After Halbherr Departure What is the Future of HERE?

Yesterday Nokia announced the departure of HERE CEO Michael Halbherr.

Halbherr joined Nokia in 2006 as the CEO of Gate5, a small navigation software company acquired by the Finnish phone maker. This business unit became Nokia Maps then Location and Commerce (after NAVTEQ integration) and finally HERE since November 2012.

While the politically correct wording of the press release said he stepped down to “pursue his own entrepreneurial interests outside of the company,“ there were however some leaked comments stating there was a strategic disagreement between him and the new Nokia CEO Rajeev Suri.

The strategy disagreement might have been around the direct to consumer strategy, a move started with the launch of the new HERE brand in November 2012. Almost two years later it is clear that this consumer strategy has been a failure for the organization, consuming a lot of cash, time and resources.

As a matter of fact here.com has not become a consumer destination website, a bet which was bound to fail due to the massive visibility of Google Maps driven by both its superior user interface, responsiveness and technology and by its high exposure in Google’s search engine results.

The mobile applications for iOS and Android could have been an opportunity for HERE, especially to seze market share for iOS in the two months window between the failed launch of Apple Maps and the availability of Google Maps as a standalone app. But with no experience of app marketing HERE failed to gain top ranking and build awareness and downloads. Since then these iOS and Android apps have been retired and the HERE map is only available to the Windows Phone operating system and Nokia X.

HERE’s APIs for web and mobile developers have not been a success either.

Google and Openstreetmap

But even in business to business sales, licensing map data to Web and mobile companies has not been a success story despite a huge uplift in usage due to the rise of smartphones.

This is because the only customers to be won in this market segment are the big competitors to Google who have enough money to afford commercial map data: Amazon, Microsoft, MapQuest, Apple and a few others. Even in that field there is a strong competition from TomTom which won the Apple Maps contract and more recently all MapQuest map business, previously a customer of HERE.

The hundred of thousands of mobile and web developers on the market are either using Google Maps or relying on Openstreetmap if they wish more flexibility.

A big barrier for HERE in this developer arena, made of small and midsize companies, is its complex and lengthy licensing terms and conditions. 50 pages-long contracts are a good business for lawyers, certainly not for start-up companies.

Continued…

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