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Summary

Recently, two major announcements in the mapping world have come from China, both with global implications. Baidu Maps has begun to roll out its services beyond China to the rest of the world, while Tencent and NavInfo – along with GIC from Singapore – have bought a stake in mapping-platform vendor HERE. Both Baidu and Tencent will look to increase their mapping footprint beyond China, so that they become global competitors to international players such as Google Maps and Apple Maps.

Baidu, Tencent go toe to toe with Google

In December 2016, it was announced that NavInfo, Tencent, and GIC intended to jointly purchase a 10% stake in HERE, a company owned by a German consortium of car manufacturers comprising Audi, Daimler, and BMW. The intended purchase will give Tencent and NavInfo mapping data to expand into global markets. It will also help HERE extend its services in China. Moreover, through the combination of data from NavInfo and autonomous driving solutions from HERE, Tencent can make a move into driverless cars.

Chinese search giant Baidu has already made inroads into the autonomous driving space with public trials in Wuzhen, China. The company has also stated its intention to test the cars on US roads and mass-produce driverless cars as early as 2020. This will place it in direct competition with established players such as Google, Tesla, and Uber. In a smaller foray, Baidu will launch its mapping service in 150 markets worldwide by partnering with HERE, which will again place it in competition with established players Google Maps and Apple Maps. Tencent and Baidu will need to be aggressive in their growth strategy and ensure their services have an international flavor to compete with the established players.

It is evident that Tencent and Baidu's goal of providing mapping solutions to consumers both in China and internationally is part of a long-term strategy which includes autonomous driving and even smart cities.

Mapping and navigation have evolved beyond standalone map apps used for directions and traffic information; they are rapidly being incorporated into the core of various consumer services, such as localized search, which can reveal local geographic and environmental information including weather, traffic, and pollution levels, providing more relevant, contextual, and intuitive services to the consumer. This year has begun on an exciting note for the mapping industry, and with Chinese tech giants entering international waters, expect interesting service developments from the incumbents in the mapping space.

Appendix

Further reading

Location Platform Index: Mapping and Navigation, 1H16, TE0003-000970 (October 2016)

Location-Based Services: Moving Beyond Mapping To Encompass the Digital World, TE0003-000862 (August 2015)

Location Services: HERE is looking to be the go-to provider for advanced mapping, TE0003-000813 (December 2014)

Location-Based M-commerce: Trends, Opportunities, and Challenges, TE0003-000766 (July 2014)

"Nokia is to sell mapping business HERE for €2.8bn," TE0003-000868 (August 2015)

"HERE continues push into the consumer market," TE0003-000844 (March 2015)

Author

Neha Dharia, Senior Analyst, Consumer Services

neha.dharia@ovum.com

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