The European Commission has granted antitrust approval to personal navigation device maker TomTom’s proposed acquisition of Tele Atlas, one of two providers of navigable digital maps on a worldwide basis. The deal received U.S. antitrust approval last October.
“After thorough investigation, I am now satisfied that the innovation and competition we have seen in [satellite navigation technology] until now will continue after this merger, and that consumers will continue to benefit from new and innovative products,” said EC Competition Commissioner Neelie Kroes.
The EC’s ruling “is the best possible outcome for TomTom and Tele Atlas, allowing the new combination to go ahead with the full execution of its strategy” for speeding up and enriching the digital-mapmaking process, the two companies said.
Enriching Digital Maps
The production process at Tele Atlas right now is both lengthy and expensive, with several months often passing before a new map version with corrected data is released. Once the merger closes, however, Tele Atlas will be able to speed up the process by making full use of incremental mapping data gathered by TomTom.
“TomTom has developed unique technologies to collect and process map-related data from our user base of over 15 million GPS navigation devices,” explained TomTom Chief Executive Harold Goddijn. “This information will be delivered to Tele Atlas after the proposed merger to allow Tele Atlas to substantially improve its map creation, enrichment and maintenance process.”
TomTom’s sales of navigation devices are rising rapidly due to steep price reductions. The company said last month that device sales grew 50 percent year over year to two million units in the first quarter at an average selling price of $181.
Changes Ahead
Goddijn believes the navigation industry will change significantly in the next few years as customers give ever-increasing importance to intelligent routing and up-to-date maps. “We are already seeing an…