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Ecosystems back in vogue: Nokia to invest in smart car technology

Nokia has set up a fund for investing in the improvement of automotive technology companies. The fund will operate in conjunction with Nokia's HERE mapping unit, around which the firm hopes to build an ecosystem. The renewed buzz around the "e-word" comes despite Nokia's recent bitter experiences in the mobile phone business.

Liikennettä saksalaisella moottoritie A2:lla.
Smart move? Nokia is putting its money into "smart" automobile technology. Image: Bernd Thissen / EPA

The company is interested in car-related innovations because it already has a relatively strong foothold in built-in maps for automobiles.

The 100 million US dollar – or 72 million euro – fund will operate in close conjunction with the Nokia positioning-system HERE. According to a press release, the fund will invest in companies whose innovations will prove "important for a world of connected and intelligent vehicles.”

"Our new USD 100 million venture fund launched today further underlines our belief that the connected car is a significant growth opportunity where NGP is poised to make great investments,” says  Rajeev Suri, Nokia President and CEO. 

Survival of the fittest?

An ecosystem – geek talk for an operating system built around a big bundle of programmes and applications – was the continuous catchcry of Nokia's previous CEO, Stephen Elop. Two years ago, Elop was to ensure that Nokia mobile phones gained pole position in the ecosystems race.

Instead, the ecosystem around Android smart phones has grown to place them in the leading position, with Apple such a strong competitor that Nokia’s choice to place its confidence in the Windows platform ultimately led to the sale of its loss-making mobile devices unit.

On Monday, it was announced that the mutual fund Nokia Growth Partners would be responsible for the new fund.

There are a huge number of cars in the world, but the technology is still in its infancy, notes the investment company’s partner Paul Asel in his map unit blog.

“We believe that vehicles are becoming a new platform for mobile technology adoption akin to our experience in the phone industry,” he writes.

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