Nokia gave further details on its post-device strategy by revealing it is establishing a $100 million (€72 million) investment fund for companies developing connected car technology.
The fund will be managed by Nokia Growth Partners (NGP), an independent venture capital fund sponsored by the Finnish company. NGP will work with Nokia's Here mapping and location-based services division to seek out companies it believes are developing innovative technologies for connected and intelligent vehicles that will grow the Here ecosystem.
Nokia is tapping into a connected car market that automotive research company SBD predicts will be worth €39 billion ($54 billion) in 2018, compared to €13 billion in 2013.
The Finnish company last week announced its Here division as one of three core businesses in its post-devices strategy. Recently appointed CEO, Rajeev Suri, said the venture fund "underlines our belief that the connected car is a significant growth opportunity", and noted that NGP has consistently delivered "new innovation and financial return to Nokia."
Nokia's car fund is the fourth fund to be managed by NGP, and brings the total amount the venture company handles for Nokia to $700 million.
NGP partner, Paul Asel, noted technical innovation in the connected car field has surged in recent years. "Vehicles are becoming a new platform for technology adoption very similar to phones or tablets," he said. Technology advancements are making vehicles "safer, cleaner, increasingly connected, intelligent, and more affordable," he added.
The growing potential of connected vehicles was underscored at the Mobile World Congress (MWC) trade show in February, when companies including Qualcomm, AT&T and Ford demonstrated myriad products and services for the sector.
Telefónica, which demonstrated vehicle connectivity technology with car maker Tesla at MWC, followed this up in April with a machine-to-machine deal it said makes it Tesla's largest connectivity provider in Europe.
Rival operator Vodafone in March detailed a new agreement with Volkswagen and Audi to supply embedded SIM cards for all new Audi car models from 2015 onwards. That deal came hot on the heels of a demonstration of an in-car user interface from Apple by car makers Ferrari, Mercedes-Benz, and Volvo at the Geneva International Motor Show in March.
For more:
- see Nokia's funding announcement
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