Google Maps' Moat is Evaporating

The views expressed in this newsletter are solely my own, and do not represent the views of my employer. Well, they aren’t solely my own, because I’ve stolen most of them from people smarter than me. But, you get what I’m saying.

The race is on, and it’s all against one. Photo by Chris Kendall on Unsplash

If you work at the intersection of maps and software, at some point in your life you’ve probably heard yourself muttering some version of the following analogy to a stubbornly confused family member:

You know Google Maps? What I do is, like, build little pieces of Google Maps over and over for people who need them but can’t just use Google Maps because they’re not allowed to for some reason, or another.

Of course, you never quite put it that way, because it would hurt too much to admit it to yourself so plainly.

People have half-heartedly compared their profession to Google Maps at family gatherings for well over a decade, because since inception, Google has consistently created the best consumer-facing maps in the world. And I’m not just talking about coverage—they are top of the class in turn-by-turn navigation, geocoding, satellite imagery layers, street level imagery, place data, and on, and on.

The title of today’s newsletter is an allusion to a blog post from a few years ago, Google Maps’ Moat, by Justin O'Beirne.¹ He demonstrates, quite convincingly, that Google has a huge head start over Apple in terms of foundational data (e.g. roads, buildings, parks, etc.), especially in the continental United States. But in the years since, Justin has posted update after update showing Apple’s steady climb toward parity.

Even Google’s crown jewel, Street View, is under siege—a new initiative from Apple called “Look Around” is pumping out street-level panoramic imagery at a furious clip that’s becoming furiouser and furiouser by the week. Here’s an excerpt from Justin’s last dispatch:

Courtesy of Justin’s phenomenal blog (last updated just this month): https://www.justinobeirne.com/look-around-coverage-areas

Fear and Loathing in Mountain View

It’s hard to knock Big G. They’re still the biggest and best—a Morgan Stanley analyst estimated that Google Maps generated almost $3B in advertising revenue in 2019 alone. But I suspect we’re at the tail end of the golden era for Google Maps. They appear, to me, to be acting from a place of fear and conservatism rather than innovation.

Back in 2012, I had not yet been born (I am, in fact, only six years old). But I am a student of history. Apple Maps launched that year, and it was received so terribly that Tim Cook decided to write a personal apology for the state of the app. He even went so far as to recommend that iPhone users download Bing Maps while Apple sorted itself out…

In that moment, Google’s strategy of investing ungodly sums into Google Maps and keeping all of the data proprietary paid off in spectacular fashion. Apple had pie all over their face and Microsoft had tethered their consumer map product to the Bing brand, which was saddled with a comically inferior reputation in the search domain. Even if Bing Maps had somehow been comparable with Google Maps out of the gate, the average consumer would have associated the brand with being a knock-off of Google anyway. That year, and for many years afterward, Google looked unstoppable.

Then things started to take a turn around 2018, a year after Justin O'Beirne’s seminal summary of Google’s “moat.”

See, Google Maps is not just an app on your phone. It’s also a suite of developer tools that power countless other applications that are used by millions of people every day. And that part of the business is known as the Google Maps Platform (but most of the time I hear it referred to as the Google Maps API).

In 2018, Google inexplicably decided to self-sabotage their enterprise maps business by raising their prices ~1,400% overnight. The only time in my life that I’ve ever felt envious of commission-based sales people was in the wake of that announcement — I would have really liked to work at Mapbox as an order-taker that following quarter.

Still, today, you need an MBA with a specialization in Mind Games to understand the Google Maps Platform pricing scheme, and it helps to have a joint law degree to navigate their terms of service. In fact, the ToS are so Draconian, they’re the subject of investigations by the House Subcommittee on Antitrust, Commercial, and Administrative Law. My favorite tidbit from their recent report, Competition in Digital Markets quotes an anonymous Google Maps Platform customer:

Several developers stated that Google Maps introduced greater licensing restrictions as it gained a stronger market position. One noted that Google’s control over what now serves as a key mapping technology has allowed Google to call all the shots. “We license Google Maps and it’s essentially a contract of adhesion. It’s full of restrictions and we aren’t able to negotiate any changes,” the developer said.

These are the actions of an organization that is annoyed they ever let people become their customers. And for what? A few hundred million in fees, maybe? That’s likely nothing compared to the billions in advertising revenue from consumers searching for the best hamburger in town. So why not jack up the prices, lock down the data, and let ‘em churn, baby, churn?

The trouble is, Google isn’t the only game in town anymore. If they keep alienating their customers and pursuing a proprietary data strategy at all costs, they’re going to continue to lose ground to competition while spending more than ever just to tread water.

FAAMm is Coming

It’s not clear yet that mapping is big business, but it’s quite clear that big business is mapping. The most popular thing I’ve ever written is a piece about the incredible year OpenStreetMap is having, largely because of enormous investment from Facebook, Apple, Amazon, Microsoft, and Mapbox (FAAMm).²

Google’s slight advantage in terms of navigation and foundational features may well be overtaken by the collective effort of their deep-pocketed competitors. Google’s remaining edge in street level imagery, place data, and 3D data all seem weaker than at any moment in their history. Challengers are crowding in from all sides:

• With regard to street level imagery, I’m keeping an eye on what Facebook will do with Mapillary, the slew of well-funded HD mapping companies popping up (e.g. DeepMap, CARMERA), and Apple making a concerted effort with Look Around.

• Facebook’s Pages dataset seems like a natural rival to Google’s Places API if they ever decide to make a go of it. Yelp hates Google for many reasons (including an acquisition deal that fell through more than a decade ago) and would make for a suitable acquisition target for any of Google’s many competitors looking to jump-start an assault on their place data dominance.

• If Facebook ever did want to challenge Google with place data, they might consider partnering with someone like AWS. In fact, AWS just launched its own mapping service, Amazon Location, loaded with data from Esri and HERE.

• Meanwhile Mapbox’s recent launch of Mapbox GL JS v2.0 is taking direct aim at global 3D data, which Google won’t even deign to offer via their Maps Platform.

• And let’s not forget about Microsoft getting serious about their “Planetary Computer” and affiliated AI for Earth initiative, which are gearing up to be the stiffest competition Google Earth Engine has faced to date.

• Meanwhile at an office down the hall, Azure Maps has been humming along quietly since 2018, beating AWS to the punch by over two years. And Microsoft’s consumer app, Bing Maps, has been investing heavily in automated foundational feature creation, having not only openly licensed over 100M AI-generated building footprints but *also* the model and toolkit used to create them.

How Google Will Regress to the Mean if Nothing Changes

One of my favorite blog posts of all time is Steve Yegge’s missive, “Why I left Google to join Grab.” In it, he claims the primary reason he is leaving is because:

First, they’re conservative: They are so focused on protecting what they’ve got, that they fear risk-taking and real innovation. Gatekeeping and risk aversion at Google are the norm rather than the exception.

OpenStreetMap (OSM), over the next decade, has the potential to do to Google what Android did to Apple: dramatically grow the overall market while drawing a clear line between the larger “open” ecosystem and the smaller “proprietary” one. The difference is that while Google Maps probably makes billions annually, it also probably costs billions to maintain, leaving it wallowing in a low-margin no-man’s land compared to its big brother Google Search.

What gives Google Maps an edge over other experiences? Today, I would argue the three pillars of its comparative advantage are Places, Street View, and 3D data. But in a few years, I think it will mostly just be Places. And shortly thereafter, it may well wind up with no remaining edge beyond convenience and brand loyalty.

I don’t believe Google can maintain its leading position in the software mapping world for another decade without pivoting to embrace the same open ecosystem that FAAMm is using to challenge them. Imagine, as my friend Sean Gorman recently wrote, a world in which the 3D globe was a public good (or, by extension, if all foundational features and places of interest were treated that way). What would that mean for the competitive landscape? ³

Rather than a question of who has the resources to generate the best private datasets and protect their proprietary nature, the battleground of competitive advantage would shift to user experience, convenience, and creativity. And, in my opinion, Google has an edge there over FAAMm—the more Google Maps can tie into GSuite and the rest of their prodigious ecosystem of popular applications, the more they can differentiate on superior user experience and less they have to rely on superior data.

If Google doesn’t start taking the Google Maps Platform seriously, they’ll slowly but surely find themselves alone on an island of inferior, less frequently updated, and expensive-to-maintain proprietary data. A new generation of innovative apps built on top of OSM will feast like piranhas on a cow treading water.

In my opinion, there are three major strategic decisions that could position them to maintain their leadership position into the next decade:

1. Ride the OSM wave instead of fighting it. Foundational feature data is becoming commoditized, but Google could make it collectivized. By combining efforts with OSM more broadly, Google could reduce its cost basis moving forward and free up resources for competing at what they’re really great at: building great software.

2. Loosen up licensing restrictions on the Maps Platform generally. Allow customers to digitize features visible in Street View imagery, for instance. Grant permission to users who want to mix-and-match your geocoding service with a beautifully-styled basemap from Mapbox. You’re stifling countless creative uses for your services while fighting against an irresistible force that the core of your search business is built upon: information wants to be free.

3. Aggressively price services to grow the overall market. Google Cloud Platform (GCP) is likely an outsized share of the future of your business—Microsoft and Amazon clearly understand this about themselves. But when it comes to maps, you have the lead. By mis-pricing your maps API, you’re taking a cracked door and slamming it wide open for your competitors. And for what? Do you really need the incremental revenue today?

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¹ Who is Justin O’Beirne? I am confident he worked at Apple based on publicly available patent applications in his name, but I don’t think he still works there or else they’d probably be pissed at him for writing publicly about their work (they are notoriously secretive). He keeps an incredibly low profile—no LinkedIn profile that I can find, no Github profile, and perhaps most confusingly, a Twitter profile that was deleted earlier this month after I mentioned it publicly (but which had no tweets, a blank profile picture, and thousands of followers). I love a good mystery!

² Sorry, Mapbox, but you don’t get a capital letter. Sure, you’re a billion-dollar juggernaut and a massive company by any normal measure, but your conspirators are each valued at over one trillion dollars.

³ The recently launched Placekey initiative deserves a shoutout here. I still don’t understand it (sorry, Auren!), but it provides at least some evidence that there is widespread appetite for more openness and shared standards around common geospatial datasets.