To Boost Its Map Business, Nokia Invests in Smart Cars

What's next for Nokia, now that Microsoft owns its handset business? One new direction will be an investment of $100 million backing companies that are making cars more intelligent and connected -- and, in some ventures, making them driverless.

On Monday, the company revealed the plans by its venture capital fund, Nokia Growth Partners, which handles about $700 million for Nokia. A partner in the fund, Paul Asel, told Bloomberg Businessweek that "the car is really becoming a platform like when the mobile handset became a smartphone and all the apps and services developed around that."

The investment is built around Nokia's map business, which has become a mainstay of the handset-less company. In 2008, Nokia bought map provider Navteq and 3-D technology provider Earthmine. Nokia's map data is used by Amazon, Microsoft, Yahoo, and all but one of the five car navigation systems.

'Like a Windfall'

Avi Greengart, an analyst with industry research firm Current Analysis, told us that Nokia's three main lines of business now are wireless networking equipment, intellectual property and mapping. "So," he said, "if you're a mapping company, [smarter and] driverless cars are like a windfall."

In terms of driverless technology, Greengart said delivering on the promise is part of Nokia's challenge, as it is for Google, which has actively promoted its experiments and progress in the field.

Because of Nokia's reliance now on its mapping business as one leg of its three-legged stool, it needs to protect that business. "As Google pushes forward," Greengart said, "Nokia [needs to be able to] counterbalance that by putting up a bounty for anyone who's doing this" and isn't named Google. The search giant, of course, has its own extensive mapping business.

Last week, Google posted on its blog that it has improved the software on its driverless cars so that the vehicles can better...

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