Nokia has bought map data company Navteq for $8.1 billion, a valuation of about 14 times its 2006 revenue of $582 million. A NYT article says the deal signals a “strategic bet” for Nokia. Both Google and Yahoo buy map data from Navteq to power their mapping services. The acquisition’s high price to revenue ratio is another demonstration that strategic collection of data is highly valuable. I wrote earlier on how speech recognition company Nuance’s high valuation was also due to its collection of (speech) data.
Speaking of map data, I found an interesting trivia when I started reading Stuart Skorman’s Confessions of a Serial Entrepreneur over the weekend. Apparently the makers of printed maps (back in the days…) had worried about other printers simply copying the maps that they had spent so much effort creating. Their response was to put in fictitious towns on their map. Seeing those fictitious towns in a competitor’s map was a sure sign of copyright infringement.
Update: The WSJ (sub. required) noted that the acquisition price is 50 times Navteq’s estimated earnings for this year.