Investigation of Nokia and Navteq moves forward

Mobile phone maker Nokia is now running into more opposition from the European Commission over proposed plans to buy digital map maker Navteq.

In a written statement on Friday, the manufacturer said that it has decided to open a detailed investigation into the deal, after an initial market investigation "identified serious doubts" about the possible buyout's "compatibility with the Common Market."

Along with Tele Atlas, a company that portable navigation (PND) vendor TomTom is now trying to buy, US-based Navteq is one of only two producers of navigable digital maps offering complete coverage of both Europe and North American. TomTom and Tele Atlas are both based in The Netherlands.

On Friday, the Commission voiced concerns that an acquisition of Navteq by the Norwegian-based Nokia might, "in the light of the duopoly market for navigable digital maps and Nokia's strong position [in] the market for mobile handsets, lead to a significant impediment of competition."

Nokia, of course, is hardly the only company to be investigated by the EC around suspicions raised about activities that might possibly carry anti-competitive impact. After another initial market investigation, for example, the EC found earlier this month that Google's proposed acquisition of DoubleClick would not produce "adverse impact on competition" in the online advertising services market.

In its statement on Friday, however, the EC said that Nokia's intended buyout brings up issues similar to those involved in TomTom's proposed merger with Tele Atlas, another deal now in the throes of a detailed investigation.

The EC also said that its investigation of the Nokia deal will focus on whether the transaction might "increase the costs of navigable digital [maps] for other companies providing navigation services on mobile handsets or limit their access to these maps, and as a consequence harm consumers."

The Commission now has until April 17 of this year to make a final decision on whether TomTom's buyout of Tele Atlas would "significantly impede effective competition within the EEA or a signficant part of it," and until August 8 to make the same kind of determination about Nokia's proposed merger with Navteq.