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  • Are Garmin And TomTom Toast? [View article]
    Garmin is a devices company with no content like maps and traffic. Where TomTom is a content company with maps and traffic, for whom devices are just one form factor to sell their content. Businesses and businessmodels differ very much. TomTom should be less afraid of smartphones, since they can carry their information as well.
    May 29 04:31 PM | 1 Like Like |Link to Comment
  • Are Garmin And TomTom Toast? [View article]
    I think you are missing I huge point.

    Garmin can be regarded as a hardware company. They make devices of all sorts. But they do not own the content, like maps, traffic information and points of interest. They source their maps from Nokia.

    TomTom is more of a content and services company. They are one of the three global mapmakers (together with Nokia and Google maps).

    The deals from TomTom with Apple, BlackBerry and Samsung are about licensing their content. Something Garmin cannot do, because they do not own the content.

    Garmin and TomTom will both move to partly different directions, where they can succeed.

    Garmin ill will keep trying to try broaden their revenue, away from carnavigation. Like sportswatches but also airplane cockpits.

    TomTom will focus on delivering their content and services to handset manufacturers like Apple, and carmanufacturers, like their current deals with Toyota and Mercedes.

    When comparing the two, Garmin has a better cash position. But TomTom is better positioned in the sense that hardware has more competitors than software and content. In content in the automotive industry they only have to compete with Nokia (and a bit of Google), but there are no other global mapmakers around.

    Also there's a possibility of an acquisition of TomTom by Apple, Samsung, BlackBerry or Microsoft, as maps are becoming an important part of ecosystems like iOS, windows mobile, BlackBerry or Tizen.
    May 29 04:31 PM | 7 Likes Like |Link to Comment
  • "There are only four sources of high-quality maps," Google, Waze, Navteq, and TomTom (TMOAF.PK), says Rolfe Winkler, and given Facebook's rumored $1B acquisition of Waze, TomTom may become an attractive takeover target for the likes of Apple (AAPL) and others who, while able to drive a hard bargain on map licensing fees, may prefer to bid for the Netherlands-based company rather than worry that a rival will acquire it. TomTom trades at an EV/EBITDA ratio of just 6x. (From December: Rabobank puts AAPL/TomTom odds at 30%) [View news story]
    As a longterm investor in TomTom I'd like to comment.

    Apple is now licensing data from TomTom as part of their maps offering, but they are also using other sources, differing per country. In the gps industry it is well known that Apple had problems in merging different data from different sources. Where TomTom data are accurate, Apple's are mostly not. It's not Apple's partners but Apple's lack of expertise that's part of the problem.

    Even Google says that maps are very hard to do well, and they've spent billions on maps for years (where Apple is just starting) so they should know.

    From what I've heard in the industry large corporations like Google, Apple, et all have difficulty partnering. Waze also claims large Silicon Valley firms need to learn to partner. They tend to (be a little arrogant) and do things on their own (or acquire technology) rather than depend on third parties for deep integration into their services.

    Also, I wouldn't call Waze a large global professional mapmaker. They're in this business for just a few years with limited resources and their maps are so-so at best. They don't own any mapping vans (like Google, TomTom and Nokia have) to check crowdsourced data and add additional information like speedlimits, roadmarkings, etc.

    I would say Google, TomTom and Nokia are the only THREE mapmakers on a global scale.

    I doubt TomTom's founders, who own 48% of the shares want to sell their company at the current marketcap or even 200% of that. They'd rather grow their business first.

    In a standalone scenario a bull scenario would be Apple acknowledging that maps is not their area of expertise and start to licence more services from tomtom. Not only some maps, but maps on a global scale and also their new routing software.
    May 19 07:47 PM | Likes Like |Link to Comment
  • "There are only four sources of high-quality maps," Google, Waze, Navteq, and TomTom (TMOAF.PK), says Rolfe Winkler, and given Facebook's rumored $1B acquisition of Waze, TomTom may become an attractive takeover target for the likes of Apple (AAPL) and others who, while able to drive a hard bargain on map licensing fees, may prefer to bid for the Netherlands-based company rather than worry that a rival will acquire it. TomTom trades at an EV/EBITDA ratio of just 6x. (From December: Rabobank puts AAPL/TomTom odds at 30%) [View news story]
    What makes TomTom interesting is their list of customers. Apple wants to be in cars. Acquiring TomTom means buying themselves into these carmakers.

    TomTom customers include: Apple, BlackBerry, Samsung, HTC, MapQuest, Mercedes, Toyota, Renault, Peugeot, Citroen, Audi, BMW, Opel, Lexus, Qoros (China), Mazda and Fiat.

    Some contracts with carmakers are already signed but delivery will be in the future when a specific model hits the market. Which means automotive revenue and ebit are not yet at their full potential, but expected to grow.

    Some of those car manufacturers are buying full tomtom systems, some are using 'components', like only maps and points of interest, routing software or traffic information. Check automotive.tomtom.com for more info.
    May 19 07:44 AM | 3 Likes Like |Link to Comment
  • "There are only four sources of high-quality maps," Google, Waze, Navteq, and TomTom (TMOAF.PK), says Rolfe Winkler, and given Facebook's rumored $1B acquisition of Waze, TomTom may become an attractive takeover target for the likes of Apple (AAPL) and others who, while able to drive a hard bargain on map licensing fees, may prefer to bid for the Netherlands-based company rather than worry that a rival will acquire it. TomTom trades at an EV/EBITDA ratio of just 6x. (From December: Rabobank puts AAPL/TomTom odds at 30%) [View news story]
    True
    May 19 07:44 AM | Likes Like |Link to Comment
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