Connected cars in a connected era

The connected car sees multiple industries, technologies, and ecosystems with converge with different business models, says Frost & Sullivan’s Krishna Jayaraman

The connected era is leading to the integration of multiple industry domains, bringing together communications, automotive and consumer electronics. Currently, most automotive OEMs are promoting proprietary systems with specific eco-system partners, and the argument about open or closed architecture platforms rumbles on. With companies like Google and Apple entering the mix, the revolution is starting; Android and iOS are shifting from smartphones to become automotive standards.

At International CES 2014, Google announced its open consumer electronics development ecosystem for the automotive industry. The Open Automotive Alliance consists of Google, GM, Honda, Audi, Hyundai, and chipmaker NVIDIA, and will focus on allowing OEMs to easily bring cutting-edge technology to drivers. Additionally, Google is commercialising its Google Glasses technology, with Hyundai already listed as one of its partners for the 2015 Genesis. Also at CES, BMW demonstrated a way of controlling its new i3 electric car with Samsung’s Galaxy Gear smart-watch, using Bluetooth wireless technology.

Another major trend in connected vehicles is over the air (OTA) updates: 60-70% of recalls in major automotive markets like North America and Europe due electronic faults are software-related. From a vehicle manufacturer perspective, OTA updates provide several advantages. As well as cutting operating costs, including warranty and recall costs, they provide the ability to offer new functional updates to customers. Managing software remotely and offering timely updates has been a major challenge over the lifecycle of the vehicle. Now OEMs like GM, Audi, Mercedes-Benz, BMW and Toyota are working on 4G LTE technologies, which offer higher bandwidth and will aid timely updates, and Tesla has conducted several successful OTA updates.

Collaboration of consumer electronics and automotive

frost-diagramInfotainment systems are evolving from a closed loop of technological limitations to an open ecosystem. This has been influenced considerably by end users’ familiarity with smartphones and the availability of in-car Internet connectivity. The impact from the smartphone domain is evident in consumer demand for applications, and this has already been taken into consideration with OEMs creating applications for various functionalities, like remote services, diagnostics, navigation, social networking, radio and entertainment. MirrorLink 2.0 and HTML5 are among the prominent technologies being used to bring the best of smartphones into the car. That OEMs are introducing dedicated app stores shows the influence of the smartphone industry.

The constant issue: driver distraction and HMI

Automotive OEMs have to stay abreast with technology implementation for brand differentiation, while making sure it’s not dangerous for the driver; the process of human interaction with the car should be easy and simple, to provide a safe driving environment. A major part of developing a human machine interface (HMI) solution process is driven by consumer preference for various controls in a car; designing an interface that is complicated and has a long learning curve does not serve the purpose. For example, the greater the number of sub-menus a driver has to go through to access a particular feature, the more the time the driver’s eyes are off the road. In the case of touchscreens, drivers need to look at the screen to keep track of applications that they access.

On the visual side, there has been a focus on splitting information between available displays like HUDs, clusters and central displays. While the touchscreen is becoming a commodity, technologies like touch-sensitive buttons, gesture control, and handwriting recognition are gaining popularity. Interestingly, despite the potential for natural voice recognition to reduce distraction, a study by the AAA suggests that sending a text or an e-mail is potentially dangerous and adds mental stress. This, coupled with minor errors in recognition of accents could distract drivers. In the same way, European luxury OEMs are reluctant to implement touchscreens, as they believe the act of reaching out to touch a screen could be dangerous. Nonetheless, the idea is slowly changing with technologies like haptic feedback and proximity sensing becoming a reality.

The connected car and Big Data

bmw-galaxy-gearThe growth of Big Data is being led by the growth of connected vehicle technology. The ability to collect gigabytes of data from an array of sensors and control units creates the possibility of offering a multitude of services to end users. There is a need to harness partnerships with crucial ecosystem partners who can use this data for value-added services. From a consumer perspective, it might look like integration of a connected ecosystem with smart cars, smart devices, smart homes and a smart environment – but what does it mean to the automotive industry?

The opportunities provided by Big Data are numerous, encompassing an array of services like prognostics, vehicle relationship management (VRM), fleet management solutions, insurance, digital retailing, and location-based services like traffic information and parking. The real deal for OEMs here is to have a Big Data framework; a clear connectivity strategy with the ability to pull large volumes of data, and most importantly, partners to help them harness the true power of this data. Some examples include Ford’s capability to collect 25 gigabytes of data per hour and GM’s OnStar, which collects real-time data from the car, analyses it and gives the information to the user.
Although the opportunities are numerous, so too are the concerns; the debate over privacy and connected cars is one of the key challenges to the successful use of Big Data, with growing unease among consumers about the collection and sharing of personal data.

Automated and connected: leveraging information overload

One of the prime reasons for the transition to automated driving is driver distraction, which has risen with the growth in information and communication technologies. In-vehicle connectivity will be one of the major game changers in the services segment. In automated vehicles, OEMs would have the freedom to offer maximum services in the infotainment domain as distraction will no longer be a restraint on the content delivery. Services like Internet browsing, gaming and video playback will be allowed and will open up multiple business opportunities.

Safety and security features, like eCall and bCall, are referred to in the post-crash scenario, so telematics (V2V and V2X) will play a significant role in communicating, sending and receiving data, as well as extending the reach of digitisation. The next generation of content and apps will have to add value to the customer based on valuable vehicle data that OEMs need to open up to third party developers, such as the Ford Bug Labs OpenXC project. Opening up vehicle data will also allow entrenched IT companies to add valuable analytics on the data and provide value to OEMs, drivers and dealers through dedicated portals that will go beyond static diagnostic emails and alerts. Autonomous vehicles will also aid the insurance telematics market, with controlled driving enabling users to be entitled to insurance benefits and reduced premiums.

The car of the future

hyundai-genesis-google-glassThe connected car is the convergence of multiple industries, technologies, and ecosystems with different business models. This is a potential revenue stream for OEMs who are offering more connected services. Amidst the challenges of keeping the HMI easy, cost-effective, and reducing distraction, OEMs are focused on potential revenue streams and brand differentiation.

Frost & Sullivan expects more than 90% of the vehicles in 2020 to be connected; there will be a wide array of services irrespective of vehicle segment. The future systems will have a specific set of standards to make it future proof, and the answer will be to counter distraction with technology. OEMs are likewise taking different approaches; the debate will be between tethered (brought-in) or embedded technology. Packaging telematics services with connectivity will dominate: OEM strategies will involve packaging solutions and data plans as a part of the vehicle offering. Clear strategies implementing data from all vehicle systems and adhering to common standards will lead to a connected era.

This article was first published in the Q2 2014 issue of Automotive Megatrends Magazine. Follow this link to download the full issue

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