Consumer Telematics Show Focuses on Opportunities and ...

January 10, 2013 by Kitty Weldon

Kathryn Weldon

Summary Bullets:

• Consumer telematics (aka the connected car) is an exciting market, as auto OEMs are associating new infotainment and safety applications with their brands and experimenting with different subscription models.
• Mobile operators have a huge stake in this market as they have an opportunity not only to increase connections but to participate in the larger value chain that includes embedded modems and smartphone integration, along with sales, marketing, subscriptions/service enablement, support, content delivery, and consulting and integration services.

The Consumer Telematics Show (CTS 2013) in Las Vegas on January 7 brought together the unique ecosystem that is delivering solutions for the connected car market, including auto manufacturers, chip and module manufacturers, operators, integrators, and content providers. While there is a lot of excitement about the opportunity, there also remain challenges:

• The respective lifecycles of an auto and of consumer devices and applications are very different; there needs to be a way to sync them in order to upgrade a car with the latest technology and features. Integration of smartphones (in addition to installation of embedded modules) is a logical way to accomplish this, but there remains a debate about these different kinds of connectivity methods. Are they both necessary?
• The user interface is hugely important. Safety is paramount; the driver must not be distracted from driving so the interface needs to incorporate voice commands or simple one-button push to enable applications. At the same time, consumers (drivers and their passengers) want to be able to access the same kinds of content (beyond navigation and points of interest) they can get at home or on their smartphones ? internet access, music, news feeds etc. as well as audio/video-conferencing and video content.
• Business models are still emerging. How are subscribers going to pay for these advanced features? Will usage-based fees, monthly fees, or upfront purchase of the car with tiered feature packages be used? Will there be an in-car or cloud-based app store that allows consumers to select and buy apps on the fly? Will operators, OEMs and the rest of the ecosystem be able to profitably monetize the solution elements profitably?
• Different market segments have unique requirements. What works in the US may not work in Europe, let alone in China. What is considered a high-end luxury car feature may not be necessary as connectivity works its way down into the mass market.

Still, there remains much enthusiasm and excitement about the opportunity; automotive telematics is an M2M vertical with one of the highest projected number of connections and revenue-growth expectations. There is also a kind of tug of war about control between auto OEMs, mobile operators, and content providers that may all have to share revenue. So they must learn to get along.

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Source: http://itcblogs.currentanalysis.com/2013/01/10/consumer-telematics-show-focuses-on-opportunities-and-obstacles-for-connected-car/

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