Apple Maps – Wheel engineering

No need to reengineer the wheel.

• It looks like Apple along with Google and Samsung (see here) has also developed a case of engineering disease as it makes no sense whatsoever these days to build a map from scratch.
• It is no secret that Apple Maps has not been a stunning success.
• Outside of California and the US in particular, Apple Maps offers a third-rate experience which Apple has decided to address with a rebuild of its map.
• Apple appears to be under the impression that the problems with its map stems from the patch work of data suppliers that it has used to stitch together its map.
• Its solution is to throw the whole lot away and start again from scratch using its own vehicles equipped with Lidar and cameras as well as anonymised data from iPhones.
• Not surprisingly, the new map will roll out from California but how far from there it will get remains to be seen.
• This is because generating a map from scratch is an incredibly expensive business requiring 6,000 people and at least $600m of investment every year.
• Once Apple has generated the base layer it will have full flexibility in terms of updating the map and putting its own layers and data on top of it.
• The issue that I have with this strategy is two fold:
  • First, root of the problem: I do not think that using a series of different sources for its map is the root of Apple’s issues with its map.
  • I think that the base map that Apple has been using to date is good enough, the real problem is the quality of the layers and services that Apple has put on top of it.
  • These include points of interest, search, transit, driving directions, cycling, walking and so on.
  • These services are more about software and AI which is where I think most of Apple’s problems with its maps are to be found.
  • Being fully vertical integrated will give Apple all of the same types of advantages that it enjoys in its hardware products but I am far from convinced that it is necessary in this case.
  • Second, Neutral map available: When it comes to the base map, there is a very high quality supplier available that it not directly tied to any of Apple’s competitors.
  • This supplier is called HERE which was once Navteq and is owned by a consortium from the automotive and technology industries.
  • By most of the measures that Apple wants from its base map (completeness and freshness), HERE has plenty of evidence to show that it is a leader.
  • Furthermore, because HERE is not directly associated with any of Apple’s core competitors, I cannot see a strategic reason for Apple not to consider using HERE.
  • HERE is working with both Amazon and Facebook but these two have yet to really emerge as challengers to Apple particularly because it does not really compete in either Digital Life services or e-commerce.
• Hence, I can see no reason why Apple would reinvent the wheel other than it has decided that this is the way that it likes to do things.
• The end result will be a much more expensive product that takes much longer to come to market because map making is a lengthy process.
• Fortunately, investors will not really notice an extra $600m needlessly going out the door every year but this does raise a concern for me.
• This mindset could lead to really big mistake being made when it comes to the build vs buy choice that could harm the appeal of the iOS ecosystem.
• I see the early signs of engineering disease inside Apple but fortunately it does not have nearly as bad a case as either Samsung or Google whose affliction is having a significant impact on their respective outlook.
• One can only hope that it does not get worse.

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