So Why Did Apple Buy a Mapping Company?

Apple purchased digital mapmaker Placebase in July for an undisclosed sum, according to Seth Weintraub at Computerworld. Placebase, which we wrote about last year, is a Google Maps competitor that focuses on adding layers of public and private data to existing maps with an easy-to-use API. One use for the product, called PolicyMap, layers various types of data — like home sales, crime, or employment — over maps to help visualize data geographically. It’s big business, and the company was profitable without VC funding. So, why did Apple buy Placebase?

There are many reasons. For starters, it is becoming obvious that maps and geo-location are becoming crucial components of any modern operating system. Nokia was the first one to realize this and snapped up companies such as gate5 and Navteq.

Secondly, the acquisition allows Apple to decrease its reliance on former BFF Google. Apple could use Placebase’s technology to replace the Google Maps functionality in the iPhone and iPod Touch (and the new tablet, perhaps?) with its an in-house mapping solution. The ongoing legal fight between Apple, Google and the FCC over rejected apps on the iPhone App Store is well-known, as is Google CEO Eric Schmidt’s departure from Apple’s board in August.

Weintraub claims the Placebase purchase closed in July, which is a curious timeline. Did Schmidt know of Apple’s plans to purchase the company, or was this an instance of him “sitting out” of a board meeting, because it was a place where Apple and Google were possibly competing?

Apple and Google are competing on more and more fronts, and Apple may be looking to cut as many ties with Google as possible, in a seemingly belated attempt at keeping the fox out of the henhouse. The highest profile tie at the moment? The Google search-box currently in the top of every Safari user’s browser window — a search-box that likely sends a decently substantial amount of referral funds from Google to Apple. Given Microsoft’s need to expand its search share, it wouldn’t be inconceivable that Apple replaces Google with Bing. As long there is enough “cashback” for Apple!

Source: Gigaom, By Jason Golson