[A year ago, we set out to take a deep look at what we’re calling the mapping industry, a 50-year-old industry that operates more in the background than in the full light of day. We identified over 100 important vendors, from data suppliers such as PlaceIQ and Pitney Bowes to full-stack providers like Esri and HERE to application vendors such as Point Inside and Bird.i. We probed on how the industry works, the flow of data, and where the power lies. Long story short: The industry needs a major wave of disruption to unlock the power of location. Thanks to Emma Huff, a member of our research team, for composing this post.]
Our upcoming report, “Mapping’s Third Wave Will Unlock The Physical Future Of Business,” calls for significant changes in the industry, including massive vendor consolidation, a layered architecture to clarify the flow of value and money, and open, real-time access to the data powered by software. Throughout our 40-plus interviews, we observed various trends pointing to the future of mapping.
Trend No. 1: More Digital Businesses Are Waking Up To The Mapping Opportunity
Companies are mastering the digital realm, and they are beginning to bring that mastery to the real world of location intelligence, the internet of things, autonomous vehicles, and augmented reality. The challenge is that in order to build these physical-world applications, they need full access to the mapping stack. That’s why Uber broke from Google: to optimize its ride-sharing app and avoid buying mapping data and services from a ramping competitor. (Lyft still uses Google Maps.)
And it’s not just the big consumer platforms that need to control their own mapping value chain. For an enterprise, whether it be insurance, high tech, oil and gas, transportation, or financial services, your only option today is to download all the data, making it nearly impossible to integrate your own proprietary data and overlay algorithms to extract insights. That’s why BMW, Audi, and Mercedes-Benz invested in full-stack mapping vendor HERE — to have access to the data behind their in-car services and self-driving cars.
The importance of maps and location data to self-driving cars is clear. It’s also a great example of a broader principle: To turn data into intelligence into value, you must have access to the data. Wei Luo, founding chief operating officer of self-driving car map startup DeepMap, puts it succinctly: “If you don’t have data, you have nothing.”
Trend No. 2: Sharing Their Location Bothers Most European And American Consumers
Despite the uptick in firms’ use of mapping and location intelligence data, consumers aren’t thrilled to hear that their lives are being tracked from home to work and every stop along the way. Only a fraction of US and European consumers — 29% in the US and 25% in Europe (data from Forrester Analytics’ Consumer Technographics®) — agree that it’s okay for companies to track their location and send offers based on their trail. Firms, especially in the US and Europe, will need to tread carefully. In China, consumers are more willing to exchange location for convenience — 73% of them, in fact.
Trend No. 3: Mapping Vendors Are Moving Up The Stack To Build Applications That People Will Pay For
In our research, we heard over and over again that the real value is in the data. But most of the vendors we spoke to are struggling to make money off raw data and have instead created applications to stay afloat. They’ve had to identify real customer problems that they can address with mapping data — such as indoor routing for the visually impaired or monitoring real estate development sites.
These, among other trends, are indicative of massive shifts in the mapping industry. We’ve synthesized our research to make a bold suggestion to the industry: It’s time for open, real-time, cloud-scale mapping platforms to support the physical future of business. Tune in next week for more trends shaping the next evolution in mapping.
For more on how mapping data and platforms will power the physical future, see our last blog post here. Next week, we’ll talk about indoor positioning and the rampant commoditization of the lower layers of the mapping stack — which is ultimately good for everybody as standards prevail and data access improves.