Wednesday, June 07, 2006

Map Mania

Megha Bahree, 06.05.06

From Google Earth to tracking the avian flu virus, map software suddenly is hot tech.

The Web has gone map mad. Ever since Google released easy-to-use software tools for its nifty on-screen maps of streets and satellite images a year ago, fans have set off an explosion of creative overlaps, adding their own useful and sometimes quirky data.

One map locates dog-friendly hotels in the U.S., another tracks taco trucks in Seattle (with photos and health inspection records of the trucks). A map of upcoming Native American powwows marks each site with a blue eagle feather instead of a virtual pushpin. The Gawker Stalker map of celebrity sightings in Manhattan got George Clooney so mad he urged people to flood the site with fake posts, Gawker says.

Google started this binge on maps and "mash-ups"--loading simple maps with extra information--last June, and Yahoo and Microsoft's MSN have recently helped fuel it with features of their own. Silicon Valley cartographers held their first mash-up camp in February in Mountain View, California, drawing 300 people; 500 have signed up for the next one, in mid-July.

All this geographic mania amuses the de facto father of the mapping field: Jack Dangermond, founder and president of Environmental Systems Research Institute, the 37-year-old firm that is the Microsoft of mapping. ESRI, run out of Redlands, California, has annual sales of more than $600 million and is growing at better than 10% a year. It claims to be one of the largest suppliers of software to the federal government after Microsoft, Oracle and IBM. It is owned entirely by Dangermond, one of four children born to Dutch immigrants, and his wife, Laura, who also grew up in a modest home.

ESRI's 300,000 customers include most federal agencies, health departments in all 50 states in the U.S., the Centers for Disease Control & Prevention, oil and forestry companies and more. ESRI maps are used in all cars equipped with General Motors (nyse: GM - news - people )' OnStar service. Its tools also track cholera and malaria in Bangladesh and India, guinea worm in West Africa and West Nile virus in the U.S.

ESRI's software's key strength is the "club sandwich effect" by which customers handle advanced spatial analysis with up to dozens of layers of data from economic, demographic and environmental databases. ESRI street and satellite maps can be updated almost instantaneously as new information streams in from the field.

Dangermond is a bit dismissive of Google's efforts, viewing its mash-ups as so much eye candy. Yet ESRI itself, until now focused mainly on high-end corporate and government clients, is responding to the Google excitement by making its latest software features available online to the mapping masses. "Because of Google Earth," Dangermond says, "people became more aware of" using geographic information systems (GIS), "and they now understand what we're doing. We're seeing a lot of business customers realizing that geography matters, location matters."

The low-key Dangermond says revenue will rise nearly 15% this year and will grow more than 20% in each of the next two years, once ESRI releases the next big version of its GIS software. "I'm not telling you these numbers because of Wall Street," says Dangermond. "We don't march to that kind of drummer." The firm won't disclose its profits, but Dangermond says his operating margins run around 15%, and the company plows 20% of revenue into research every year.

ESRI's publicly traded competitors, including MapInfo, Intergraph and Autodesk, are all growing nicely, too, and they often outhustle ESRI in markets such as direct mail targeting and retail store site selection. Cox Communication used GIS software from MapInfo to combine data about its customers, service offerings and broad demographics to figure out what products to market where and even where to build its networks next. Within ten minutes of assembling the data, Cox had a decent list of direct mail targets.

ESRI's rivals have made inroads into its stronghold in government and public health agencies. But its new release, called ArcGIS 9.2, will let any user publish a map online so it can be revised by another user, like a Google mash-up but with far more sophisticated data sets. The primary interface will be a very cool 3-D globe that lets you zoom around from place to place by simply entering an address or even a phone number, something you can't do on Google.

Up until now ESRI's software has been a tool for geo-geeks, many of whom have gone in for some training in GIS. Its maps are far less sleek and responsive than the simpler Google and Yahoo maps. The map on ESRI's Web site, showing driving directions to its headquarters, is inferior to Google's version of the same.

But with the new release ESRI will make big use of standard Web languages such as XML and Java to create maps far easier to use--and more fun--for clients. In one demonstration an ESRI engineer zoomed to within 6 inches of a building rooftop in Los Angeles. Another demo plotted a route from Greenwich Village to Wall Street in Manhattan and smoothly flew overhead along the route.

Dangermond doesn't see Google as a competitor ("We like those guys"), but he admits his software needed to be prettier and quicker. "I've watched our software grow for 35 years," he says, "but this release is more technology than we've ever released in 35 years."

Falk Huettmann, a wildlife ecologist at the University of Alaska's Fairbanks campus, uses ESRI software to track the spread of the highly contagious H5N1 bird flu virus. To a comprehensive terrain map of Alaska he adds data on avian flyways, urban settlements, hospital locations and climate. This mishmash will let him decide where to send field-workers to test for infected birds, plotting the risk of the disease spreading and the chance of setting up a secure quarantine.

Ten years ago ESRI started investing in partner companies in Asia, where it earns an annual revenue of around $250 million. Today it has subsidiaries in Japan, China, India, Malaysia, Thailand, Australia and New Zealand.

"In the last three to four years our companies in Asia have been seeing a 20% to 30% average annual growth, reflecting the growth of the economies there," says Dave Byers, head of ESRI, Asia-Pacific Region. The product has been localized and can "speak" in 27 languages. For instance, in two Hindi-speaking states in northern India the government has used GIS to plot parcel data. The output, which is used by local officials and farmers, is in Hindi. ESRI India's sales have gone up from $500,000 to $10 million over the past ten years.

Several countries have also used GIS to track diseases. In India it is being used to track malaria and identify the areas prone to breeding mosquitoes. It was also used by the government of Hong Kong to track the outbreak of SARS in 2003.

After the Asian tsunami ESRI India set up, for free, a center in Cuddalore in Tamil Nadu in the south to map the villages that were affected and offered information on the population of each village and the damage sustained.

For Dangermond's customers, location is everything. "People want the geographic advantage," he says.



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