Apple Inc. (NASDAQ:AAPL) made news over the weekend, and for a change it wasn’t anything to do with the Apple Watch.
Apple just confirmed it acquired Coherent Navigation, a startup focused on high-precision location and navigational services, and the move is likely to pay off by boosting Apple Maps capabilities.
But there could be even more to the buyout than that.
How Coherent Plays Into Plans for Apple Maps
Since unceremoniously ditching competitor Google Inc’s (NASDAQ:GOOG, NASDAQ:GOOGL) Google Maps app in iOS 6 in favor of its own Apple Maps, AAPL has been playing catchup. The move started badly enough that Apple CEO Tim Cook issued a rare apology for Apple Maps’ many issues.
AAPL has acquired a number of companies involved in navigation in an effort to gain some ground on Google, including Embark, HopStop and BroadMap, all of which were bought in 2013.
And yet, as TechCrunch points out, Google Maps still has roughly twice as much reach among iPhone users as Apple Maps.
AAPL has been working furiously (and spending freely) on improving its default navigation and locational app for iOS, so clearly the acquisition of Coherent Navigation is an admission that there’s still plenty more to do.
Conspiracy theorists might read a little more into this AAPL purchase, though.
In his Linkedin profile, former Coherent Navigation CEO (and now Apple Maps employee) Paul Lego describes the work his company was doing before being purchased by Apple:
“Coherent Navigation is developing a commercial high-precision navigation service that leverages the Iridium satellite network.”
Iridium Communications Inc (NASDAQ:IRDM) operates a network of 66 low-orbit satellites. Working with Boeing Co (NYSE:BA), the company developed a system called High Integrity Global Positioning System, also known as iGPS, that combined traditional GPS satellites with those low-orbit Iridium satellites. The resulting High Integrity GPS has a stronger signal, is tougher to jam and has accuracy measured in centimeters instead of the traditional GPS accuracy, which typically is measured in a range of 3 to 5 meters.
Coherent’s high-precision nav technology — leveraging that same Iridium satellite network — could naturally do wonders for Apple Maps’ accuracy and give it an edge over Google Maps.
But it might be able to do a little bit more.
Other Plans for Coherent?
If Apple is working on an electric car project as speculated, and the company has any ambitions about driverless capability, it would require extremely detailed locational services — much more accurate than those traditional GPS can provide. It also would need reliable communications, free from the GPS signal-blocking that can happen while driving in a city with tall buildings.
With its purchase of Coherent Navigation, AAPL has acquired technology that could provide solutions to both of these issues.
Adding fuel to the fire, CNBC reports that Coherent Navigation was also previously involved in projects involving autonomous navigation and robotics.
The purchase of Coherent Navigation could be nothing more than the latest AAPL acquisition to boost Apple Maps’ performance. As such, iPhone users stand to win. Happy iPhone owners are always good for Apple’s bottom line, and any competitive advantage gained over Google Maps could even help swing some Android users to the iOS camp.
But there’s also the remote possibility that Coherent Navigation could be something more — another piece in the Apple Car project.
And that would be a real win for AAPL shareholders.
As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.
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