom. For around EUR 1.3-1.4 billion Apple could buy a state-of-the-art company that fixes their mapping problems and fits perfectly into their own innovation profile.