TomTom: New Competition Everywhere!
Alan N. Hoffman
Bentley University and Rotterdam School of Management, Erasmus University
He thong ve tinh dinh vi toan cau
Synopsis
T o m T o m , an A m s t e r d a m - b a s e d c o m p a n y t h a t p r o -
vides n a v i g a t i o n services a n d devices, leads the n a v i -
gation systems m a r k e t i n E u r o p e a n d is second i n the
US. Its most p o p u l a r p r o d u c t s include T o m T o m G o
and T o m T o m One f o r cars, T o m T o m R i d e r f o r bikes,
T o m T o m N a v i g a t o r (digital maps), a n d T o m T o m f o r
iPhone—its most recent release.
The c o m p a n y attributes its m a r k e t leadership
to its technology, large customer base, d i s t r i b u t i o n
power, and p r o m i n e n t b r a n d image. B u t as the US
and European personal n a v i g a t i o n device m a r k e t
bao hoa
gets saturated, T o m T o m ' s sales g r o w t h rate declines.
The c o m p a n y also faces increasing c o m p e t i t i o n
f r o m other p l a t f o r m s using GPS t e c h n o l o g y like cell
phones a n d smart phones w i t h a b u i l t - i n naviga-
t i o n f u n c t i o n . Legal a n d e n v i r o n m e n t a l restrictions
o n the d i g i t a l n a v i g a t i o n i n d u s t r y m a k e T o m T o m ' s
future even m o r e u n c e r t a i n . W h e t h e r T o m T o m can
keep e x p a n d i n g may w e l l depend o n w h e t h e r i t can
become the p r i m e m o v e r i n creating d i g i t a l maps a n d
n a v i g a t i o n a l services f o r d e v e l o p i n g c o u n t r i e s .
TomTom: New Competition
Everywhere!
T o m T o m is one o f the largest producers o f satellite
n a v i g a t i o n systems i n the w o r l d , c o m p r i s e d o f b o t h
stand alone devices a n d a p p l i c a t i o n s . I t leads the
n a v i g a t i o n systems m a r k e t i n E u r o p e w h i l e stands
second i n the U n i t e d States. T o m T o m a t t r i b u t e s its
p o s i t i o n as a m a r k e t leader t o the f o l l o w i n g fac-
tors: the size o f its customer a n d t e c h n o l o g y base; its
The author would like to thank W i l l H o f f m a n , Mansi Asthana, Aakashi Ganveer, H i n g L i n , Che Yii for their research. Please address
all correspondence to Professor Alan N . H o f f m a n , Bentley Universiry, 175 Forest Street, Waltham, M A 02452; ahoffman@bentley.edu.
Printed by permission of Dr. Alan N . H o f f m a n .
(C180)
d i s t r i b u t i o n p o w e r ; a n d its p r o m i n e n t b r a n d image
and recognition. 19
thu mua nha sx, nha cc von duoc thue ngoai, tro thanh
1 phan sx noi bo, de dam bao gia tri chuoi cung ung
thu mua/sap nhap
W i t h the a c q u i s i t i o n o f Tele A t l a s , T o m T o m has
become v e r t i c a l l y i n t e g r a t e d a n d also c o n t r o l s the
m a p c r e a t i o n process n o w . T h i s has helped T o m T o m
establish itself as an i n t e g r a t e d c o n t e n t , service a n d
t e c h n o l o g y business. T h e c o m p a n y is D u t c h by o r i -
g i n a n d has its headquarters based i n A m s t e r d a m ,
N e t h e r l a n d s . I n t e t m s o f geography, the company's
o p e r a t i o n s span f r o m E u r o p e t o Asia Pacific, cover-
su mo rong tt
i n g N o r t h A m e r i c a , M i d d l e East a n d A f r i c a . cua Tom19
T o m T o m is s u p p o r t e d by a w o r k f o r c e o f 3,300
employees f r o m 4 0 countries. T h e diverse w o r k -
force enables the c o m p a n y t o compete i n interna-
t i o n a l m a r k e t s . T h e company's revenues have g r o w n
4
f r o m €8 m i l l i o n in 2 0 0 2 t o € 1 . 6 7 4 b i l l i o n i n 2 0 0 8 .
issue from investor
H o w e v e r , m o r e recently, because o f the Tele Atlas
a c q u i s i t i o n and the c u r r e n t economic d o w n t u r n the
c o m p a n y has become a cause o f concern f o r investors.
O n 2 2 n d July 2 0 0 9 , T o m T o m r e p o r t e d a f a l l o f 6 1 %
i n its net income at the end o f 2 n d quarter 2 0 0 9 . 3
T o m T o m is i n the business o f n a v i g a t i o n based
i n f o r m a t i o n services a n d devices. T h e c o m p a n y has
been i n v e s t i n g s t r u c t u r a l l y a n d strategically i n Re-
search a n d D e v e l o p m e n t t o b r i n g n e w a n d better
p r o d u c t s a n d services t o its customers. T h e c o m p a -
ny's belief i n r a d i c a l i n n o v a t i o n has helped i t r e m a i n
at the c u t t i n g edge o f i n n o v a t i o n w i t h i n the naviga-
t i o n industry. its vision
T h e v i s i o n o f T o m T o m is t o i m p r o v e people's lives
by t r a n s f o r m i n g n a v i g a t i o n f r o m a ' d o n ' t - g e t - l o s t so-
l u t i o n ' i n t o a t r u e t r a v e l c o m p a n i o n t h a t gets people
f r o m one place t o a n o t h e r safer, faster, cheaper and
better i n f o r m e d . T h i s v i s i o n has helped the c o m p a n y
t o be a m a r k e t leader i n every m a r k e t place i n the
satellite n a v i g a t i o n i n f o r m a t i o n services m a r k e t . 6
 Case 14: TomTom: New Competition Everywhere!

The objectives o f the c o m p a n y focus a r o u n d r a d - used i n T o m T o m Rider are user f r i e n d l y a n d come i n

ical advances i n three key areas: a v a r i e t y o f languages. 3

Better Maps: T h i s objective is achieved by m a i n t a i n -

ing T o m T o m ' s h i g h q u a l i t y m a p data base t h a t TomTom Navigator and TomTom Mobile
is c o n t i n u o u s l y kept u p t o date by a large c o m -
These a p p l i c a t i o n s p r o v i d e n a v i g a t i o n s o f t w a r e
m u n i t y o f active users w h o p r o v i d e corrections,
a l o n g w i t h d i g i t a l maps. B o t h o f these a p p l i c a t i o n s
verifications a n d updates t o T o m T o m . T h i s is
are c o m p a t i b l e w i t h m o s t mobiles a n d P D A s , p r o -
supplemented by i n p u t s f r o m T o m T o m ' s exten-
v i d e d by companies like Sony, N o k i a , Acer, D e l l a n d
sive fleet o f surveying vehicles. 6

HP. These a p p l i c a t i o n s c o m e w i t h T o m T o m H O M E
Better Routing: T o m T o m has the w o r l d ' s largest his-
w h i c h can be used t o upgrade t o the m o s t recent d i g -
t o r i c a l speed p r o f i l e data base I Q R o u t e s ™ fa-
i t a l maps a n d a p p l i c a t i o n versions. 3

cilitated by T o m T o m H O M E , the company's user

portal. 6

Better Traffic Information: T o m T o m possesses TomTom for iPhone

unique real t i m e traffic i n f o r m a t i o n service T o m -
O n A u g u s t 17, 2 0 0 9 , T o m T o m released T o m T o m f o r
T o m H D traffic™ w h i c h provides users w i t h h i g h
the iPhone. " W i t h T o m T o m f o r iPhone, m i l l i o n s o f
quality, real t i m e t r a f f i c updates. These three
6

iPhone users can n o w benefit f r o m the same easy-

objectives f o r m the base o f satellite n a v i g a t i o n ,
w o r k i n g in c o n j u n c t i o n t o help T o m T o m achieve
its mission.
TomTom's Products
T o m T o m offers a w i d e v a r i e t y o f p r o d u c t s r a n g i n g
to-use a n d i n t u i t i v e interface, t u r n - b y - t u r n spoken
navigation and unique routing technology that our
3 0 m i l l i o n p o r t a b l e n a v i g a t i o n device users rely o n
every day," said C o r i n n e V i g r e u x , M a n a g i n g D i r e c t o r
o f T o m T o m . " A s the w o r l d ' s leading p r o v i d e r o f n a v -
i g a t i o n solutions a n d d i g i t a l maps, T o m T o m is the
m o s t n a t u r a l f i t f o r a n advanced n a v i g a t i o n a p p l i c a -
t i o n o n the i P h o n e . " 6

f r o m p o r t a b l e n a v i g a t i o n devices t o s o f t w a r e n a v i -
T h e T o m T o m a p p f o r iPhone 3 G a n d 3GS users
gation applications a n d d i g i t a l maps. T h e u n i q u e
includes a m a p o f the US a n d Canada f r o m Tele A t l a s
features i n each o f these p r o d u c t s make t h e m t r u l y
a n d is available f o r $ 9 9 . 9 9 U S D .
"the smart choice i n personal n a v i g a t i o n . " Some o f 19

T h e T o m T o m app f o r iPhone includes the e x c l u -

these products are described b e l o w :
TomTom Go and TomTom One
These devices come w i t h a L C D screen t h a t makes
it easy to use w i t h fingertips w h i l e d r i v i n g . T h e y
provide 1,000 Points o f Interests (POI) t h a t help i n
locating p e t r o l stations, restaurants a n d places o f i m -
portance. A n u m b e r o f other POIs can also be d o w n -
loaded. Precise, u p t o m i n u t e t r a f f i c i n f o r m a t i o n , j a m
alerts a n d r o a d c o n d i t i o n alerts are p r o v i d e d by b o t h
these devices. 3
TomTom Rider
These are p o r t a b l e models especially f o r bikers. T h e
equipment consists o f an integrated GPS receiver t h a t
can be m o u n t e d o n any bike a n d a wireless headset
inside the helmet. Similar t o the car Portable N a v i -
g a t i o n Devices ( P N D s ) , the T o m T o m Rider models
have a n u m b e r o f P O I a p p l i c a t i o n s . T h e interfaces
sive I Q R o u t e s ™ technology. Instead o f using t r a v e l
t i m e assumptions, I Q Routes bases its routes o n the
actual experience o f m i l l i o n s o f T o m T o m drivers
t o calculate the fastest r o u t e a n d generate the most
accurate a r r i v a l times i n the i n d u s t r y . T o m T o m I Q
Routes e m p o w e r s drivers t o reach t h e i r d e s t i n a t i o n
faster u p t o 3 5 % o f the t i m e .
Company Background
Company History
T o m T o m was f o u n d e d as ' P a l m t o p ' i n 1 9 9 1 by Peter-
Frans Pauwels a n d Pieter Geelen, t w o graduates f r o m
A m s t e r d a m U n i v e r s i t y , N e t h e r l a n d s . P a l m t o p started
o u t as a s o f t w a r e d e v e l o p m e n t c o m p a n y a n d was
involved in p r o d u c i n g software for hand held com-
p u t e r s , one o f the m o s t p o p u l a r devices o f the 90s.
I n the f o l l o w i n g f e w years the c o m p a n y diversified
C182 Section A: Business-Level Strategy
into producing commercial applications including
software f o r personal finance, games, a d i c t i o n a r y
and maps. I n the year 1 9 9 6 , C o r i n n e V i g r e u x j o i n e d
P a l m t o p as the t h i r d partner. I n the same year, the
c o m p a n y announced the l a u n c h o f E n r o u t e a n d
RouteFinder, the first n a v i g a t i o n s o f t w a r e titles.
As more a n d m o r e people using PCs a d o p t e d M i -
crosoft's o p e r a t i n g system, the c o m p a n y developed
applications w h i c h were c o m p a t i b l e w i t h i t . T h i s
helped the c o m p a n y increase its m a r k e t share. T h e
year 2 0 0 1 m a r k s the t u r n i n g p o i n t i n the h i s t o r y o f
T o m T o m . I t was i n this year t h a t H a r o l d G o d d i j n ,
the f o r m e r C h i e f Executive o f Psion j o i n e d the c o m -
pany as the f o u r t h partner. N o t o n l y d i d P a l m t o p get
renamed t o T o m T o m , b u t i t also entered the satel-
lite n a v i g a t i o n m a r k e t . T o m T o m l a u n c h e d T o m T o m
N a v i g a t o r , the first m o b i l e car satnav system. Since
then, as can be seen i n E x h i b i t 1 , the c o m p a n y has
celebrated the successful l a u n c h o f at least a p r o d u c t
each year. 3 an e x a m p l e , t h e i r n a v i g a t i o n a l p r o d u c t s range f r o m
I n 2 0 0 2 , the c o m p a n y generated revenue o f
€8 m i l l i o n by selling the first GPS-linked car n a v i -
gator, the T o m T o m N a v i g a t o r t o P D A s . T h e u p -
graded v e r s i o n , N a v i g a t o r 2 was released i n early
2 0 0 3 . M e a n w h i l e , the c o m p a n y made efforts t o g a i n
technical a n d m a r k e t i n g personnel. T o m T o m t o o k
strategic steps t o g r o w its sales. T h e f o r m e r C T O o f
Psion, M a r k G r e t t o n , led the h a r d w a r e t e a m w h i l e
Alexander R i b b i n k , a former t o p marketing official
l o o k e d after sales o f n e w p r o d u c t s i n t r o d u c e d by
the company.
T o m T o m G o , an all i n one car n a v i g a t i o n system,
was the next m a j o r l a u n c h o f the c o m p a n y . W i t h
its useful a n d easy-to-use features T o m T o m G o was
included i n the list o f successful p r o d u c t s o f 2 0 0 4 .
I n the same year, the c o m p a n y launched T o m T o m
M o b i l e , a n a v i g a t i o n system w h i c h sat o n t o p o f
smartphones. 3 called ' A d v a n c e d integrated s o l u t i o n s ' t o " o p t i m i z e moi
T o m T o m c o m p l e t e d its I P O o n the A m s t e r d a m
Stock Exchange i n M a y 2 0 0 5 . I t raised € 4 6 9 m i l -
l i o n ( $ 5 8 7 m i l l i o n ) f r o m this offer. T h e net w o r t h o f
the c o m p a n y was nearly € 2 b i l l i o n after the I P O . A
m a j o r i t y o f the shares were w i t h the f o u r p a r t n e r s . 5 a n d o p t i m i z e routes a n d t o p r o v i d e detailed m a p p i n g
F r o m the years 2 0 0 6 t o 2 0 0 8 , T o m T o m strengthened
itself by m a k i n g three key strategic acquisitions.
D a t a f a c t o r y A G was a c q u i r e d t o p o w e r T o m T o m
W O R K t h r o u g h WEBfleet technology, w h i l e A p p l i e d
Generics gave its t e c h n o l o g y f o r M o b i l i t y Solutions
Services. H o w e v e r , the m o s t p r o m i n e n t o f these three
was the a c q u i s i t i o n o f Tele A t l a s .
5 vanced Integrated S o l u t i o n s . T o m T o m ' s last g r o u p
I n J u l y o f 2 0 0 7 , T o m T o m b i d f o r Tele A t l a s , a
c o m p a n y specializing i n d i g i t a l maps. T h e o r i g i n a l
b i d price o f € 2 b i l l i o n was c o u n t e r e d by a €2.3 b i l l i o n
o f f e r f r o m G a r m i n , T o m T o m ' s biggest r i v a l . W i t h
T o m T o m r a i s i n g the b i d price t o €2.9 b i l l i o n , the
t w o companies h a d i n i t i a t e d a b i d d i n g w a r f o r Tele
A t l a s . A l t h o u g h there was speculation t h a t G a r m i n
w o u l d f u r t h e r increase its b i d price, i n the end they
decided n o t t o pursue Tele A t l a s any further. Rather,
G a r m i n s t r u c k a c o n t e n t agreement w i t h N a v t e q . F i -
nally, T o m T o m ' s shareholders a p p r o v e d the takeover
i n December, 2 0 0 7 . 13
TomTom's Customers
T o m T o m is a c o m p a n y t h a t has a w i d e a r r a y o f cus-
tomers each w i t h t h e i r o w n i n d i v i d u a l needs a n d de-
sires. T o m T o m has a v a r i e t y o f p r o d u c t s t o meet the
requirements o f a large a n d v a r i e d customer base. As
$ 1 0 0 - $ 5 0 0 i n the U n i t e d States, r a n g i n g f r o m l o w e r
end p r o d u c t s w i t h fewer capabilities, t o h i g h end
p r o d u c t s w i t h advanced features.
T h e first g r o u p is the i n d i v i d u a l consumers w h o
b u y stand alone p o r t a b l e n a v i g a t i o n devices a n d ser-
vices. T h e second g r o u p is a u t o m o b i l e m a n u f a c -
turers. T o m T o m has teamed u p w i t h companies such
as R e n a u l t t o develop b u i l t - i n n a v i g a t i o n a l units t o
install as an o p t i o n i n cars. A t h i r d g r o u p o f c u s t o m -
ers is the a v i a t i o n i n d u s t r y a n d p i l o t s w i t h personal
planes. T o m T o m produces n a v i g a t i o n a l devices f o r air
t r a v e l at a f f o r d a b l e prices. A n o t h e r g r o u p o f c u s t o m -
ers is business enterprises. Business enterprises refers
t o companies such as W a l - M a r t , Target, o r H o m e -
D e p o t ; huge companies w i t h large m o b i l e - w o r k -
forces. T o focus o n these customers, T o m T o m f o r m e d
a strategic p a r t n e r s h i p w i t h a t e c h n o l o g y c o m p a n y
CN
business fleet o r g a n i z a t i o n a n d i t i n e r a r y p l a n n i n g o n
the T o m T o m p r o series o f n a v i g a t i o n devices". T h i s
n e w advanced feature o n P N D s offers ways f o r fleet
managers a n d r o u t e dispatchers t o organize, p l a n
i n f o r m a t i o n a b o u t the f i n a l d e s t i n a t i o n . " E v e r y day,
companies w i t h m o b i l e w o r k f o r c e s are challenged t o
direct a l l their people t o a l l the places they need t o
g o . O u r customers appreciate h a v i n g a central w e b
r e p o s i t o r y t o h o l d a n d manage a l l t h e i r l o c a t i o n a n d
address i n f o r m a t i o n , " says Scott W y a t t , C E O o f A d -
7
 Case 14: TomTom: New Competition Everywhere!

bao ve bo bien
of customers is the coast guards. T h e y are able t o
use Tom-Tom's m a r i n e n a v i g a t i o n a l devices f o r t h e i r
everyday responsibilities.
Mergers and Acquisitions
T o m T o m has made v a r i o u s mergers a n d acquisi-
tions as w e l l as partnerships t h a t have p o s i t i o n e d the
company w e l l . I n 2 0 0 8 T o m T o m a c q u i r e d a d i g i t a l
m a p p i n g c o m p a n y called Tele A t l a s . T h e a c q u i s i t i o n
has significantly i m p r o v e T o m T o m customers' user
experience a n d created other benefits f o r the c u s t o m -
ers a n d partners o f b o t h companies, i n c l u d i n g : m o r e
accurate n a v i g a t i o n i n f o r m a t i o n , i m p r o v e d cover-
age, a n d n e w enhanced features such as m a p updates
and I Q routes w h i c h w i l l be discussed i n the scarce/
unique resource section o f the paper. C o m m e n t i n g
on the p r o p o s e d Offer, A l a i n De Taeye, C o - f o u n d e r
and C E O o f Tele A t l a s said:
" . . .the T o m T o m - T e l e A t l a s p a r t n e r s h i p signals a
n e w era i n the d i g i t a l m a p p i n g i n d u s t r y . T h e com-
bination of Tom-Tom's customer feedback tools and
Tele A t l a s ' p i o n e e r i n g m a p p r o d u c t i o n processes a l -
l o w s Tele A t l a s t o d r a m a t i c a l l y change the w a y d i g i -
t a l m a p s are c o n t i n u o u s l y u p d a t e d a n d enhanced.
T h e result w i l l be a c o m p l e t e l y n e w level o f q u a l i t y ' ,
c o n t e n t a n d i n n o v a t i o n t h a t helps o u r p a r t n e r s de-
liver the best n a v i g a t i ovision
n products. This transaction
is n o t o n l y v e r y a t t r a c t i v e t o o u r shareholders but
demonstrates our l o n g s t a n d i n g mission
commitment to-
w a r d s all of our partners and customers t o deliver
the best d i g i t a l m a p p r o d u c t s a v a i l a b l e . " 1
T o m T o m has a c q u i r e d several patents f o r all o f
t h e i r d i f f e r e n t technologies. By h a v i n g these patents
f o r each o f its ideas, the c o m p a n y has protected itself
against its c o m p e t i t i o n a n d other companies t r y i n g
t o enter i n t o the m a r k e t . miss or vis or
objecttiev?
T o m T o m prides itself o n being the i n n o v a t o r i n its
i n d u s t r y a n d always being a step ahead o f the compe-
t i t i o n i n terms o f its technology. O n their Website they
say, " T o m T o m leads the n a v i g a t i o n i n d u s t r y w i t h the
technological e v o l u t i o n o f n a v i g a t i o n p r o d u c t s f r o m
static ' f i n d - y o u r - d e s t i n a t i o n ' devices i n t o products
a n d services t h a t p r o v i d e connected, d y n a m i c ' f i n d -
the-optimal-route-to-your-destination', w i t h time-
accurate t r a v e l i n f o r m a t i o n . W e are w e l l positioned
t o m a i n t a i n t h a t leading p o s i t i o n over the l o n g - t e r m
because o f the size o f o u r customer a n d technology
base, o u r d i s t r i b u t i o n power, a n d o u r p r o m i n e n t
b r a n d image a n d r e c o g n i t i o n . By being vertically i n -
tegrated a n d also c o n t r o l the m a p creation process
T o m T o m is i n a u n i q u e p o s i t i o n t o evolve i n t o an i n -
tegrated content, service a n d technology business."*
TomTom's has a strong b r a n d name/image. T o m -
T o m has positioned itself w e l l t h r o u g h o u t the W o r l d
as the leader i n portable n a v i g a t i o n devices. It markets
its products t h r o u g h its very user-friendly online Web-
site a n d also t h r o u g h large companies such as Best Buy
and W a l - M a r t . Recently T o m T o m teamed u p w i t h L o -
c u t i o Voice Technologies and T w e n t i e t h C e n t u r y Fox
Licensing & M e r c h a n d i s i n g t o b r i n g the o r i g i n a l voice
o f H o m e r Simpson t o all T o m T o m devices via d o w n -
l o a d . " L e t H o m e r Simpson be y o u r T o m T o m c o - p i l o t "
is just one o f the m a n y interesting way's T o m T o m mar-
kets its products and its name t o its consumers. 9

T o m T o m also f o r m e d a p a r t n e r s h i p w i t h a c o m -
pany called A d v a n c e d Integrated Solutions, a d d i n g
an i t i n e r a r y p l a n n i n g a n d r o u t e guidance feature
to the p r o series o f n a v i g a t i o n devices t o help b u s i -
nesses enterprises w i t h large m o b i l e - w o r k f o r c e s . A
few years ago they also p a r t n e r e d w i t h A v i s , a d d -
ing their user-friendly n a v i g a t i o n system t o a l l Avis
rental cars. T h i s p a r t n e r s h i p began i n E u r o p e a n d
recently the devices have made t h e i r w a y i n t o Avis
rental cars i n N o r t h A m e r i c a as w e l l m a n y o t h e r
countries where Avis operates. H a r o l d G o d d i j n , chief
executive officer o f T o m T o m c o m m e n t e d :
" A n y traveler can relate t o the stress o f a r r i v i n g i n
a n e w a n d u n f a m i l i a r c i t y a n d g e t t i n g h o r r i b l y lost,
w i t h the a v a i l a b i l i t y o f the T o m T o m G O 7 0 0
bringing unbeatable, full feature car
s t r a i g h t i n t o the h a n d s o f A v i s c u s t o m e r s . "
Internal factors
TomTom's Resources and Capabilities
T h e c o m p a n y believes t h a t there are three f u n d a -
mentals t o a n a v i g a t i o n s y s t e m — d i g i t a l m a p p i n g ,
r o u t i n g t e c h n o l o g y a n d d y n a m i c i n f o r m a t i o n . Based
o n these requirements three key resources can be
i d e n t i f i e d t h a t really d i s t i n g u i s h e d T o m T o m f r o m its
competition.
T h e first o f these resources is t h e i r in-house rout-
thuat toan
ing algorithms. These a l g o r i t h m s enable t h e m t o
i n t r o d u c e technologies l i k e — I Q Routes, t h a t p r o -
vides " c o m m u n i t y based i n f o r m a t i o n database." I Q
Routes calculate y o u r routes based o n the real aver-
we're age speeds measured o n roads at t h a t p a r t i c u l a r t i m e .
navigation T h e i r Website says, " T h e smartest route h o u r - b y -
2
hour, d a y - b y - d a y , saving y o u t i m e , m o n e y a n d f u e l . " 5
 Section A: Business-Level Strategy
The second unique resource identified was Tele-
Atlas and the digital mapping technology t h a t the
T o m T o m g r o u p specializes i n . H a v i n g the technology
and knowledge i n m a p p i n g that the company b r o u g h t
t o T o m T o m , has a l l o w e d t h e m t o introduce m a n y
unique features t o their customers. Firstly, T o m T o m
recently came o u t w i t h a m a p update feature. T h e
company recognizes that roads a r o u n d the w o r l d are
constantly changing and because o f this they used the
technology to come o u t w i t h f o u r new maps each year,
one per business quarter. This allows their customers
t o always have the latest routes t o incorporate i n t o
their everyday travel. A second feature they recently i n -
troduced is their MapShare p r o g r a m . The idea behind
this is that customers o f T o m T o m w h o notice mistakes
in a certain m a p are able t o go i n and request a change
be made. The change is then verified and checked d i -
rectly by T o m T o m and is shared w i t h the rest o f their
global user c o m m u n i t y . " O n e and a half m i l l i o n m a p
corrections have been submitted since the launch o f
T o m T o m M a p Share™ i n the summer o f 2 0 0 7 . " '
The t h i r d u n i q u e resource i d e n t i f i e d w a s auto-
motive partnerships w i t h t w o companies i n p a r t i c u -
lar; Renault a n d Avis. A t the end o f 2 0 0 8 , T o m T o m
reached a deal w i t h R e n a u l t t o offer its n a v i g a t i o n
devices installed i n t h e i r cars as an o p t i o n . A n article
in A u t o - w e e k magazine said the f o l l o w i n g a b o u t the
deal. " R e n a u l t developed its n e w l o w - c o s t system i n
partnership w i t h A m s t e r d a m - b a s e d t e c h n o l o g y c o m -
pany T o m T o m , the E u r o p e a n leader i n p o r t a b l e n a v -
i g a t i o n systems. T h e system w i l l be a n alternative t o
the existing satellite n a v i g a t i o n devices i n Renault's
upper-end cars." T h e catch here is the n e w price o f
8
the b u i l t i n n a v i g a t i o n u n i t s . T h e cost o f a n a v i g a -
t i o n device installed i n Renault's cars before T o m -
T o m was € 1 , 5 0 0 . N o w w i t h T o m T o m system i t costs
o n l y € 5 0 0 . As t a l k e d a b o u t earlier i n the paper, T o m -
T o m also partnered w i t h Avis back i n 2 0 0 5 t o offer
its n a v i g a t i o n devices, specifically the m o d e l G O 7 0 0
i n a l l Avis rental cars, first s t a r t i n g i n E u r o p e a n d
e x p a n d i n g i n t o other countries w h e r e Avis operates.
Competitor in 5 force factors
Competition Facing TomTom
Traditional Competition
T o m T o m faces c o m p e t i t i o n f r o m t w o m a i n c o m p a -
nies. The first o f these is G a r m i n w h i c h holds 4 5 %
o f the m a r k e t share, b y far t h e largest a n d d o u -
ble T o m - T o m ' s m a r k e t share ( 2 4 % ) . G a r m i n w a s
founded i n 1989 by Gary Burrell and M i n H . Kao.
T h e c o m p a n y is k n o w n f o r their on-the-go directions
since its i n t r o d u c t i o n i n t o GPS n a v i g a t i o n i n 1 9 8 9 .
A t the end o f 2 0 0 8 , G a r m i n reported a n n u a l sales o f
$ 3 4 9 3 . 1 m i l l i o n . Last year G a r m i n competed head-to-
head w i t h T o m T o m i n t r y i n g t o acquire Tele-Atlas f o r
their m a p m a k i n g . G a r m i n w i t h d r e w their b i d w h e n
it became evident t h a t i t was becoming t o o expense
t o o w n Tele-Atlas. G a r m i n executives made a deci-
sion t h a t i t was cheaper t o w o r k o u t a l o n g - t e r m deal
w i t h its c u r r e n t supplier t h a n t o t r y t o b u y o u t a c o m -
petitor. G a r m i n ' s c u r r e n t supplier f o r m a p services is
N a v t e q w h i c h was also acquired by N o k i a i n 2 0 0 8 .
T h e second direct c o m p e t i t o r is M a g e l l a n , w h i c h
holds 1 5 % o f the m a r k e t share. M a g e l l a n is p a r t o f
a p r i v a t e l y held c o m p a n y u n d e r the name o f M i T a c
D i g i t a l C o r p o r a t i o n . Similar t o G a r m i n , M a g e l l a n
p r o d u c t s use N a v t e q based maps. M a g e l l a n was the
creator o f M a g e l l a n N A V 1 0 0 t h a t was the w o r l d ' s
first c o m m e r c i a l h a n d h e l d GPS receiver w h i c h w a s
created i n 1989. T h e c o m p a n y is also w e l l k n o w n f o r
t h e i r a w a r d - w i n n i n g R o a d M a t e a n d M a e s t r o series
p o r t a b l e car n a v i g a t i o n systems.
Together these three d o m i n a n t players account
f o r a b o u t 8 5 % o f the t o t a l m a r k e t . O t h e r c o m p e t i -
t o r s i n t h e personal n a v i g a t i o n device m a r k e t are:
N a v i g o n , Nextar, and N o k i a . N a v i g o n and Nextar
c o m p e t e i n t h e personal n a v i g a t i o n devices w i t h
T o m T o m , M a g e l l a n , a n d G a r m i n w h o are t h e t o p
three i n t h e i n d u s t r y . B u t N a v i g o n competes i n the
h i g h - e n d segment w h i c h retails f o r m o r e t h a n any
o f the c o m p e t i t o r s b u t offer a f e w extra features i n
t h e i r P N D s . N e x t a r c o m p e t e i n the l o w - e n d m a r k e t
a n d its strategy is l o w cost. F i n a l l y , N o k i a is m e n -
t i o n as a c o m p e t i t o r i n this i n d u s t r y because they
recently a c q u i r e d N a v t e q w h o is a m a j o r supplier o f
m a p services i n this i n d u s t r y . A l o n g w i t h t h a t , N o k i a
has a b i g m a r k e t share i n t h e cell p h o n e i n d u s t r y
a n d plans o n i n c o r p o r a t i n g GPS t e c h n o l o g y i n every
p h o n e m a k i n g t h e m a p o t e n t i a l key player t o l o o k at
f o r i n the GPS n a v i g a t i o n i n d u s t r y .
New Competition
Cell Phones Cell phones are a w i d e l y used technology
by people a l l a r o u n d the w o r l d . W i t h the 2 0 0 5 F C C
m a n d a t e t h a t requires the l o c a t i o n o f any cell phone
used t o call 9 1 1 , p h o n e m a n u f a c t u r e r s have n o w
i n c l u d e d GPS receiver i n a l m o s t every cell phone.
 Case 14: TomTom: New Competition Everywhere!
Due t o this m a n d a t e , cell p h o n e m a n u f a c t u r e r s a n d
cellular services are n o w able t o offer a GPS naviga-
t i o n services t h r o u g h the cell p h o n e f o r a fee.
ATT Navigator GPS N a v i g a t i o n w i t h A T & T N a v i g a -
tor a n d A T & T N a v i g a t o r G l o b a l E d i t i o n feature
real-time GPS enabled t u r n - b y - t u r n n a v i g a t i o n o n
A T & T m o b i l e Smartphones (iPhone a n d B l a c k b e r r y )
or static n a v i g a t i o n a n d L o c a l Search o n a non-GPS
A T & T mobile Smartphone.
A T T N a v i g a t o r features G l o b a l GPS t u r n - b y - t u r n
n a v i g a t i o n — M a p p i n g a n d P o i n t o f Interest c o n t e n t
for three continents, i n c l u d i n g N o r t h A m e r i c a (U.S.,
Canada, a n d M e x i c o ) , Western E u r o p e , a n d C h i n a
where wireless coverage is available f r o m A T & T o r
its r o a m i n g p r o v i d e r s . T h e A T T N a v i g a t o r is sold as
a subscription service a n d costs $ 9 . 9 9 per m o n t h .
Online Navigation Applications O n l i n e n a v i g a t i o n
Websites t h a t are still p o p u l a r a m o n g s t m a n y us-
ers f o r d r i v i n g directions a n d maps are M a p Q u e s t ,
Google M a p s , a n d Y a h o o M a p s . Users are able t o
use this free site t o get d e t a i l directions o n h o w t o
get t o their next d e s t i n a t i o n . I n today's e c o n o m i c
d o w n t u r n m a n y people are l o o k i n g f o r cheap, o r i f
possible free solutions t o solve their p r o b l e m s . These
online Websites offer the use free m a p p i n g a n d n a v i -
gation i n f o r m a t i o n t h a t w i l l a l l o w t h e m t o get w h a t
they need at n o a d d i t i o n a l costs. H o w e v e r , there are
down-sides t o these p r o g r a m s , " s u c h as they are n o t
portable a n d m a y have p o o r v i s u a l i z a t i o n designs
(such as vague image, o r t e x t - b a s e d ) . " 12
Built-in Car Navigation Devices I n car n a v i g a t i o n de-
vice first came a b o u t i n m o r e l u x u r y , h i g h - e n d
xu huong
vehicles. I n today's m a r k e t i t has become m o r e m a i n -
stream a n d n o w being o f f e r e d i n m i d t o l o w e r tier
vehicles. These b u i l t - i n car n a v i g a t i o n devices offer
similar features t o t h e personal n a v i g a t i o n device
kha nang cam tay
but d o n ' t have the p o r t a b i l i t y so y o u w o n ' t have t o
chi phi khong lo
carry m u l t i p l e devices b u t come w i t h a hefty cost.
Some examples o f these are K e n w o o d , Pioneer, a n d
Eclipse units a l l installed i n t o y o u r car. These units
tend t o be expensive a n d over-priced because o f the
fact t h a t they are b r a n d name p r o d u c t s a n d require
physical i n s t a l l a t i o n . For e x a m p l e , the t o p o f the line
Pioneer u n i t is $ 1 , 0 0 0 f o r the m o n i t o r a n d t h e n a n -
other $ 5 0 0 f o r the n a v i g a t i o n device plus the p h y s i -
cal labor. W h e n b u y i n g such p r o d u c t s , a customer is
spending a huge a m o u n t o f m o n e y o n a p r o d u c t t h a t
is a l m o s t i d e n t i c a l t o a p r o d u c t T o m T o m offers a t
significantly l o w e r prices.
Physical Maps Physical maps have been t h e p r i m a r y
o p t i o n f o r n a v i g a t i n g f o r decades u n t i l t e c h n o l o g y
came a r o u n d . Physical maps p r o v i d e d e t a i l r o a d
i n f o r m a t i o n t o help a person get f r o m p o i n t A t o
p o i n t B. A l t h o u g h c u m b e r s o m e t o use t h a n some o f
the m o d e r n t e c h n o l o g y alternatives, i t is a n alterna-
tive f o r people w h o are n o t technically savvy o r f o r
w h o m n a v i g a t i o n device is a n unnecessary l u x u r y
t h a t they d o n o t feel the need t o spend m o n e y o n .
PL - macro factors
Potential Adverse Legislation
and Restrictions
I n t h e legal a n d p o l i t i c a l r e a l m , T o m T o m is f a c i n g
t w o issues t h a t are n o t c r i t i c a l n o w , b u t m a y have
significant r a m i f i c a t i o n s t o n o t o n l y T o m T o m i n t h e
f u t u r e , b u t also t h e entire p o r t a b l e n a v i g a t i o n d e -
vice i n d u s t r y . T o m T o m ' s reactions t o each o f these
issues w i l l d e t e r m i n e w h e t h e r o r n o t there is a n o p -
p o r t u n i t y f o r g a i n o r a t h r e a t o f a significant loss
w i l l occur.
T h e m o s t i m p o r t a n t issue deals w i t h the possible
legislative b a n n i n g o f a l l n a v i g a t i o n a l devices f r o m
a u t o m o b i l e s . I n A u s t r a l i a , there is g r o w i n g concern
over t h e d i s t r a c t i o n caused by P N D s a n d t h e legis-
lature has t a k e n the steps t o w a r d b a n n i n g these de-
vices e n t i r e l y f r o m a u t o m o b i l e s . T h e r e is a s i m i l a r
26
sentiment i n O n t a r i o , C a n a d a w h e r e a l a w t h a t is
currently under review w o u l d b a n a l l PNDs that
were n o t m o u n t e d either t o the d a s h b o a r d o r t o the
windshield itself. 27
W i t h the increase i n legislation a d d i n g t o the r e -
strictions placed o n P N D devices, the t h r e a t t h a t the
P N D m a r k e t i n t h e f u t u r e w i l l be severely l i m i t e d
c a n n o t be i g n o r e d . A l l o f the c o m p a n i e s w i t h i n t h e
P N D i n d u s t r y , n o t just T o m T o m , m u s t create a c o -
o r d i n a t e d a n d u n i t e d e f f o r t t o stem this t i d a l w a v e
o f restrictions as w e l l as p r o v i d e reassurance t o t h e
p u b l i c t h a t they are also concerned w i t h the safe use
o f t h e i r p r o d u c t s . A n e x a m p l e o f this o p p o r t u n i t y
comes f r o m t h e t o y i n d u s t r y w h e r e safety regula-
t i o n s are fast a n d f u r i o u s a t times. M a n y companies
w i t h i n t h e t o y i n d u s t r y have c o m b i n e d t o f o r m t h e
I n t e r n a t i o n a l C o u n c i l o f T o y I n d u s t r i e s t o be proac-
23
tive i n regards t o safety regulations as w e l l as l o b b y
 Section A: Business-Level Strategy
governments o n behalf the t o y i n d u s t r y against laws
that may u n f a i r l y threaten the t o y i n d u s t r y . 23
The other issue w i t h i n the legal a n d p o l i t i c a l
spectrum t h a t T o m T o m m u s t focus o n is the g r o w -
ing use o f GPS devices as t r a c k i n g devices. C u r r e n t l y ,
law enforcement agents are a l l o w e d t o use t h e i r o w n
GPS devices t o t r a c k the movements a n d locations
of individuals they deem t o be suspicious, b u t h o w
long w i l l i t be before budget cuts reduce the access t o
these GPS devices a n d t h e n the simple s o l u t i o n w i l l
be to use the P N D devices already installed i n m a n y
automobiles?
This issue also requires the i n d u s t r y as w h o l e t o
proactively w o r k w i t h the consumers a n d the gov-
giai phap than thien
ernment t o come t o an amicable r e s o l u t i o n . T h e
threat o f h a v i n g every consumer's GPS i n f o r m a t i o n
at the finger tips o f either the g o v e r n m e n t o r sur-
veillance c o m p a n y w i l l m o s t c e r t a i n l y s t u n t o r even
completely halt any g r o w t h w i t h i n the P N D i n d u s t r y
and t h a t is w h y the i n d u s t r y m u s t be o n the offensive
and n o t become a reactor.
A n o t h e r a l a r m i n g t r e n d is the rise i n P N D thefts
around the c o u n t r y . W i t h the prices f o r P N D s at
22
a relatively high level, thieves are t a r g e t i n g vehicles
that have visible d o c k i n g stations f o r P N D s either
on the d a s h b o a r d o r w i n d s h i e l d . T h e onus w i l l be
on T o m T o m t o create n e w designs t h a t w i l l help n o t
only hide P N D s f r o m w o u l d - b e thieves b u t also de-
ter t h e m f r o m ever t r y i n g t o steal one. Consumers
w h o are scared t o purchase P N D s because o f this
rise i n c r i m e w i l l become an issue i f this p r o b l e m is
not resolved.
There is also a t r e n d c u r r e n t l y t h a t is labeled the
G R E E N m o v e m e n t , t h a t aims t o reduce any a c t i v i -
29
ties t h a t w i l l endanger the e n v i r o n m e n t . T h i s m o v e -
ment is a great o p p o r t u n i t y f o r T o m T o m t o t o u t its
technology as the smarter a n d m o r e e n v i r o n m e n t a l l y
safe t o o l i f d r i v i n g is a n absolute necessity. N o t o n l y
can i n d i v i d u a l s t o u t this i m p r o v e d efficiency, b u t
more i m p o r t a n t l y o n a larger scale, businesses t h a t
require large a m o u n t s o f materials t o be t r a n s p o r t e d
across l o n g stretches can s h o w activists t h a t they t o o
are w o r k i n g t o b e c o m i n g a green c o m p a n y .
I t is i r o n i c t h a t t h e core t e c h n o l o g y used i n T o m -
Tom's n a v i g a t i o n system, the GPS system, is p r o l i f -
erating i n t o o t h e r electronic devices at such a r a p i d
pace t h a t i t is causing serious c o m p e t i t i o n t o t h e
P N D i n d u s t r y . GPS f u n c t i o n a l i t y is v i r t u a l l y a re-
q u i r e m e n t f o r a l l n e w s m a r t p h o n e s t h a t enter t h e
m a r k e t a n d s o o n w i l l become a basic f u n c t i o n a l i t y
i n r e g u l a r c e l l u l a r phones. T o m T o m w i l l be h a r d
pressed t o c o m p e t e w i t h these m u l t i f u n c t i o n a l
devices unless they c a n i m p r o v e u p o n t h e i r de-
signs a n d t r a n s f o r m themselves i n t o j u s t a single
focused device.
A n o t h e r concern n o t o n l y f o r T o m T o m , b u t f o r
every c o m p a n y t h a t relies heavily o n GPS t e c h n o l -
ogy, is the a g i n g satellites t h a t s u p p o r t the GPS
system. A n a l y s t s p r e d i c t t h a t these satellites w i l l be
either replaced o r f i x e d before there are a n y issues,
but this issue is u n s e t t l i n g due t o the fact t h a t T o m -
T o m has n o c o n t r o l over i t . T o m T o m w i l l have t o
2 4
devise c o n t i n g e n c y plans i n case o f catastrophic f a i l -
ure o f t h e GPS system m u c h like w h a t happened t o
Research i n M o t i o n w h e n m a l f u n c t i o n i n g satellites
caused d i s r u p t i o n i n t h e i r service.
C u r r e n t l y T o m T o m is o n e o f t h e l e a d i n g c o m -
panies i n t h e P N D m a r k e t s i n b o t h E u r o p e a n d
the U n i t e d States. A l t h o u g h t h e y are the leader i n
E u r o p e , t h a t m a r k e t is s h o w i n g signs o f b e c o m i n g
s a t u r a t e d , a n d even t h o u g h t h e U.S. m a r k e t is cur-
rently g r o w i n g , T o m T o m should n o t w a i t f o r the
i n e v i t a b l e signs o f t h a t m a r k e t ' s s l o w d o w n as w e l l .
T o m T o m needs t o be p r o a c t i v e t o t h e n e x t b i g mar-
k e t instead o f u s i n g its large resources t o become a
fast follower.
T h e t w o m a i n o p p o r t u n i t i e s f o r T o m T o m t o ex-
p a n d , c r e a t i n g d i g i t a l maps f o r d e v e l o p i n g countries
and creating n a v i g a t i o n a l services c a n either be p i g -
g y b a c k e d one o n t o p o f each other o r can be t a k e n
i n i n d e p e n d e n t paths. T h e first-mover advantage f o r
these o p p o r t u n i t i e s w i l l erect a h i g h b a r r i e r o f entry
for a n y companies t h a t d o n o t have large a m o u n t s o f
resources t o invest i n the d e v e l o p i n g c o u n t r y . T o m -
T o m is already p l a y i n g c a t c h - u p t o G a r m i n a n d their
already established service i n I n d i a . Being proactive
is a n i m p o r t a n t a n d valuable o p p o r t u n i t y t h a t T o m -
T o m s h o u l d take advantage o f .
G l o b a l i z a t i o n o f any c o m p a n y ' s p r o d u c t s does
not come w i t h o u t a c e r t a i n set o f issues. F o r T o m -
T o m , t h e m a i n t h r e a t b r o u g h t o n by f o r e i g n c o u n -
tries is t w o f o l d . T h e first t h r e a t w h i c h m a y be an
isolated instance, b u t c o u l d also be repeated i n m a n y
o t h e r c o u n t r i e s is the r e s t r i c t i o n o f c e r t a i n c a p a b i l i -
ties f o r a l l o f T o m T o m ' s p r o d u c t s . D u e t o security
and t e r r o r i s m concerns, GPS devices are n o t a l l o w e d
i n E g y p t since 2 0 0 3 . I n these times o f g l o b a l terror-
28
ism T o m T o m m u s t be v i g i l a n t o f the g r o w i n g t r e n d
for countries t o become o v e r l y p r o t e c t i v e o f foreign
companies a n d t h e i r technologies.
 Case 14: TomTom: New Competition Everywhere!
Internal Environment
Finance
TomTom's c u r r e n t financial objectives are t o diver-
sify and become a broader revenue based c o m p a n y .
The c o m p a n y n o t o n l y seeks t o increase the revenue
base i n terms o f geographical e x p a n s i o n b u t also
wants t o diversify its p r o d u c t a n d service p o r t f o l i o .
A d d i t i o n a l l y , another i m p o r t a n t goal the c o m p a n y
strives t o achieve is t o reduce its o p e r a t i n g expenses.
Sales Revenue and Net Income I n E x h i b i t 2 i t c a n be
observed t h a t f r o m 2 0 0 5 t o 2 0 0 7 there is a consis-
tent g r o w t h i n sales revenue a n d a c o r r e s p o n d i n g
increase i n net i n c o m e t o o . H o w e v e r , year 2 0 0 8 is
an exception t o this t r e n d . I n this year sales revenue
decreased by 3 . 7 % a n d the net i n c o m e decreased
by 1 3 6 % . I n fact, i n the first q u a r t e r the net i n c o m e
is actually negative t o t a l i n g - € 3 7 m i l l i o n . T h e de-
crease i n sales c a n be accounted b y the d o w n t u r n
in the economy. A c t u a l l y , a c c o r d i n g t o t h e i r 2 0 0 8
annual r e p o r t , the sales are i n line w i t h t h e i r expec-
tations f r o m the m a r k e t . H o w e v e r , the net i n c o m e
p l u m m e t e d m u c h m o r e t h a n the decrease i n sales.
This was actually triggered b y its a c q u i s i t i o n o f a
digital m a p p i n g c o m p a n y — T e l e A t l a s , w h i c h w a s
funded by b o t h cash assets a n d debt.
1 . Q u a r t e r l y sales—In second q u a r t e r o f 2 0 0 9
T o m T o m received sales revenue o f € 3 6 8 m i l -
l i o n c o m p a r e d t o € 2 1 3 m i l l i o n i n first q u a r t e r
and € 4 5 3 m i l l i o n i n the same q u a r t e r last year.
( E x h i b i t 3) By e v a l u a t i n g q u a r t e r l y sales f o r a
three year p e r i o d f r o m 2 0 0 7 t i l l present, i t is ap-
parent t h a t the sales d o f o l l o w a seasonal t r e n d
in T o m T o m . W i t h highest sales i n last q u a r t e r
and lowest i n the first quarter. H o w e v e r , f o -
cusing o n just the first a n d second q u a r t e r f o r
three years one c a n infer t h a t the sales revenue
as a w h o l e is also g o i n g d o w n year after year.
To investigate f u r t h e r o n the causes o f this sce-
n a r i o w e w i l l have t o delve deeper i n t o its rev-
enue base. T o m T o m ' s sources o f revenue c a n be
b r o a d l y g r o u p e d i n t o t w o categories—market
segment a n d geographic l o c a t i o n .
Revenue per segment: T o m T o m ' s per seg-
ment revenue stream c a n be d i v i d e d i n t o P N D s
and others, where others consist o f services
and content. E v a l u a t i n g first quarter o f 2 0 0 8
against t h a t o f 2 0 0 9 a n d last quarter o f 2 0 0 8 ,
T o m T o m experienced steep decline o f 4 0 % a n d
6 8 % . ( E x h i b i t 4) T h i s c o u l d be a consequence o f
c o m p o u n d e d effect o f the f o l l o w i n g — F i r s t l y , the
n u m b e r o f devices ( P N D s ) decreased by a similar
a m o u n t b o t h the t i m e periods. A n d secondly, the
average selling price o f P N D s has also been de-
creasing consistently. I n a technology c o m p a n y a
decrease i n average selling price is a p a r t a n d par-
cel o f d o i n g business i n a h i g h l y c o m p e t i t i v e a n d
d y n a m i c m a r k e t place. Nevertheless, the revenue
stream f r o m business units other t h a n P N D s has
seen a steady increase i n b o t h the scenarios.
Revenue per region: T o m T o m ' s per r e g i o n
revenue stream c a n be f u r t h e r d i v i d e d i n t o E u -
r o p e , N o r t h A m e r i c a a n d t h e rest o f the w o r l d .
C o m p a r i n g first q u a r t e r o f 2 0 0 9 against 2 0 0 8
it c a n be seen t h a t , revenue f r o m b o t h E u r o p e
and N o r t h A m e r i c a are o n decline, w i t h a de-
crease o f 2 2 % a n d 5 2 % respectively ( E x h i b i t 5 ) .
A t the same t i m e , revenue f r o m rest o f the w o r l d
has seen a huge increase o f 9 0 % . B o t h o f these
analyses s u p p o r t T o m T o m ' s c u r r e n t objective t o
increase t h e i r revenue base a n d is aligned w i t h
their l o n g - t e r m strategy o f being a leader i n nav-
igation industry.
2. L o n g t e r m d e b t — I n 2 0 0 5 T o m T o m w a s cash-
r i c h c o m p a n y b u t the recent a c q u i s i t i o n o f Tele
Atlas w h i c h amounted t o €2.9 billion and was
f u n d e d b y cash, release o f n e w shares as w e l l as
l o n g t e r m debt, w h i c h is i n this case a b o r r o w -
ing o f € 1 . 2 b i l l i o n . C u r r e n t l y , T o m T o m ' s debt is
€1,006 million.
3. O p e r a t i n g M a r g i n — T o m T o m saw a consis-
t e n t increase i n o p e r a t i n g m a r g i n t i l l 2 0 0 6
( e x h i b i t 7). B u t since 2 0 0 7 o p e r a t i n g m a r g i n has
been decreasing f o r the firm. I n fact, b y the end
o f 2 0 0 8 i t came d o w n t o 1 3 % c o m p a r e d t o 2 6 %
in 2 0 0 6 .
Marketing
T r a d i t i o n a l l y h i g h q u a l i t y a n d ease o f use o f solu-
tions have been o f u t m o s t i m p o r t a n c e t o T o m T o m .
I n 2 0 0 6 , i n a n interview, T o m T o m ' s M a r k e t i n g H e a d
A n n e Louise H a n s t a d , c o u l d n o t have emphasized
m o r e o n the i m p o r t a n c e o f s i m p l i c i t y a n d ease o f
use o f t h e i r devices. ( H a n s t a d ) T h i s underlines the
T o m T o m ' s belief t h a t — " P e o p l e prefer fit f o r purpose
devices t h a t are developed a n d designed t o d o one
specific t h i n g very w e l l . " A t t h a t t i m e b o t h o f these
(C188) Section A: Business-Level Strategy
were core t o the T o m T o m ' s strategy as t h e i r targeted
customers were early adopters, b u t n o w as naviga-
t i o n i n d u s t r y has m o v e d f r o m e m b r y o n i c t o a g r o w t h
industry T o m T o m ' s c u r r e n t customers are early ma-
jority, and hence, s i m p l i c i t y a n d ease alone c o u l d n o
longer p r o v i d e i t w i t h c o m p e t i t i v e advantage.
Recently, t o be i n line w i t h its i m m e d i a t e goal o f
diversifying i n t o d i f f e r e n t m a r k e t segment, T o m T o m
is more focused o n strengthening its b r a n d n a m e . I n
December 2 0 0 8 , T o m T o m ' s C E O s t a t e d — " . . .we
are constantly s t r i v i n g t o increase awareness o f o u r
b r a n d and strengthen o u r r e p u t a t i o n f o r p r o v i d i n g
smart, easy-to-use, h i g h - q u a l i t y p o r t a b l e n a v i g a t i o n
products and services." 19
A l o n g w i t h Tele A t l a s the g r o u p has g a i n e d
the d e p t h a n d b r e a d t h o f expertise over the last
30 years, a n d t h i s makes i t a t r u s t e d b r a n d . T h r e e
o u t o f f o u r people are a w a r e o f the b r a n d o f the
T o m T o m business across the m a r k e t s . T h e T o m -
T o m g r o u p has a l w a y s been c o m m i t t e d t o three
fundamentals of n a v i g a t i o n — m a p p i n g , r o u t i n g
a l g o r i t h m a n d d y n a m i c i n f o r m a t i o n . Tele A t l a s '
core competency is the d i g i t a l m a p p i n g database
a n d T o m T o m ' s is r o u t i n g a l g o r i t h m s a n d g u i d a n c e
services u s i n g d y n a m i c i n f o r m a t i o n , a n d the g r o u p
together create synergies t h a t enable t h e m t o i n t r o -
duce p r o d u c t s a l m o s t every year a d v a n c i n g o n one
o r a c o m b i n a t i o n o f these three elements. A c q u i r i n g
t h e i r l o n g t i m e s u p p l i e r o f d i g i t a l m a p s , Tele A t l a s ,
i n 2 0 0 8 gives t h e m an edge w i t h i n - h o u s e d i g i t a l
mapping technology.
T o m T o m provides a range o f P N D devices l i k e —
T o m T o m O n e , T o m T o m X L a n d T o m T o m G o Series.
Periodically, i t tries t o enhance those devices w i t h
new features and services, t h a t they b u i l d based o n
the feedback f r o m customers. Examples o f services
a r e — I Q routes a n d L I V E services. W h i l e I Q routes
provides drivers w i t h the m o s t efficient r o u t e p l a n -
n i n g ; a c c o u n t i n g f o r situations as precise as speed
bumps and traffic l i g h t s , L I V E services f o r m s a range
o f i n f o r m a t i o n services delivered d i r e c t l y t o the L I V E
devices. The L I V E services b u n d l e includes M a p
Share and H D T r a f f i c — t h a t is b r i n g i n g the c o n t e n t
collected f r o m vast d r i v i n g c o m m u n i t y d i r e c t l y t o
the end user.
These products a n d services accentuate effective
designs a n d unique features, a n d require T o m T o m t o
w o r k along w i t h its customers t o share precise u p -
dates and also get feedback f o r f u t u r e i m p r o v e m e n t s .
Hence, effective customer i n t e r a c t i o n becomes
essential t o its l o n g t e r m goal o f i n n o v a t i o n . I n 2 0 0 8 ,
J.D. Power associates recognized T o m T o m f o r p r o -
v i d i n g o u t s t a n d i n g customer service experience. 18
A l t h o u g h , i t a w a r d e d T o m T o m f o r customer service
satisfaction, J.D. Power a n d associates r a n k e d Gar-
m i n highest i n o v e r a l l customer satisfaction. T o m -
T o m f o l l o w e d G a r m i n i n the r a n k i n g , p e r f o r m i n g
w e l l i n the r o u t i n g , speed o f system a n d voice direc-
tion factors. 16
As m e n t i o n e d previously, w h e n the n a v i g a t i o n
i n d u s t r y was still i n its e m b r y o n i c stages—Features,
ease o f use a n d h i g h q u a l i t y o f its solutions gave
T o m T o m p r o d u c t s a c o m p e t i t i v e edge. Eventually,
the c o m p e t i t i o n increased i n the n a v i g a t i o n i n d u s t r y
a n d even substitutes pose substantial threat t o m a r k e t
share n o w . C u r r e n t l y , T o m T o m offers P N D s i n differ-
ent price ranges, b r o a d l y classified i n t o — h i g h - r a n g e
a n d m i d - r a n g e P N D s , w i t h an average selling price o f
€ 9 9 . There are entry-level o p t i o n s t h a t a l l o w a savvy
shopper t o p u t n a v i g a t i o n i n his/her car f o r just over
$ 1 0 0 . H i g h e r - e n d models a d d advanced features and
services previously described.
T o m T o m sells its P N D s t o consumers t h r o u g h re-
tailers a n d d i s t r i b u t o r s . A f t e r a c q u i r i n g Tele A t l a s i t
is strategically placed t o g a i n the first m o v e r a d v a n -
tage created by its r a p i d e x p a n s i o n o f geographical
c o v e r a g e . T h i s is o f key i m p o r t a n c e w h e n i t comes
19
t o increasing the g l o b a l m a r k e t share.
T o m T o m directs its m a r k e t i n g e x p e n d i t u r e t o -
w a r d s B2B a d v e r t i s i n g t h a t is direct t o retailers and
d i s t r i b u t o r s . T o m T o m also invested i n an o f f i c i a l
b l o g Website as w e l l as search o p t i m i z a t i o n w h i c h
places i t i n p r e m i u m results i n o n l i n e searches. This
has enabled T o m T o m t o d o effective w o r d - o f - m o u t h
p r o m o t i o n w h i l e k e e p i n g flexible m a r k e t i n g spend-
i n g , i n accordance t o changes i n the m a c r o e c o n o m i c
e n v i r o n m e n t o r seasonal t r e n d s . A l t h o u g h , this
19
a p p r o a c h gives i t spending f l e x i b i l i t y , i t lacks a d i -
rect B2C a p p r o a c h . C u r r e n t l y o n l y 2 1 % US adults
o w n P N D s w h i l e 6 5 % US adults neither o w n nor
use n a v i g a t i o n . By n o t spending o n B 2 C m a r k e t i n g
14
T o m T o m is d i s c o u n t i n g o n the o p p o r t u n i t y b o t h to
attract first-tier noncustomers a n d glean an insight
o f needs o f second-tier noncustomers. " 1
Operations
T h e focus o f o p e r a t i o n s has a l w a y s been o n i n n o v a -
t i o n . M o r e recently, T o m T o m ' s o p e r a t i o n a l objective
is t o c h a n n e l a l l the resources a n d core capabilities
 Case 14: TomTom: New Competition Everywhere!
to create economies o f scale so as t o be a l i g n e d w i t h
their l o n g t e r m strategy. T o m T o m aims t o focus a n d
centralize R & D resources t o create scale econo-
mies t o c o n t i n u e t o lead the i n d u s t r y i n terms o f
innovation. 19
I m p l e m e n t a t i o n o f this strategy is w e l l u n d e r w a y
and the changes are visible. By second q u a r t e r o f
2009 m i d - r a n g e P N D s were i n t r o d u c e d w i t h capa-
bilities f r o m high-range devices, 5 0 % o f P N D s were
s o l d w i t h I Q Routes Technology, first in-dash p r o d -
uct was also launched i n alliance w i t h R e n a u l t a n d
T o m T o m iPhone a p p l i c a t i o n was also a n n o u n c e d . 19
A f t e r a q u i r i n g Tele A t l a s , t o better s u p p o r t the
broader n a v i g a t i o n solutions a n d c o n t e n t a n d ser-
vices, the g r o u p u n d e r w e n t r e s t r u c t u r i n g . N e w o r g a -
nization structure consists o f f o u r business units, t h a t
have clear focus o n a specific customer g r o u p a n d are
supported by t w o shared d e v e l o p m e n t centers.
T o m T o m ' s supply c h a i n a n d d i s t r i b u t i o n m o d e l is
outsourced. T h i s increases T o m T o m ' s a b i l i t y t o scale
up or d o w n the supply c h a i n , w h i l e l i m i t i n g c a p i t a l
expenditure risks. B u t , at the same t i m e , i t depends
on a l i m i t e d n u m b e r o f t h i r d parties a n d i n c e r t a i n
instances sole suppliers, f o r c o m p o n e n t s u p p l y a n d
m a n u f a c t u r i n g , w h i c h increases its dependency o n
these suppliers.
T o m T o m ' s d y n a m i c c o n t e n t s h a r i n g m o d e l uses
high q u a l i t y d i g i t a l maps a l o n g w i t h the connected
services, like H D T r a f f i c , L o c a l Search w i t h G o o g l e
and weather i n f o r m a t i o n , provides o u r customers
w i t h relevant real-time i n f o r m a t i o n at the m o m e n t
they need i t , a n d this is h e l p i n g t h e m deliver the
benefits o f i n n o v a t i v e t e c h n o l o g y d i r e c t l y t o the end
user and t h a t t o n o w at a f f o r d a b l e prices. A l t h o u g h ,
the n e t w o r k externalities p r e v i o u s l y m e n t i o n e d are
one o f the advantages o f T o m T o m ' s L I V E , i t has also
TOMTOM
GROUP TOMTOM TELE ATLAS
B2C B2B
-> Consumers PND
-> Automotive
-> Mobile
-> Internet
-> GIS
DYNAMIC CONTENT & PUBLISHING
SHAREDTECHNOLOGIES
increased T o m T o m ' s dependency o n the n e t w o r k o f
the connected d r i v i n g c o m m u n i t y . Bigger the net-
w o r k w i l l be, the m o r e effective w o u l d be the i n f o r -
m a t i o n f r o m the guidance services.
F u r t h e r m o r e , i n order t o reduce o p e r a t i n g expenses
a n d strengthen the balance sheet, undue emphasis has
been placed o n the cost c u t t i n g p r o g r a m . C u r r e n t l y the
cost reductions are made u p o f — R e d u c t i o n o f staff,
Restructuring and i n t e g r a t i o n o f Tele A t l a s , Reduced
discretionary spending and R e d u c t i o n in the n u m b e r
o f contractors a n d M a r k e t i n g spenditures. H o w e v e r ,
if n o t exceuted wisely i t c o u l d hamper T o m T o m ' s
long t e r m objective o f being a m a r k e t leader. For ex-
ample one o f the core capabilities o f any technology
c o m p a n y is its staff; reducing i t can hinder future i n -
novative projects. L i k e w i s e , reducing the m a r k e t i n g
expenditures i n a m a r k e t w h i c h still holds rich pros-
pects o f high g r o w t h . There are still 6 5 % o f US adults
w h o d o n ' t o w n any k i n d o f n a v i g a t i o n system either a
device, o r in-car, o r t h a t o f p h o n e . 14
Human Resources
L i k e any o t h e r t e c h n o l o g y c o m p a n y success o f i n -
d i v i d u a l employees is very i m p o r t a n t t o T o m T o m .
A d d i t i o n a l y , T o m T o m has a v i s i o n t h a t success f o r
T o m T o m as a business s h o u l d also mean success f o r
the i n d i v i d u a l employee. T h e r e f o r e , at T o m T o m , e m -
ployee competency is t a k e n very seriously a n d talent
d e v e l o p m e n t p r o g r a m s are b u i l t a r o u n d i t . There is
a personal n a v i g a t i o n p l a n t h a t provides employees
w i t h a selection o f courses based o n competencies i n
their p r o f i l e . I n 2 0 0 8 T o m T o m c o m p l e t e d its Y o u n g
Talent D e v e l o p m e n t P r o g r a m w h i c h was a i m e d at
b r o a d e n i n g the p a r t i c i p a n t s ' k n o w l e d g e , w h i l e i m -
p r o v i n g t h e i r technical a n d personal skills.
WORK AUTOMOTIVE
B2B B2B
-> Commercial -> Car industry
fleets -> Car industry
suppliers
 Section A: Business-Level Strategy
T o m T o m ' s m o t t o is t o d o business efficiently,
p r o f i t a b l y as w e l l as responsibly. T h i s underlines its
corporate social responsibility. T o m T o m ' s headquar-
ters is one o f the most energy efficient b u i l d i n g s i n
A m s t e r d a m . As m e n t i o n e d before, earlier n a v i g a t i o n
was oriented t o w a r d s m a k i n g the drivers a r r i v e t h e i r
their destintion w i t h o u t g e t t i n g lost. T o m T o m was
the pioneer i n i n t r o d u c i n g d i f f e r e n t t e c h n o l o g y t h a t
actually helps drivers t o make t h e i r j o u r n e y s safer
and more e c o n o m i c a l . T h i s shows t h e i r c o m m i t m e n t
to their customer base as w e l l as t o the c o m m u n i t y
as a w h o l e .
Issues of Concern for TomTom
First, T o m T o m is f a c i n g increasing c o m p e t i t i o n
f r o m other p l a t f o r m s using GPS technology. T w o
m a i n areas t h a t come t o m i n d are cell phones a n d
smartphones. I n the cell p h o n e i n d u s t r y , N o k i a is
leading the charge i n c o m b i n g cell p h o n e t e c h n o l -
ogy w i t h GPS technology. T h e y have a p l a n t o p u t
GPS t e c h n o l o g y i n a l l t h e i r phones. A r o u n d the same
t i m e T o m T o m a c q u i r e d Tele A t l a s , N o k i a also pur-
chased N a v t e q , a c o m p e t i t o r t o Tele A t l a s . W i t h the
a c q u i s i t i o n o f N a v t e q , N o k i a hopes t o shape the cell
phone i n d u s t r y by m e r g i n g cell p h o n e , i n t e r n e t , a n d
GPS technology together.
As w e see the S m a r t p h o n e i n d u s t r y emerging
w i t h the IPhone and the P a l m Pre, w e also see a s h i f t
in h o w people are able t o utilize these technologies
as a n a v i g a t i o n t o o l . A b i g t r e n d i n smartphones
Exhibit 1 Company history
Founded Renamed Navcore
1991 2001 2003
1996 2002
s t
1 PDA Navigator
these days are a p p l i c a t i o n s . Because o f the ease o f
d e v e l o p i n g s o f t w a r e o n p l a t f o r m s f o r smartphones,
m o r e a n d m o r e c o m p e t i t o r s are c o m i n g t o the f o r e -
f r o n t a n d d e v e l o p i n g GPS n a v i g a t i o n a p p l i c a t i o n .
F o r T o m T o m , b o t h o f these sectors m i g h t sig-
nal m a j o r change is i n the h o r i z o n a n d t h a t there is
n o longer a need f o r h a r d w a r e f o r GPS n a v i g a t i o n
devices. A n d t h a t w e ' r e h e a d i n g t o w a r d s a c u l t u r e
w h e r e consumers w a n t a n a l l - i n - o n e device such as
cell phone o r S m a r t p h o n e t h a t w i l l d o e v e r y t h i n g
they need i n c l u d i n g a GPS n a v i g a t i o n services. I n a
recent study done by Charles G o l v i n f o r Forrester, he
believes t h a t by 2 0 1 3 phone-based n a v i g a t i o n w i l l
d o m i n a t e the i n d u s t r y . A n d the reason is due t o Gen
Y a n d Gen X customers w h o are increasingly reliant
o n t h e i r m o b i l e phone a n d w h o w i l l d e m a n d social
n e t w o r k i n g a n d other connected services integrated
i n t o t h e i r n a v i g a t i o n experience . 14
T h e other p r o b l e m T o m T o m is f a c i n g is a m a t u r e
US & E u r o p e a n personal n a v i g a t i o n device m a r k e t .
A f t e r 3 years o f steady g r o w t h i n the P N D m a r k e t ,
T o m T o m has seen decreasing g r o w t h rate f o r P N D
sales. There c o u l d be m a n y factors t h a t are causing
this such as the w o r l d w i d e recession b u t w e felt t h a t
base o n sales figure w e ' r e seeing the same t r e n d i n the
US m a r k e t as w e have seen i n the E u r o p e a n m a r k e t
for T o m T o m . I n i t i a l l y e n t e r i n g the E u r o p e a n m a r k e t
12 m o n t h s before e n t e r i n g the US m a r k e t , T o m T o m
has seen 2 1 % d i p i n sales f o r the E u r o p e a n m a r k e t .
A l t h o u g h , T o m T o m experiences some g r o w t h i n the
US m a r k e t f o r 2 0 0 8 , they are n o t i c i n g the g r o w t h
rate has n o t been as g o o d as the p r i o r years.
HDTraffic &
IPO MapShare
2005 2007
2004 2006 2008
TomTom WORK & Teleatlas
GO Mobility
Solutions
 Case 14: TomTom: New Competition Everywhere!

Exhibit 1 (continued)

Year Historical Event

1991 Palmtop founded by Harold Goddijn, Peter-Frans Pauwels and Pieter Geelen
1994 Corinne Vigreux joined the Company to sell Palmtop applications in Europe.
1996 First navigation software for PDAs, EnRoute and RouteFinder launched.
2001 Palmtop renamed TomTom. Harold Goddijn joins TomTom as CEO. Number of employees 30.
2002 First GPS-linked car navigation product for PDAs, TomTom NAVIGATOR shipped. €8 million revenue.
2003 NavCore Software Architecture developed, on which all TomTom products are still based. Number of
employees 90.
2004 First portable navigation device shipped, the TomTom GO. 248,000 PND units sold.
2005 TomTom listed on Euronext Amsterdam. €720 million revenue.
2006 TomTom WORK andTomTom Mobility Solutions launched. Number of employees 818
2007 TomTom makes offer for Tele Atlas. TomTom HD Traffic andTomTom Map Share launched. 9.6 million PND
units sold.
2008 TomTom acquired Tele Atlas.

Source: http://investors.tomtom.com/overview.cfm

Exhibit 2 Sales Revenue and Net Income (€) Exhibit 4 R e v e n u e per s e g m e n t

2,000,000
(in€

L
1,500,000 millions) Q1'09 Q1'08 y.o.y Q4'08 q.o.q ]

1,000,000 Revenue 172 264 -35% 473 -64%

L
500,000 PNDs 141 234 -40% 444 -68%

0 Others 31 29 5% 29 5%
2005 2006 2007
-500,000
# of PNDs
sold (in
1,419 1,997 -29% 4,443
-68% I
-1,000,000 thousands)

-1,500,000 Average 99 117 -15% 100 - 1 % [

Sales • Net Income selling
price (€)

Exhibit 5 R e v e n u e per r e g i o n
•
(in € millions) Q1'08 Q1'09 Difference I
1
Europe 178,114 146,549
-22%
North America 84,641 55,558 -52%

Rest of world 1,087 10,976 90%

Q1 Q2 Q3 Q4
Total 263,842 213,083 -24%
• 2009 • 2008 • 2007
 Section A: Business-Level Strategy

Exhibit 6 Cash versus Long term debt (in thousand €)

12/31/2005 12/31/2006 12/31/2007 12/31/2008 6/30/2009

Long Term Debt 301 338 377 4,749 4,811

Cash Assets 178,377 437,801 463,339 321,039 422,530

Borrowings 0 0 1,241,900 1,195,715

Exhibit 7 Operating Margin

30% -i •

25%

I II|
20% •

m m m m
0% ^ ^ ^ ^
2005 2006 2007 2008
• Operating Margin

APPENDIX: GOOGLE D R I V E S INTO NAVIGATION M A R K E T

RUETERS
Wed Oct 28, 2009 11:30 am EDT
S A N F R A N C I S C O (Reuters)—Google I n c . is a d d -
ing G a r m i n L t d a n d T o m T o m t o its g r o w i n g list o f
rivals as the Internet search giant weaves t e c h n o l o g y
for d r i v i n g directions i n t o n e w versions o f its s m a r t -
phone s o f t w a r e .
Google said its n e w Google M a p s N a v i g a t i o n
p r o d u c t w i l l p r o v i d e r e a l - t i m e , t u r n - b y - t u r n direc-
tions d i r e c t l y w i t h i n cell phones t h a t are based o n
the n e w version o f its A n d r o i d s o f t w a r e .
The n a v i g a t i o n p r o d u c t , w h i c h features speech
recognition a n d a visual display t h a t i n c o r p o r a t e s
Google's online archive o f street p h o t o g r a p h s , m a r k s
the latest step by Google t o challenge A p p l e Inc's
iPhone a n d M i c r o s o f t Corp's W i n d o w s M o b i l e soft-
ware w i t h its A n d r o i d s m a r t p h o n e s o f t w a r e .
I t also represents a direct c o m p e t i t i v e t h r e a t t o
companies like G a r m i n a n d T o m T o m w h i c h sell
specialized h a r d w a r e n a v i g a t i o n devices. T o m T o m
also makes a s o f t w a r e n a v i g a t i o n a p p f o r the iPhone
t h a t sells f o r $ 9 9 . 9 9 i n t h e U.S.
G o o g l e executives t o l d reporters at a press brief-
ing o n Tuesday ahead o f the a n n o u n c e m e n t t h a t the
c o m p a n y decided t o o f f e r t u r n - b y - t u r n d r i v i n g d i -
rections i n its f o u r - y e a r - o l d maps p r o d u c t because i t
was t h e m o s t requested feature by users.
C E O Eric S c h m i d t said t h a t e x p a n d i n g i n t o a
new m a r k e t w i t h n e w c o m p e t i t o r s w a s n o t a p a r t o f
Google's m o t i v a t i o n .
" T h o s e are tactical p r o b l e m s t h a t occur after the
strategic g o a l w h i c h is t o o f f e r s o m e t h i n g w h i c h is
sort o f m a g i c a l o n m o b i l e devices using the c l o u d , "
S c h m i d t said.
T h e n e w n a v i g a t i o n service w i l l w o r k w i t h
Google's f o r t h c o m i n g A n d r o i d 2 . 0 s o f t w a r e , the
 Case 14: TomTom: New Competition Everywhere!

next version o f the s m a r t p h o n e o p e r a t i n g system G o o g l e said the p r o d u c t , w h i c h w i l l i n i t i a l l y be

developed by G o o g l e . T h e c o m p a n y a n n o u n c e d
development t o o l s f o r A n d r o i d 2.0 o n Tuesday, b u t
a s p o k e s w o m a n said specific details a b o u t w h e n
A n d r o i d 2.0 w i l l be available s h o u l d be directed t o
phone-makers a n d wireless carriers.
l i m i t e d t o d r i v i n g d i r e c t i o n s i n the U.S., w i l l be free
for consumers.
Reporting by Alexei Oreskovic; Editing Bernard O r r
© T h o m s o n Reuters 2 0 0 9 A l l rights reserved.

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