The mission of Going Global, which appears on MidwestBusiness.com on most Tuesdays, is to educate and inform Midwest technology companies on what local technology companies are doing internationally so other firms can learn from the successes of like-minded peers.
CHICAGO – George Filley is the vice president of product management for Chicago-based NAVTEQ, which provides digital map data. His responsibilities include managing the firm’s current product portfolio as well as defining future products and services.
He sat down with MidwestBusiness.com to discuss international partners, expanding the company’s geographic footprint and personal privacy issues.
Michael Muth: Which international partners are most important to NAVTEQ? Why?
George Filley: It is segment specific. The automotive industry is our primary business from a revenue perspective.
For example, the car manufacturers provide a single system. It’s embedded. You would have to deal with system vendors as the provider of the system that is embedded in the device. At times, our organization will help to create the value chain. We work to create the middleware (the applications with developers).
We create an ecosystem to get a solution to the end user. The last thing we want to do is let our content not go anywhere. Internet portals are the ISPs. You can work directly with them. When dealing with device manufacturers, we work with those that don’t have location-aware technology.
We put them in touch with the chipset manufacturers so they can take advantage of our maps. Yahoo! is truly a great customer of ours. We try to get a clear understanding of what they’re trying to do and where they’re looking to go so we can provide a product they’re interested in using.
In Asia, it’s not as extensive as Europe, but we’ve grown our properties in Taiwan, South Korea, India, Australia and New Zealand. As our properties extend, the value we bring is from the standard look and feel. It’s logical our customers would look to us as a single source.
MM commentary: I’ve got to believe partnerships are vitally important to NAVTEQ because their databases are worth nothing without the hardware, network connections and content around them. NAVTEQ deals with Delco rather than Ford. They’ve obviously done a great job exploiting their partnerships.
MM: Where are you expanding your geographic footprint?
GF: Eastern Europe is one. In the fourth quarter of 2006, we launched Russia with coverage in Moscow and St. Petersburg. We’re building out from there. South Africa is a central point in Africa.
We’re expanding to the collar countries there. The Middle East is important to us along with Saudi Arabia, Dubai and Jordan in 2007. In South America, we’ve expanded our coverage in Brazil, Sao Paulo, Rio de Janiero and Belo Horizonte.
We’re creating a hybrid map between our entry map and a navigable map. We’ll provide blanket coverage with varying degrees of coverage later. We are expanding our entry map as well as navigational maps.
MM commentary: NAVTEQ’s CEO mentioned expanding their geographic footprint as a strategic imperative. Eastern Europe is obvious simply because many western Europeans are spending so much more time there now.
MM: How do you address personal privacy issues in Europe?
GF: The same issues are seen in America as well. There’s a difference between a device being location aware and that device’s location being made aware to a third party.
When you look at cell phones, the primary driver in the U.S. has been the e-911 issue. That’s different from transferring the information to a third party. Individuals make a decision to say “that’s OK”. When you talk about navigation, a customer opts in to the service. Even if the latitude and longitude are included in the data, it has to be an opt-in service.
It is a central concern that needs to be addressed. Individuals have choices (especially with number portability). If you spam me, I’ll leave. That activity is a deterrent for carriers to do that. Individuals do set preferences with filters. The privacy issue is a huge one that has to be addressed.
You’re putting so much stress on individuals being bombarded with information that it becomes a business problem. We’re talking about a revolution that’s occurring. GPS allows individuals to take advantage of the world around them. I’ve lived here all my life and I’ve only scratched the surface of what this city offers.
The enablement is incredible. There are exciting times ahead from a consumer-satisfaction point of view to find historical spots, sporting events, etc.
MM commentary: While I agree there are similarities in privacy issues, many Europeans (especially in Germany where I lived for a couple years) consider privacy differently than we do. I’m not sure we’ve addressed the issue as fully as they would require.
MM: Why so little revenues in Latin America and Asia?
GF: The concentration of our activities historically has been in Europe and North America. Our primary market was the in-vehicle navigation market. It started in 1985 or 1986. We started the company in 1985. The focus of those activities (outside Japan) was on Europe and North America.
As they matured, that’s where our revenues came from. Devices are all becoming location aware. At the recent Consumer Electronics Show (CES), they were all talking about making devices location relevant. There is every expectation that from a distribution standpoint it will reflect the distribution of these new devices.
MM commentary: While revenues from Asia are around 5 percent, the region seems poised for growth. Latin America seems to get lost in the search for growth markets.
MM: When will you address BRIC countries and add those languages to your Web site?
GF: We’re in more than 300 cities in China and growing to more than 700 cities by the end of 2007.
The economy there is booming. Everyone is using cell phones. Their automotive industry is churning out cars left and right. It’s a different business. A primary reason we did a joint venture there is because of the need for a local entity. It is a unique scenario to protect IP there.
MM commentary: In perusing NAVTEQ’s Web site, it wasn’t apparent that they offer content in those languages.
International Product Development
MM: How do the components of the NAVTEQ solution change from country to country?
GF: The holistic view of all the content we provide is customers can take advantage of all we offer or a subset of what we offer. Enterprises have added requirements for original content. It has less to do with the road network and more to do with points of interest and the textural or contextual information.
We need to decide what we gather ourselves or find someone there with content laying on top of the road network. The difference between countries is what lies beyond the road network. It goes to the core of navigation. We have a core understanding of what’s required to get from point “A” to point “B” and manage the changes that happen when you’re driving.
That requirement for common technology is wherever you go. A customer says: “I want to improve that by adding street signs.” Those are the differences between countries. The underlying road network is the same. We are a provider of a database. The differences are at the application level. That is at the heart of what our customers want.
We are bringing three-dimensional visualization to the market around the road network to see the Eifel Tower as a visual landmark. They are unique product differentiators. Depending on the device, they may have to utilize them a different way. The storage may be at the server. Our customer may need to make changes to take advantage of what we provide.
It’s at the device and application level where they make the solution sets. What do we need to include to serve the marketplace? With CDMA, they have an embedded GPS chip by design. It’s device centric versus infrastructure centric. GSM is moving toward chipset integration into their devices. They’re seeing the value in location awareness.
They could still utilize our database. They could still have our map of a city center and take advantage of the database to see what’s relevant around me. You can always get around technical barriers. It’s just another level of activity the individual or the application will have to do to get around it.
MM commentary: Because of rampant standardization, components of NAVTEQ’s solutions don’t change from place to place.
Michael Muth is managing director of GATA, an international business development consultancy that helps technology companies build international partnerships. He can be reached at email@example.com.
Click here for Muth’s full biography.
Previous Columns in 2007:E-Mail This Article to a Friend or Colleague
Q&A: George Filley of NAVTEQ in Chicago on Digital Mapping (3/7/2007)
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