Vici schreef op 19 april 2016 19:13:
next.ft.com/content/246b42ba-0621-11e... Financial Times: TomTom Lost and Found
AN HOUR AGO
When satellite navigation was the new thing, tales abounded of drivers stranded miles from their destination by the still-buggy tool. TomTom, a satnav trailblazer, must also avoid getting stuck in a cul-de-sac.
Smartphones have squeezed the Dutch company’s device sales. Despite a foray into watches, first-quarter sales of consumer products fell 4 per cent, it said on Tuesday.
But TomTom is no BlackBerry. It still has two very credible assets: its mapping database and, closely related, its independence. The world’s other two map databases are owned by Google and Here, which was sold to a consortium of German carmakers last year. The theory is that most automakers will be reluctant to allow a rival or software titan under the dashboard, and will instead flock to the uncompromised TomTom.
Sales in the automotive division were up 30 per cent in the first quarter. Licensing revenue rose strongly too. And the stock market is increasingly appreciative of the value of TomTom’s intellectual property. Over three years, its shares have outperformed those of Garmin — a US company with similar roots, but without a mapping database.The question is how to monetise that knowledge. Digital cartography is expensive, especially when it comes to adding the kind of detail that will be needed for driverless cars. TomTom warned that investment levels would increase this year; it is questionable how long it can rely on device sales to help fund such commitments. Before interest, tax, depreciation and amortisation, profits in the consumer division were €14m in 2015 — down from €55m in 2014. Consumer margins are barely a quarter of their 2013 levels.
It could sell the maps database. The €2.5bn fetched by Here is more than TomTom’s market value.
A better option, given its waning profitability, might be to ditch the consumer devices and focus on selling to carmakers and on mapping, with the fleet tracking and licensing businesses (Uber is a customer of the latter) driving profits. The company says there is still mileage in the devices that made its name. But it risks running out of road.