I just posted an interview that I conducted with Brian Bullock, CEO of Intermap Technologies. The following question and answer represents an important trend in the geospatial community, the fact that commercial applications of geospatial technology have surpassed government applications. The interview covers a lot of ground, but this single question and response bring up an issue that has far-ranging implications for the future of geospatial technology. Read the entire interview here.
V1: Governments have usually been in the position to take on projects at the scale, scope, and accuracy that you’ve undertaken. Is there any conflict between your solutions and the types of projects that governments undertake?
Bullock: We’re just trying to do the best we can for the customer and the user. Our first loyalty is to our customers and giving them products that they can use to enable new applications.
In my view, there’s a disruptive change happening in mapping. I spoke to this development at the National States Geographic Information Council (NSGIC) Conference last September. There are a lot of unhappy people in government mapping organizations right now because they see themselves being marginalized. Budgets are going down, and they’re losing control.
It’s a fact that commercial applications have now surpassed government applications. Mapping actually started in the 1700s, prompted by national security concerns between France and Britain, which were the first two countries to be mapped nationally. Then it moved into the national mapping phases and GIS, and government and utilities were the big users.
That has changed.The point I made at the NSGIC Conference is that now there’s vastly more money moving in these industries propelled by consumer applications than there is by large utility and professional applications. I illustrated that simply by taking my Garmin nüvi® to the stage and asked, “If we waited for government data, would this product exist today?” My answer: “It exists today because two companies, NAVTEQ and Tele Atlas, took the initiative to invest over a billion dollars, and they licensed it into this product for $30.”
More than 30 million of those devices were shipped in 2007. NAVTEQ and Tele Atlas’ combined revenue was $1.2 billion worth of maps. They’re spending a billion dollars a year updating and improving their databases. What other mapping organization in the world has access to that amount of cash?
In four years, the investment will double again. Look one level up at Location-Based Services (LBS) and how much cash it’s driving. Google’s whole thesis is that 50 percent of the advertising dollar is wasted because it isn’t location specific. Google is out to double the efficiency of the advertising dollar — location is propelling Google’s business.
If you look at Google’s total business today, and at Yahoo!, and Microsoft’s Virtual Earth, more than $20 billion a year is being driven by knowing location. That’s way beyond what any government is ever going to spend. So people in the traditional part of the industry just have to face the facts that the amount of cash coming from government, and even utilities what used to be the big drivers has now been dwarfed by LBS and consumer applications.
My belief is that, within a decade, sales of 2D and 3D maps for these types of applications will exceed $10 billion. So, it’s just not correct anymore to say government needs to be driving this, it’s simply not going to happen.
Anybody who doesn’t think there’s major change occurring needs to read Clayton Christiansen’s book The Innovator’s Dilemma , and just think about the dramatic change that’s happening.
{ 2 comments… read them below or add one }
RE: “It’s a fact that commercial applications have now surpassed government applications.” First, what does that mean? More commercial apps are in use in gov than gov created apps? There are more commercial uses of commercial data than gov uses? It’s not clear. Second, source for this “fact?”
Tom
Tom, I believe what Brian was referring to is that there are more commercial uses for geospatial data than there are government uses for geospatial data. With the balance toward commercial uses, commercial data providers are set to thrive, and there will likely be less funds for government-led geospatial data collection efforts.