November 17, 2005

Treasure Map

It's still early days for the mapspace boom, but smart online maps could soon alter the power balance in many an industry

by Wynn Quon

This year marks the beginning of the most dangerous time in the online world since the early nineties because there's a new cool in town. It's one of mankind's oldest information tools reforged for the digital age and it's about to change the face of the Web.

It started nine months ago when Google released Google Maps, a huge improvement over older mapping services like Fast and simple to use, Google also added aerial/satellite photo coverage. (Thus giving rise to, the ultimate website for armchair travelers).

The really cool part is this: Google let third-party software developers use its mapping service to build new applications. Within weeks enthusiasts were rolling out map websites by the dozens. Adrian Holovaty took crime statistics from the Chicago police department and created a cybermap of crime in that city ( In Montreal, developers put together a map of all the free WiFi hotspots ( Fans of folksinger Bob Dylan cooked up a map of his current concert tour ( complete with setlists. The possibilities are endless and not limited to plotting points on a map. Want to find out the exact walking distance between your house and your child's school? Check out the Google pedometer ( The number of map-enabled websites is growing so quickly that directories like have sprung up just to keep track of them all. The best website to keep abreast of this exploding field is Google Maps Mania run by Canadian Mike Pegg at

It's easy dreaming up exciting things you can do with maps.Wouldn't it be cool to pull up a map of any city you'll be visiting with all the hotels marked on it, click on the places you're interested in and read what their past customers think? Come to think of it, this concept could apply to just about every kind of service business, from auto-body repair shops in your neighbourhood to restaurants across town.

This is where cool gets dangerous. An online map-driven business directory that incorporated customer reviews would be a killer app, the ultimate Yellow Pages. Whoever pulls it off stands to reap billions in advertising revenue. Google has already established a beachhead by melding its maps with a geographically-based search engine to create Google Local (you can check it out at Google's home page, click on "Local"). Zoom in on your neighbourhood, type in "pizza" and you get an instant map of all the pizzerias in your area.

Smart online maps could alter the power balance in many an industry. Here's another one: North Americans paid well over US$60 billion in real estate commissions last year. Discount brokers that charge low fixed-fee commissions rather than the industry standard of six percent haven't had much success. You pay $18,000 in commissions on a $300,000 house rather than half that because the realtor industry is a cartel. At its core is the massive MLS database that lists millions of properties for sale. Selling a house without using an MLS listing is like building one without using a hammer. Discount brokers must pay for MLS access because there's been no alternative. Now take a look at a new website called It maps real-estate listings from, a popular (and largely free) classified-ad service. It makes browsing for real estate an enjoyable experience. A click of the mouse gives you an aerial photo of the neighbourhood. Very cool. And also a most dangerous development for the realtor industry. by itself won't be enough to break the cartel. But there's the makings of a low-price business model in there somewhere. All that's needed is someone who has the vision, energy and marketing skills to bring it to life. A Charles E. Schwab of real-estate. Done right, a potent discount realtor sector could emerge overnight, in the same way that Schwab created the discount stockbroker industry a few decades ago.

The first age of the Internet was all about cyberspace. Minds meeting minds, transcending geography. Map-centred websites bring real-world geography back into the picture. It's a virtual space where mind meets world. Maybe we can call this new territory, mapspace. Maps matter because they are powerful interfaces. A good map can give you an instant feel for hard-to-describe notions like location, proximity, routing, density and flow. The best mapspace applications combine an online map interface with a database whether it is traffic data, census data, gas prices - the list is endless. These are killer apps because users are attracted to powerful interfaces.

We're still in the early days of the mapspace boom and there's plenty to come. Another technology wave that'll make maps even more essential is the growing popularity of Global Positioning System (GPS) devices. Empire builders take heed: Combine a smart online map with GPS-enabled cellphones or vehicles and you get instant cool. A map that tells you the exact location of loved ones for instance. Or a map that warns you about the traffic snarls on the road up ahead.

Who are the companies that will dominate mapspace? Google is the obvious early leader. Its Google Local service, although in many ways still quite rudimentary, is now offering free online listings for businesses. This could be the beginning of a full-fledged directory service. Google has been exceptionally astute. By cannily releasing its service for outside use, it's harvested hundreds of man-years of free software development and experimentation. It's got a front seat at the cutting edge. The experiments come at a price though because the results are there for all to see. Microsoft is surely watching developments closely. Microsoft's mapping service, Virtual Earth, is a poor second cousin to Google's offering but then again a slow start has never stopped Microsoft from a fast finish. Yahoo! has a Local search engine of its own.'s A9 site has added some street-level photographs to its mapping service giving its users a tantalizing view of what the future may hold.

But who says that mapspace has to have a corporate overlord? How about an open-source alternative? Perhaps a "WikiMaps" that would use public-domain geographical databases and allow users to upload photos and local information?

The current explosion of new map-driven websites will soon be followed by consolidation. Only a handful of mapspace portals will likely be left a few years from now. Here's the scoop: Whoever dominates mapspace will hold the high ground in much of the online world . The battle's about to begin and for once, the map is the territory. May the coolest empire win.

Wynn Quon is chief investment analyst at Legado Associates (e-mail)