On Tuesday navigation provider TomTom announced that it would be the new map provider for Apple, Inc. Upon the agreement, TomTom shares rose close to 12 percent in Amsterdam. Shareholders are confident that the deal will be lucrative for the company. Analysts believe that close to $625 million annually is used on mobile ads related to maps.
The new partnership was announced in a statement released by TomTom saying it had "signed a global agreement with Apple for maps and related information." The company did not provide further details and do not plan on doing so.
The announcement came following Apple's decision to drop Google as its navigation system in the heat of the two companies' competition.
The new navigation program is expected to have better performance in comparison to the prior Google mapping system, as it allows Apple to refine the app and make it more accommodating to their iOS products and hardware.
TomTom, which is based in Amsterdam, creates maps that spand across over 200 countries and more than 35 million kilometers. The TomTom navigation system will be a part of the maps app in the iOS6 when it becomes available in the coming months.
Included in Apple's map app is what the company refers to as "Apply-designed cartography." This entails turn-by-turn directions, traffic information, 3D-looking fly-over mode, and vector-based map components.
"We believe that TomTom will not only deliver maps, but will also offer content and its highly valuable [high definition] traffic service," Rabobank analysts said, according to Dow Jones Newswires.
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