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So Why Did Apple Buy a Mapping Company?

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[qi:gigaom_icon_geolocation] Apple (s aapl) purchased digital mapmaker Placebase in July for an undisclosed sum, according to Seth Weintraub at Computerworld. Placebase, which we wrote about last year, is a Google (s goog) Maps competitor that focuses on adding layers of public and private data to existing maps with an easy-to-use API. One use for the product, called PolicyMap, layers various types of data — like home sales, crime or employment — over maps to help visualize data geographically. It’s big business, and the company was profitable without VC funding. So, why did Apple buy Placebase?

There are many reasons. For starters, it’s increasingly obvious that maps and geo-location are becoming crucial components of any modern operating system. Nokia was the first one to realize this and snapped up companies such as gate5 and Navteq.

Secondly, the acquisition allows Apple to decrease its reliance on former BFF Google. Apple could use Placebase’s technology to replace the Google Maps functionality in the iPhone and iPod touch (and the new tablet, perhaps?) with its an in-house mapping solution. The ongoing legal fight between Apple, Google and the FCC over rejected apps on the iPhone App Store is well-known, as is Google CEO Eric Schmidt’s departure from Apple’s board in August. 

Weintraub claims the Placebase purchase closed in July, which is a curious timeline. Did Schmidt know of Apple’s plans to purchase the company, or was this an instance of him “sitting out” of a board meeting, because it was a place where Apple and Google were possibly competing?

Apple and Google are competing on more and more fronts, and Apple may be looking to cut as many ties with Google as possible in a seemingly belated attempt at keeping the fox out of the henhouse. The highest profile tie at the moment? The Google search box currently sits at the top of every Safari user’s browser window — a search box that likely sends a decently substantial amount of referral funds from Google to Apple. Given Microsoft’s (s msft) need to expand its search share, it wouldn’t be inconceivable that Apple replaces Google with Bing. As long there is enough “cashback” for Apple!

24 Responses to “So Why Did Apple Buy a Mapping Company?”

  1. Johnny Mozzarella

    Helloooo! This is not about replacing Google maps on the iPhone.
    This is about creating a killer app for their TABLET!
    It will trickle down to the iPhone as well but the real mobile information mapping will happen on the tablet platform.

  2. You know I registered on this site as soon as I read the story. I input my home address and even with a nine digit zip the mapping had my location by more than 15 miles.

    Hopefully if this ever goes to mainstream deployment it will be more fine tuned.

  3. While I am a strong believer in the inevitability of Apple/Google evolving into Frienemies in the months ahead (see: The Chess Masters: Apple versus Google –, I think this is more a case of Apple adding geolocative DNA to their bench and continuing their innovation around the Maps app, which while powered by Google Maps under the under is nonetheless developed by Apple in terms of look, feel and supported workflows.

  4. love it love it love it
    Google is jumping to telephony and operating systems
    APPLE has semi conductors and now wants mapping application ( bye bye google maps).
    This is exciting for the tech industry.

    The three companies that can define the tech future are Google , Apple and Microsoft ( with support crew from Intel, Cicso)

    Good luck Microsoft.

    And SAMSUNG can copy them all !!!!

  5. Jacob Varghese

    I think this is ultimately less about replacing google maps and more about distinguishing themselves from every other phone that has a google maps app.

    Google maps has become a commodity.

    Overlaying valuable information on top of a map is a distinguishing feature.

  6. Anonymous

    I highly challenge the assertion that, “It’s big business, and the company was profitable without VC funding.” The company was, in fact, failing and on its last legs. The business model didn’t work, the technology didn’t scale and they were actively looking around for an exit before the whole thing went belly up. Do you even talk to others in the industry before writing this stuff? Resumes from employees of this company have been flying around for many, many months and discussions with employees very clearly indicated that they didn’t have enough customers to survive.

    Why did Apple buy them? They acquired some smart people for cheap. End of story.

  7. Anonymous

    What about video? YouTube’s exclusivity on the iPhone is a huge competitive advantage. All videos on the web must be in YouTube to be viewable on the iPhone. I’m sort of glad they haven’t started to support Flash.

    I’d love to see Apple buy Vimeo from IAC and make that the exclusive option. Better yet just support an open format anyone can develop for.

    • i think you have that backwards. google converted some of youtube from flash (a proprietary format) to h264 (an open format) JUST so that it’s viewable on the iPhone.

  8. smart purchase by apple looks like they want to become a US powerhouse when it comes to mobile services by slowly muscling out google and their offerings but finding a replacement for youtube will be tough I guess

  9. Geolocation and mapping are definitely becoming more important (don’t know if it ever wasn’t or if tech just needed to catchup). The problem with replacing Google with Bing is that the quality of Bing search results are still not at par. Furthermore – neither search engines are geared to real-time LBS services on a mobile device. Think there is room for another search engine in the market if it is able to get the Geolocation content can be integrated better?