Text | Geng Changbao
Source | Bowang Finance
Are you still wondering which map navigation app on your mobile phone is better? Baidu Maps over there has been competing with NavInfo, the former industry leader, because map data has been in the market for 6 years. Now we have just obtained a civil judgment from the Beijing Higher People's Court. The judgment found that the three main companies behind Baidu Maps should compensate NavInfo for economic losses of 65.42 million yuan.
What kind of entanglement does Baidu Maps have with NavInfo? Why did the former car navigation giant choose to fight to the death with the online navigation app that was so popular? From comrades who worked closely together to enemies in court, what happened in the past few years?
01
b The love-hate relationship between NavInfo and Baidu Maps, the big boss of the end-to-end car machine, NavInfo
NavInfo has still had a "state-owned" background despite several joint-stock reforms. Its predecessor was the Navigation Department of China NavInfo, China NavInfo The Surveying and Mapping Technology Corporation was founded in 1992 by the State Administration of Surveying and Mapping. It is the only company in China that specializes in surveying and mapping. It is affiliated to China Aerospace Science and Technology Group Co., Ltd. directly under the State-owned Assets Supervision and Administration Commission. NavInfo was born to target the future growth of the domestic automobile market. It was established in 2002 and obtained the first batch of Class A surveying and mapping qualifications in China.
At this time, it was the first year that China officially joined the World Trade Organization (WTO). The two major measures of "globalization" and "cars entering the home" have brought unprecedented changes to the Chinese automobile industry. That year, Beijing Hyundai officially put into production and the first-generation Sonata rolled off the production line. Although the personalized license plates were suspended after only 7 days of issuance, from that year on, cars have increasingly entered the homes of Chinese people. Foreign car companies are also attracted by China's huge market and seek to enter the Chinese market in various ways.
It is precisely this spring breeze that in-car entertainment, mainly listening to radio and CDs, has allowed Chinese people who still don’t know what in-car navigation is to see the strength of NavInfo.
In the seven years from 2003 to 2010, NavInfo has occupied over 60% of the vehicle pre-installed navigation market for seven consecutive years. From 2007 to 2009, NavInfo has cooperated with Toyota, Honda, Volkswagen and other car companies. The vehicles were equipped with NavInfo navigation system when they left the factory. At the same time, high-end models of Nokia mobile phones during that period were also Built-in maps newly provided by NavInfo.
In 2010, NavInfo had become the largest navigation electronic map service provider in China, ranking first in the industry in market share of vehicle navigation maps and GPS mobile maps. In that year, it was successfully listed on the Shenzhen Stock Exchange.
When NavInfo was overcoming obstacles in the field of car navigation, the PC version of Baidu Maps was the first to go online in 2005. In that era when minesweeper and FreeCell could be played for a day, no one would care about the PC version of the map on a website. . Baidu also keenly discovered the changes in the Internet. 3G mobile networks began to gradually develop and grow. Only relying on its own technology accumulation may not necessarily be able to tell a good technology story in the Nasdaq stock market, so it found the big brother in the navigation industry at that time, SiDitu. new.
Starting in 2009, Baidu Netcom and Baidu Online, both subsidiaries of Baidu, began to cooperate with NavInfo in the field of electronic map data. In 2013, Baidu and NavInfo reached a "Cooperation Agreement". The contract is valid until December 31, 2016. The main contents of the agreement are: NavInfo will provide electronic map work authorization to the above two companies, and the above company will provide authorization to NavInfo to NavInfo. Tuxin pays the corresponding fees, one purchase and one sale, which is fair and reasonable.
However, starting in 2010, with the overnight popularity of Apple's iPhone 4, the shape of mobile phones with large screens and full virtual keyboards directly changed the entire mobile phone industry. Smartphones replaced feature phones, and mobile navigation became the focus of major giants overnight. market. NavInfo has also extended its business to map compilation, Internet of Vehicles business, location big data, autonomous driving and other related fields through a series of acquisitions.
02
After the agreement expired, I chose NavInfo to defend my rights.
Baidu was not idle either. In 2013, when it formally signed the "Cooperation Agreement" with NavInfo, it obtained a Class A surveying and mapping qualification through acquisition. From then on, Later, Baidu map data collection vehicles with various cameras on their roofs became common on the road. In 2014, Tencent Industrial Fund acquired 78 million shares of NavInfo at a price of 1.17 billion yuan, with a shareholding ratio of 11.28%. It became the second largest shareholder of NavInfo and is known as the first shareholder in the mixed ownership reform of central enterprises. . However, in the third quarter of 2022, Tencent Industrial Fund has quietly withdrawn from the shareholder list. When Tencent was a shareholder of NavInfo, all location services in Tencent Maps, WeChat and other software were provided by NavInfo. At the same time, NavInfo also provides data and related technical support to apps such as Sogou and Didi, as well as mainstream car manufacturers such as BMW, Volkswagen, and Mercedes-Benz.
At the end of 2016, the agreement between the two parties expired. Baidu, which already held Class A surveying and mapping qualifications and had certain technical reserves, was not prepared to continue paying, so it did not choose to renew. In 2017, NavInfo discovered that Baidu was still using its own map data without paying, and directly chose to sue, demanding a public apology and compensation for economic losses and reasonable expenses totaling 100 million yuan. Three years later, in 2020, the first-instance verdict concluded that NavInfo won the case and required Baidu to stop using NavInfo-related works and data, publicly apologize, and compensate for economic losses of 64.5 million yuan and reasonable expenses of 926,600 yuan. Of course,
Baidu was not convinced, and quickly filed an appeal, suing NavInfo and its affiliated companies on the grounds of copyright infringement and unfair competition, demanding compensation of 90 million yuan in economic losses. The "mutual stranglehold" war between the two sides officially began.
On December 28, 2023, the Beijing Higher People's Court made a final judgment, rejecting Baidu's appeal, upholding the original judgment, and ordering Baidu.com and three other companies to stop infringement, apologize, eliminate the impact, and jointly and severally compensate NavInfo Economic losses and reasonable expenses were 65.4266 million yuan.
In response to the final judgment, Baidu stated in a media interview: Since the termination of the contract with NavInfo in 2016, Baidu Maps has used self-collected data, not the other party’s data. Baidu will apply to the Supreme People's Court for retrial to safeguard our legitimate interests. The company has launched a lawsuit against NavInfo for infringement of Baidu Maps copyright and unfair competition. Baidu always respects and protects intellectual property rights and conducts business operations in accordance with the principles of legality and compliance.
03
NavInfo is having a hard time, with losses exceeding 800 million in two years
From in-vehicle navigation to car-grade chips, to smart driving and smart cockpits, NavInfo's business scope is getting wider and wider, and its revenue in recent years has also Remarkable, but due to various reasons, its net profits in 2020, 2022, and the first three quarters of 2023 are: -309 million yuan, -336 million yuan, and -495 million yuan respectively. In other words, from 2022 In less than 2 years from 2023 to the third quarter of 2023, NavInfo lost more than 800 million yuan.
In 2020, it can be temporarily understood that due to the impact of the epidemic, NavInfo achieved operating income of 3.06 billion yuan in 2021, a year-on-year increase of 42.48%, a new high since its listing. However, the net profit attributable to the parent company was -336 million yuan, a year-on-year decrease of 375.48%, excluding non-profit Net profit dropped by 683.14%. At the same time, NavInfo's gross profit margin is also declining, with a gross profit margin of 49.15% in 2022, a new low in the past six years. Prior to this, the company's gross profit margin declined year by year from 2018 to 2021, with the company's gross profit margin being 70.65%, 68.67%, 65.54%, and 59.89% respectively. The main reason for the decline in gross profit margin caused by
is that the proportion of R&D funds invested has increased significantly. Data shows that the amount of R&D investment in 2022 will be 1.788 billion yuan, accounting for 53.44% of total revenue, a year-on-year increase of 24.90%. Another reason is that operating costs, sales, and financial costs have increased significantly. More importantly, the new “sense-focused, map-light” technology path advocated by typical leading manufacturers such as Huawei and Tesla has also impacted NavInfo, which started out with high-precision map navigation, to a certain extent. development of.The new generation of smart driving technology no longer requires real-time online high-precision maps. Instead, it uses a series of on-board equipment to realize the perception of the external road environment and obstacles, and achieve precise navigation without network or satellite communication. Every major technological change is basically at the expense of the predecessors of the previous generation. NavInfo's ability to maintain its current status is inseparable from its in-depth layout of intelligent driving software and hardware integrated solutions, and this is also This is the market that Baidu Maps has been laying out. Therefore, it is not so much an intellectual property dispute between Baidu Maps and NavInfo over map data as it is an interest dispute on the smart driving track. What both parties care about is not the tens of millions of compensation, but a judgment that allows the other party to His reputation was ruined and he lost his main market.
04
The data business of the smart driving track tycoons
is different from Baidu Maps, which is free for the c-side and provides map point advertising for the b-side for a fee. NavInfo provides based on in-depth cooperation with car manufacturers. Map's comprehensive intelligent driving solution, by the end of 2022, the shipment volume of automotive-grade MCU chips will exceed 30 million. Baidu has been deploying smart driving for 10 years since 2013. In more than 10 domestic cities, it has accumulated 78 million kilometers of roadside accidents in more than 10 cities in China. In smart driving, smart cockpit, smart map, and open smart driving development platform Wait, it is almost completely integrated with NavInfo’s new business. In the manufacturer's choice of smart driving solutions, it is completely a competitor with NavInfo.
Currently, NavInfo’s main businesses include smart cloud business, smart driving business, smart cabin business, and smart core business. From the perspective of 2022, Zhiyun business will still be its pillar business segment, with annual revenue of 2.06 billion yuan, a year-on-year increase of 3.14%, and revenue accounting for more than 60%. There are only a few traditional car companies and new-generation manufacturers. Baidu suffers from the lack of car-grade chips, and everything is based on software systems.
Even if Baidu compensates more than 65 million yuan in full, it will still be a drop in the bucket for NavInfo. Facing the rising new forces in car manufacturing, only by continuous research and development and launching leading products will anyone have a chance to reach the end. For Baidu Maps and NavInfo, there is still a tough battle to be fought in the future. This is more tragic than the six years of mutual complaints and conflicts. I don’t know if these two are ready.
