Intel & Automotive – On the moov

Intel further broadens its position in digital transportation.

• Determined not to miss out on digital transportation the way it missed out on mobile, Intel is moving again to build a position and this time, I think it may be getting it right.
• On top of a series of other transactions, Intel has agreed to buy Moovit, a transit data and routing company for $900m.
• The immediate reaction is to question how this fits in with Mobileye (which Intel bought for $15.3bn in 2017), but I think Intel is thinking much more widely than just Mobileye.
• Moovit is best known as a public transportation app that helps users work out the best way to move around different cities incorporating all forms of transport and the added complexities that that entails.
• For example, driving a private vehicle or hire car requires parking data while a trip to the airport needs to take into account baggage requirements as well as terminal and check-in information.
• This has been a goal of many of the other mobility players and the key to it is not really technology but data.
• The data that is required to make a service really work comes from many incompatible sources and it is in the stitching together of this data into something meaningful is where the difficulties lie.
• This is not a direct fit with Mobileye but when takes into account Intel’s 15% ownership of HERE Technologies, its strategy becomes clearer.
• The digitisation of transportation is a very large opportunity and to ensure that Intel gets a high share of the silicon opportunity in vehicles it needs far greater influence than merely making semiconductors.
• This is where Mobileye comes in which started as a supplier of silicon and has since moved up the stack hoping to provide a robotaxi service of some description.
• HERE’s long-term strategy is to leverage its leading position in automotive maps to provide the platform and services that are required to offer location and transport-related services.
• This makes sense because thanks to Google, maps are quickly becoming a commodity with the real value migrating further up the stack into the software, the intelligence and the services that are based on it.
• This gives the map makers a head-start as a pre-requisite to providing these services is access to a high-quality map.
• The addition of Moovit increases Intel’s reach in transportation and I suspect there will be greater co-operation between its portfolio companies.
• For example, Moovit is currently using Open Street Map which would now make sense to migrate to HERE as well as to use HERE as a source for some of its location data.
• Intel will now have greater visibility into how transportation services are evolving giving it a better chance at supplying silicon as well as another route of monetisation further up the stack.
• Intel has made a mess of a lot of things, but its acquisition of Mobileye has gone well and while it is not yet paying its way, it is showing a lot of promise in the autonomous driving space.
• The addition of another transportation asset strengthens its position and further builds the coalition that is forming to compete with Google’s assumed dominance in this space.