Apple Inc. (AAPL) is likely to switch to its own mapping app later this year, replacing Google Maps, as the technology giant launches its next version of mobile operating system iOS6, the Wall Street Journal reported. Currently, Google Maps is the default map service in iPhone and iPad.
The iOS6 will introduce 3-D mapping features developed by the Cupertino, California-based company. Apple may preview iOS 6 at its annual Worldwide Developers Conference keynote on June 11.
Google's map service, which allows users to get directions among other services, has been immensely popular with iPhone users. It is estimated that over 90 percent of iPhone users in the U.S. use this service. As iPhone sales rose, traffic to Google's search engine through the map service also increased significantly.
It appears that Apple has been working on the idea of developing own proprietary mapping service for long. The company acquired at least three map companies with this aim. The plan gathered momentum as shipments of smartphones powered by Google's Android software exceeded that of iPhones.
Last fall, without much fanfare, Apple launched a geocoder, which translated a phone's longitude and latitude into a point on a map. Until then, the technology firm had relied on Google's geocoder.
Mobile ads, related to locations or maps, are said to account for 25 percent of $2.5 billion spent on total mobile ads. This is a significant increase from the 10 percent contribution it made in 2010.
Yet, by developing its own map app, Apple is said to be looking more at having a firmer control over a key asset, compared to the ad revenue it will bring. The company believes it can offer features that Google does not offer in its map service and thus lure more customers.
Meanwhile, Google is holding a press meet today demonstrating "the next dimension of Google Maps." If Apple launches its own map service, it is likely to hurt Google's map-related revenue. In the short-term, along with loss of ad revenue, Google will also lose some data on search interests by local businesses.
AAPL, which closed at $562.83 on Tuesday, is adding 0.6 percent.
GOOG is adding 0.7 percent in pre-market trade, after closing at $570.41.
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