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Open Source Mapping shakes competitors

The Netherlands: OpenStreetMaps could become the leading digital map provider within a few years, if technology giants like Microsoft, AOL and third party application developers continue to choose its free, open source mapping database for their location-based applications, Dow Jones reports.

That could prove a blow for commercial digital map makers such as Tele Atlas, owned by TomTom (Tom2.AE), Nokia’s (NOK) Navteq, and Google’s (GOOG) Google Maps, which currently dominate the digital map landscape.

Navigation and location are two of the biggest growth areas in the mobile industry, and the free open source mapping database provided by OpenStreetMaps, which allows users to rapidly update and edit maps with details not typically found in commercial map databases, is helping spur the next phase of location-based growth according to Henk Hoff, board member of the OpenStreetMap foundation and avid OSM map builder.

Hoff told Dow Jones Newswires in an interview that whilst TomTom and Nokia must have anticipated the surge in demand for location-based applications, which is why they paid heavy premiums for mapping companies Tele Atlas and Navteq in 2007, they didn’t foresee the effect that freely available mapping data would have on their business.

“I don’t think Tele Atlas and Navteq see OSM as a danger, but rather it’s the ideas behind OSM, namely the user-generated content, crowd sourcing, wiki-style developing and the fact that the data is free, that is threatening and has prompted these companies to rethink their business strategy. But, as long as they continue to add value to their maps, they’ll probably exist,” said Hoff.

“For TomTom, high quality accurate maps are essential for all our customers, from consumer to automotive, so they [OSM] are not impacting our business,” said TomTom spokeswoman Kristine Nillsson.

Nokia spokeswoman Kristina Bohlmann said, “When it comes to how to leverage crowd sourcing or community elements for map making, Nokia and Navteq are already using GPS probes for building better traffic service.”

“The value, or future revenue, isn’t in the mapping data itself or even in the points of interest,” said Hoff, “but in the information, specifically the location based services and location based advertising that is layered on top of the mapping data.”

OSM, which started in 2004, and is exclusively run by volunteers, provides a geospatial database of mapping data online, which any individual, company or group can use for free to make their own maps or run their own map servers. In return, OSM asks for attribution and for additions or improvements to the maps to be freely available. This year OSM counted 300,000 registered map makers, up from 1000 last year.

“Commercial companies can’t compete with that sort of growth” said Hoff. The big tech giants are taking notice. When AOL’s Mapquest announced it was adding OSM to its UK map offerings in July, it also announced USD 1 million fund to support the growth of open source mapping in the United States. In August, Microsoft’s BING search engine adopted OSM in its search engine platform.

“Admittedly I was surprised when Microsoft came to us about using OSM data,” said Hoff. After conducting data checks on quality, Microsoft told Hoff that they found OSM data was the best in many areas. In July, when AOL said Mapquest was opening up to OSM, the firm said in a press statement that open source is ultimately the future for its local and mapping applications and that community-generated maps that are of a high quality and accuracy will become the better mapping product for users.

Both Microsoft and AOL want good quality mapping data, but have said they don’t need to own it, according to Hoff.

Source: Dow Jones