Ladies and gentlemen,
Anyone who read my post after seeing the press on the Microsoft comments on their plans for online mapping would have noticed I was a little panicked.
The downside I saw (and still see to some extent) was that the "bluesky" element to the Neamrap story suddenly had some storm clouds on the horizon.
Before this I could envisage Nearmap smashing it in Europe. Now that looks to be a bit more difficult - but still not impossible - we have a big competitor in the same space.
Random thoughts on this...
1. The article mentioned that disaster areas would be mapped - to me this looks to be a direct response to the QLD flood activities of Nearmap. If you were not sure before, i think it can be certain the Nearmap is on their radar. Nearmap might even be influencing their strategic planning. On one hand this is bad - we have woken a giant, on the other hand it is good - Nearmap is on MCS radar and that means they must be doing something right.
2. The microsoft project appears to be very expensive and slooooow. With all their resources Microsoft have not come up with a significantly better technology. I think that this a really good sign for having a few good years jump on competitors.
3. Microsoft see no direct revenue from these activities - only to draw more traffic to Bing. $100 of millions on something that may or may not produce real returns in a revenue sense. Now Microsoft is cashed up beyond imagination but I am sceptical - if the mappers cannot demonstrate a genuine ROI to the business head honchos once this is up and running will it be supported long term? google has just dropped "Labs", microsoft dropped zune. This project has only a 50% chance of lasting more than 24 months IMHO.
4. Microsoft have a history of being beaten by more dynamic upstarts - just do some research on the "Quicken Books" story.
5. I garner that the map updates might be annual for Microsoft. This still does not really deliver on the immediacy element that Nearmap can provide. A 2-3 month update will still be significantly better and would still be worth paying for, for some clients. IMHO again.
6. There are much bigger games afoot for a company like Microsoft. The trend appears to be that the getting "social" thing and the post PC era is going to be a much higher priority. Big guys might start to prefer to outsource this mapping stuff and focus on the core business stuff.
7. Why - if they want to commit to the up-to-date-mapping-stuff-delivering-traffic-to-Bing strategy would they not just buy Nearmap for a couple of 100 million. That would be the cost of a couple of map updates and have some operating costs but that could be a smart move. 1 manager changing his/her mind on the strategy could result in an acquisition.
8. Microsoft's entry into this area does make things a lot tougher. The biggest IPR bull could not deny this.
My summary is that it would have been a lot easier if Microsoft had not raised it's ugly head in this area but possibilities are still alive and breathing... even promising.
Business is NEVER easy. It is dynamic and no one will ever just cede you some clear ground.
Rushed and red wine fuelled - but that is my (not properly thought through) thoughts nonetheless. Let me know if anyone has another take.
R
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