Nokia killed free navigation, alleges EU complaint
The fall of Nav4All
A customer of the late Nav4All has filed a complaint with the EU, alleging that Nokia abused its market position to drive the competition out of business.
The complaint (pdf) points out that Nokia's acquisition of map-supplier Navtaq was approved on the basis that ongoing relationships would continue to exist. But according to the complaint, Nav4All was prevented from making its software compatible with competing suppliers, and received very little warning before its access to the Navtaq data was withdrawn.
Last January the EU investigated the acquisition of Navteq, by Nokia, and did identify a risk of Nokia controlling the supply of maps to competitors, pointing out that "Nokia and Navteq could foreclose [competitors] from the market of navigable digital map databases", but the report (pdf) goes on to conclude that Nokia/Navteq would have no incentive to withdraw maps from competitors as the loss of income would be considerable.
That investigation "only relates to foreclosure of competitors manufacturing mobile handsets", and goes on to explain that Nokia's limited presence in the mapping business means that the company wouldn't want to lose income from other licensees with whom it wasn't really competing.
But that was then, and now Nokia is very active in mapping applications - 1.4 million people downloaded Ovi maps in the first week it became free - and Nokia sees mapping as a way of differentiating its handsets. Nav4All was using the same dataset as Ovi Maps, but worked on competitors' handsets, so Nokia obviously had something to gain through the demise of Nav4All.
The existence of a motive doesn't prove anything, of course, but Navteq's requirement that Nav4All not use any competing data source provides more circumstantial evidence. According to the complaint Nav4All was told that continued use of Navteq maps required an obligation to use Navteq maps for its commercial service, once launched. That effectively prevented the company exploring alternatives before the plug was pulled.
The complaint does note these conditions were applied to all of Navteq's customers, but Nav4All reckons that with such a condition in place it was prevented from looking at competitors (which would be TeleAtlas, the industry being a duopoly) and was thus fatally exposed.
We've been in touch with both Nokia and Navteq, but neither company has got back to us with any comment so far: presumably still absorbing the substance of the complaint.
On a small scale there's not a lot of money at stake - even the complainant admits that at worst he'll lose €45 a year. But the proposition that Nokia drove a competitor out of business by buying up their only-available supplier is a serious allegation, and one that the EU may find itself obliged to investigate. ®
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