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Latest Blog: Telematics helps automotive industry shift gear
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Latest Blog: Telematics helps automotive industry shift gear

Posted by Macario NamieJuly 5, 2011

The stage is set for telematics to make waves in the automotive industry, but what are the factors driving this change and what role will mobile operators, car manufacturers and technology partners play in this new ecosystem?

Telematics has the potential to revolutionise the automotive industry in the same way that smartphones have revolutionised the telecoms industry. From a rise in consumers looking for simple telematics solutions that offer ease of navigation and straightforward vehicle diagnostics, to those looking for in-car infotainment, M2M solutions in this sector are witnessing a rebound due to a surge of devices aimed at creating customer value.

With a shift away from aftermarket vendors offering extravagant aesthetic features, the market is witnessing a surge of original equipment manufacturer (OEM) solutions from car manufacturers and device manufacturer as consumers look for value-added services that deliver a superior driving and ownership experience.

Telematics enables OEMs to engage with consumers beyond the initial showroom exchange. Ongoing conversation between OEMs and consumers ensures that OEMs understand the needs of their customers and can adapt their value-added services accordingly. Additionally, telematics allows car manufacturers to promote brand awareness after-sale by allowing them to become dedicated service providers.

In becoming service providers, OEMs open the door to a new realm of responsibility. Failure to respond to consumer frustration or dissatisfaction could have a detrimental effect on the brand. Providing value added services means opening a communications channel and OEMs must consider the active role necessary to support and service this new channel.

For example, with OEM telematics solutions such as BMW’s ConnectedDrive – which connects consumers to their vehicle through a range of mobility, including in-vehicle internet access and remote diagnostics – BMW owners see BMW as the service provider, responsible for their connected Assist services. BMW must manage all aspects of service delivery, technical support, subscription management, provisioning and more.

When it comes to telematics, the network operator behind a connection is invisible to the end user. Operators, for their part, must have the solutions in place that enable OEMs to become service providers.

This is where technology partners enter the equation. By partnering with M2M platform providers, operators and their customers can enable global connectivity to encourage business across borders and around the world. Technology partners can eliminate the business complexity associated with monitoring and servicing new devices in real-time, ensuring OEM telematics offerings are equipped with the intelligence, provisioning and support necessary to service the demanding consumer market.

Just as we have witnessed the rise of mobile applications in the telecoms realm, the impact of applications has begun to spread into telematics, with an array of car and device manufacturers quick to get their apps on the market.

New OEM applications rely on the connectivity of the driver’s smartphone or the embedded modem found within the vehicle. The latter allows from a much deeper synergy between the vehicle on-board diagnostics and interfaces and the consumer application.

For example, the Nissan LEAF – the new electric vehicle designed by Nissan – has launched an app designed to help consumers manage their vehicle and control many frequently used features directly from their smartphone device.

Other players in this space include Ford Motor Company, who has partnered with AT&T to pursue telematics opportunities. The My Ford Mobile smartphone app, which allows Ford Focus Electric vehicle owners to send and receive data about their car while away from it, highlights the opportunity for car manufacturers to connect consumers directly to their vehicles and is a positive example of the new innovative fashion of offering consumers simple interaction with their vehicles via tools already available to them.

The integration of smartphones and smartphone applications in vehicles is a testament to the interest in consumer telematics markets. OEMs, telematics service providers, device manufacturers and software developers are all rushing to take advantage of the automotive industry’s move into the smartphone application arena.

Device manufacturers have also been quick to take advantage of consumers’ prolific smartphone usage and the growing demand for applications. Garmin recently announced its Garmin Mechanic application which offers consumers an accurate look at how their vehicle is performing. Though Garmin is offering the application free-of-charge, the company has paired it with its ecoRoute HD module to offer an advanced value-added service that offers diagnostics codes, real-time sensor data and fuel consumption, and acceleration calculator direct to consumers’ handsets.

Aside from smartphone uptake, the key market driver in the European telematics market is European eCall. Mandatory pan-European eCall is currently being considered by the European Commission and could lead to all new vehicles being equipped with a GSM module and GPS or Galileo chipset.

In the event of a serious car accident, the eCall system automatically dials the nearest emergency centre. It thus informs the rescue services about the accident and transmits the exact location of the accident scene to them.

The eCall Memorandum of Understanding (MoU) has been signed by 21 European countries and, if passed, could add billions to the European telematics market.

eCall is testament to government regulations’ ability to shape telematics growth. The adoption of global standards throughout the industry will encourage wider adoption and lower development costs, contributing to the success of both the consumer and commercial telematics industries. OEMs are also beginning to set industry standards, with BMW’s Next Generation Telematics Protocol looking to establish a more stable and uniform interface infrastructure for delivering end-to-end telematics services, open to all telematics providers and vehicle manufacturers.

The self-diagnosing vehicle is becoming a reality, with OEMs, service providers, device manufacturers and software developers all competing for revenue in this growing market. Through strategic partnerships, OEMs have the opportunity to drive innovation and service the rapidly changing needs of the industry.

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Macario Namie

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