Telenav is a leading provider of location-based platform services. These services
consist of our automotive and mobile navigation platform and our advertising
delivery platform. Our auto and mobile navigation platform allows Telenav to
deliver enhanced location-based services to auto manufacturers, developers and
end users through various distribution channels, including wireless carriers.
Our advertising delivery platform delivers highly targeted advertising services
leveraging our location expertise. We report operating results in three business
segments: automotive, advertising and mobile navigation.
For our automotive segment customers, we offer our auto and mobile navigation
platform services to vehicle manufacturers and original equipment manufacturers,
or OEMs, for distribution with their vehicles. Our primary automotive customer
to date, Ford Motor Company, or Ford, currently distributes our embedded, or
on-board, product as an optional feature with all of its models in the U.S.
Our automotive products are now included on models manufactured in the U.S.,
Canada, Mexico, Europe and China, as well as offered in models in South America,
Australia and New Zealand. In January 2014 we entered into an agreement with
General Motors Corporation, or GM, for integration of our on-board and connected
navigation solutions in its vehicles, which we expect to launch in model year
2017. Our relationship with GM also includes our mobile phone-based wireless
connectivity, or brought-in, services for vehicles. In January 2015, GM launched
the new version of its OnStar RemoteLink® mobile application powered by
our location-based services platform, which includes mapping and one-box search.
In July 2015, we and Toyota Motor Corporation, or Toyota, announced a partnership
for brought-in navigation services where our Scout GPS Link will be available
first in the model year 2016 Toyota Tacoma, and subsequently in other Entune™
Audio Plus equipped model year 2016 Toyota vehicles in the United States. We
believe our history as a supplier of cloud-based navigation services provides
a unique advantage in the automotive navigation marketplace over our competitors.
For our advertising segment customers, we believe our advertising delivery
platform offers significant audience reach, sophisticated targeting capabilities
and the ability to deliver interactive and engaging ad experiences to consumers
on their mobile devices. We are experts in location-based advertising and believe
we offer unique value to brick-and-mortar and brand advertisers through our
location targeting capabilities. Our technology focuses on managing the complexity
and scale associated with mobile location data to deliver better mobile campaigns
for our advertising partners. We deliver mobile advertisements by leveraging
our proprietary in-house ad serving technology. Our inventory, or accessible
market, is comprised of thousands of mobile applications and mobile websites
that are accessed through programmatic real-time bidding, or RTB, tools.
We derive revenue from automobile manufacturers and OEMs, advertisers and advertising
agencies, and wireless carriers. We receive revenue from automobile manufacturers
whose vehicles contain our proprietary software and are able to access our personalized
navigation services. These manufacturers have typically not provided us with
any volume or revenue guarantees. In addition, we have a growing business in
mobile advertising where our customers are primarily advertising agencies, which
represent national and regional brands, and channel partners, which work closely
with local and small business advertisers. We also derive revenue from our partnerships
with wireless carriers, who pay us to enable their subscribers to use our mobile
navigation services. Some of these wireless carriers bill their subscribers
on a monthly recurring basis and the number of those monthly recurring subscribers
to which we provide services continues to decline, resulting in substantial
declines in our revenue from wireless carriers.
We generate revenue from the delivery of customized software and royalties from
the distribution of this customized software in automotive navigation applications.
For example, Ford utilizes our on-board automotive navigation product in its
Ford SYNC platform. Our automobile manufacturer and OEM customers pay us a royalty
fee as the software is reproduced for installation in vehicles with our automotive
navigation solutions. In addition, we earn a one-time royalty for each new vehicle
owner who downloads the GM OnStar RemoteLink® application, whereby we provide
enhanced search capabilities for contracted service periods.
Auto and Mobile Navigation Services Platform
Our map and navigation platform was originally developed to target mobile devices
with real-time directions and information about places near the user’s
mobile device. More recently, we have evolved our platform so that it is primarily
targeted to deliver solutions for automotive manufacturers and OEMs. We have
also enhanced our solutions to make them better suited for the in-car experience.
We have developed proprietary technologies that enable us to provide location-based
mapping and navigation services. These technologies include both client-based
and cloud-based services. Our client technologies include a navigation and guidance
engine and tools allowing us to efficiently develop and deploy new applications
to mobile phones and in vehicles. Our back-end cloud services technologies allow
us to deliver real-time location-based data for users and third party software
developers that adopt our software development kit, or SDK, and application
protocol interfaces, or APIs. We have developed a flexible platform that allows
us to use multiple data providers for navigation, maps, points of interest,
or POIs, traffic and other location-based content services.
In January 2014, we acquired skobbler GmbH, or skobbler, a leading provider
of technologies that enhance the Open Street Map, or OSM, mapping data. By combining
these technologies with other proprietary Telenav technologies, we have developed
a range of OSM capabilities that allow us to use these crowd sourced maps for
more advanced services such as navigation. We believe that focusing our efforts
on OSM will better position us relative to our competitors and expand the nature
and extent of our product offerings.
Our software and client application development processes, which include design,
porting and publication processes, allow us to extend our services effectively
and efficiently to different automobiles across various automotive platforms
and in-car electronic systems to meet the requirements of automobile manufacturers
and OEMs for our on-board and brought-in automotive products.
Our back-end cloud technologies include our Geographic Information System, or
GIS, engines for local search, voice recognition, geo alert and advanced geo
data aggregation, traffic and a local advertising platform. We have developed
customized voice recognition technology built upon a third party voice recognition
engine to serve the specific needs of navigation services customers. We leverage
our existing back-end cloud technologies for deployment to automobile manufacturer
and OEM solution applications. We utilize existing technology to expand the
connectivity and service offerings for in-car experiences, including seamless
interaction between end users mobile devices and on-board automobile systems
such as displays, sensors and audio for our automotive brought-in navigation
solutions.
We have developed a search technology that focuses on information with localized
relevance and accuracy to address the needs of automotive and mobile phone users.
Our proprietary GIS provides fast route and map generation while optimizing
the route based on current traffic conditions. Because our proprietary GIS efficiently
uses computing resources, these efficiencies enable us to scale our servers
more economically for our automotive brought-in solutions.
In addition to our automotive navigation services, we offer our map and navigation
platform to mobile phone users in a number of ways. We distribute our services
through our wireless carrier partners, including AT&T Mobility LLC, or AT&T,
and directly to consumers through mobile application stores and marketplaces.
We distribute our premium services under wireless carrier brands (or “white
label” brands). We provide our basic services directly to mobile phone
users for free and provide these users with the opportunity to purchase premium
versions of the product. We refer to the free to premium distribution as the
“freemium” model of distribution. Our free products are designed
to be monetized through delivery of advertising to mobile phone users through
our application. Our success with the freemium model depends upon our ability
to generate a substantial active user base, place ads to those mobile phone
users and convert those users from free to premium services.
Telenavs Advertising Delivery Platform
Our advertising platform allows us to deliver mobile advertisements on behalf
of our advertising clients to consumers based specifically on the location of
the consumer. We have developed proprietary technologies that enable us to deliver
location-based advertising across all types of mobile devices at scale. Our
platform integrates location-enabled mobile advertising inventory with a number
of contextual and location-based triggers to allow us to target mobile users
based on rich location data. We have demonstrated that targeting based on location
data is more likely to engage consumers. Our platform permits us to bid and
deliver ad impressions through advertising exchanges in less than 30 milliseconds
and to do so on billions of potential impressions every day. In addition, we
have the ability to target our mobile campaigns based on a variety of criteria
beyond location. Our platform was built to provide scalability through the use
of machine-based decision processes, which allows us to execute thousands of
campaigns, each with complex targeting criteria across multiple inventory sources.
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