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Google Maps’ Moat Is Evaporating

The views expressed in this newsletter are solely my very own, , nor represent the views of my employer. Well, they arent solely my very own, because Ive stolen many of them from people smarter than me. But, you obtain what Im saying.

In the event that you just work at the intersection of maps and software, at some time that you experienced youve probably heard yourself muttering some version of the next analogy to a stubbornly confused relative:

You understand Google Maps? What I really do is, like, build little bits of Google Maps again and again for those who need them but cant just use Google Maps because theyre prohibited to for reasons uknown, or another.

Needless to say, you won’t ever quite put it this way, since it would hurt a great deal to admit it to yourself so plainly.

Folks have half-heartedly compared their profession to Google Maps at family gatherings for more than ten years, because since inception, Google has consistently created the very best consumer-facing maps on the planet. And Im not only discussing coveragethey are the surface of the class in turn-by-turn navigation, geocoding, satellite imagery layers, street level imagery, place data, and on, and on.

The title of todays newsletter can be an allusion to a post from a couple of years ago, Google Maps Moat, by Justin O’Beirne. He demonstrates, quite convincingly, that Google includes a huge head start over Apple when it comes to foundational data (e.g. roads, buildings, parks, etc.), especially in the continental USA. However in the years since, Justin has posted update after update showing Apples steady climb toward parity.

Even Googles crown jewel, Street View, is under siegea new initiative from Apple called SHOP AROUND is pumping out street-level panoramic imagery at a furious clip thats becoming furiouser and furiouser by the week. Heres an excerpt from Justins last dispatch:

Its hard to knock Big G. Theyre still the largest and besta Morgan Stanley analyst estimated that Google Maps generated almost $3B in advertising revenue in 2019 alone. But I suspect were at the tail end of the golden era for Google Maps. They appear, if you ask me, to be acting from the host to fear and conservatism instead of innovation.

Back 2012, I hadn’t yet been born (I’m, actually, only six yrs . old). But I’m students of history. Apple Maps launched that year, also it was received so terribly that Tim Cook made a decision to write an individual apology for hawaii of the app. He even went as far as to advise that iPhone users download Bing Maps while Apple sorted itself out

For the reason that moment, Googles strategy of investing ungodly sums into Google Maps and keeping all the data proprietary paid in spectacular fashion. Apple had pie around their face and Microsoft had tethered their consumer map product to the Bing brand, that was saddled with a comically inferior reputation in the search domain. Even though Bing Maps had somehow been comparable with Google Maps from the gate, the common consumer could have associated the brand with being truly a knock-off of Google anyway. That year, and for quite some time afterward, Google looked unstoppable.

Then things began to take a change 2018, per year after Justin O’Beirnes seminal summary of Googles moat.

See, Google Maps isn’t just an app on your own phone. Its also a suite of developer tools that power countless other applications which are used by thousands of people each day. And that area of the business is called the Google Maps Platform (but more often than not I hear it known as the Google Maps API).

In 2018, Google inexplicably made a decision to self-sabotage their enterprise maps business by raising their prices ~1,400% overnight. The only real time in my entire life that Ive ever felt envious of commission-based sales representatives was in the wake of this announcementI could have really liked to just work at Mapbox being an order-taker that following quarter.

Still, today, you will need an MBA with a specialization at heart Games to comprehend the Google Maps Platform pricing scheme, also it really helps to have a joint law degree to navigate their terms of service. Actually, the ToS are so Draconian, theyre the main topic of investigations by the home Subcommittee on Antitrust, Commercial, and Administrative Law. The best tidbit from their recent report, Competition in Digital Markets quotes an anonymous Google Maps Platform customer:

Several developers stated that Google Maps introduced greater licensing restrictions since it gained a stronger market position. One noted that Googles control over what now serves as an integral mapping technology has allowed Google to call all of the shots. We license Google Maps and its own essentially a contract of adhesion. Its filled with restrictions and we arent in a position to negotiate any changes, the developer said.

They are what of a business that’s annoyed they ever let people become their customers. And for what? A couple of hundred million in fees, maybe? Thats likely nothing when compared to billions in advertising revenue from consumers looking for the very best hamburger around. Why not jack up the costs, lock down the info, and let em churn, baby, churn?

The difficulty is, Google isnt the only real game around anymore. Should they keep alienating their customers and pursuing a proprietary data strategy no matter what, theyre likely to continue steadily to lose ground to competition while spending as part of your merely to tread water.

Its not yet determined yet that mapping is big business, but its quite clear that big business is mapping. The most famous thing Ive ever written is really a piece concerning the incredible year OpenStreetMap is having, largely due to enormous investment from Facebook, Apple, Amazon, Microsoft, and Mapbox (FAAMm).

Googles slight advantage with regards to navigation and foundational features may be overtaken by the collective effort of these deep-pocketed competitors. Googles remaining edge in street level imagery, place data, and 3D data all seem weaker than at at any time within their history. Challengers are crowding in from all sides:

Among my favorite blogs ever is Steve Yegges missive, Why I left Google to become listed on Grab. Inside it, he claims the principal reason he could be leaving is basically because:

First, theyre conservative: They’re so centered on protecting what theyve got, they fear risk-taking and real innovation. Gatekeeping and risk aversion at Google will be the norm as opposed to the exception.

OpenStreetMap (OSM), on the next decade, gets the potential to accomplish to Google what Android did to Apple: dramatically grow the entire market while drawing an obvious line between your larger open ecosystem and small proprietary one. The difference is that while Google Maps probably makes billions annually, in addition, it probably costs billions to keep up, leaving it wallowing in a low-margin no-mans land in comparison to its your government Google Search.

What gives Google Maps an advantage over other experiences? Today, I’d argue the three pillars of its comparative advantage are Places, Street View, and 3D data. However in a couple of years, I think it’ll mostly you need to be Places. And shortly thereafter, this could wind up without remaining edge beyond convenience and brand loyalty.

I dont believe Google can maintain steadily its leading position in the program mapping world for another decade without pivoting to embrace exactly the same open ecosystem that FAAMm is using to challenge them. Imagine, as my pal Sean Gorman recently wrote, a global where the 3D globe was a public good (or, by extension, if all foundational features and tourist destinations were treated this way). What would which means that for the competitive landscape?

Rather than question of who gets the resources to create the very best private datasets and protect their proprietary nature, the battleground of competitive advantage would shift to user experience, convenience, and creativity. And, for me, Google comes with an edge there over FAAMmthe more Google Maps can tie into GSuite and the others of these prodigious ecosystem of popular applications, the more they are able to differentiate on superior user experience and less they need to depend on superior data.

If Google doesnt begin taking the Google Maps Platform seriously, theyll gradually end up alone on an island of inferior, less frequently updated, and expensive-to-maintain proprietary data. A fresh generation of innovative apps built along with OSM will feast like piranhas on a cow treading water.

For me, you can find three major strategic decisions which could position them to keep their leadership position in to the next decade:

  1. Ride the OSM wave rather than fighting it. Foundational feature data is now commoditized, but Google will make it collectivized. By combining efforts with OSM more broadly, Google could reduce its cost basis continue and release resources for competing at what theyre really great at: building great software.

  2. Take it easy licensing restrictions on the Maps Platform generally. Allow customers to digitize features visible in Street View imagery, for example. Grant permission to users who wish to mix-and-match your geocoding service with a beautifully-styled basemap from Mapbox. Youre stifling countless creative uses for the services while fighting against an irresistible force that the core of one’s search business is made upon: information really wants to be free.

  3. Aggressively price services to cultivate the entire market. Google Cloud Platform (GCP) is probable an outsized share into the future of one’s businessMicrosoft and Amazon clearly understand why about themselves. However when it involves maps, you have the lead. By mis-pricing your maps API, youre going for a cracked door and slamming it spacious for the competitors. And for what? You don’t need the incremental revenue today?

Who’s Justin OBeirne? I’m confident he worked at Apple predicated on publicly available patent applications in his name, but I dont think he still works there if not theyd oftimes be pissed at him for writing publicly about their work (they’re notoriously secretive). He keeps a remarkably low profileno LinkedIn profile that I could find, no Github profile, as well as perhaps most confusingly, a Twitter profile that has been deleted earlier this month when i mentioned it publicly (but which had no tweets, a blank profile picture, and a large number of followers). I really like an excellent mystery!

Sorry, Mapbox, nevertheless, you dont get yourself a capital letter. Sure, youre a billion-dollar juggernaut and an enormous company by any normal measure, however your conspirators are each valued at over one trillion dollars.

The recently launched Placekey initiative deserves a shoutout here. I still dont understand it (sorry, Auren!), nonetheless it provides at the very least some evidence that there surely is widespread appetite for more openness and shared standards around common geospatial datasets.

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