Connected Car 101

  • Thursday, February 18th, 2016
  • Author: Tim Maytom
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BMW 6Ever since their inception, mobile phones have been entwined with the world of cars. Back in the 1980s, as the first modern cell phones began to emerge, the battery size of most devices meant that they were restricted to being carried in cars (with at least one notable retailer’s name harking back to this era). Then in the 1990s, the feature phone boom saw mobiles become much more common, and fears about calling or texting while driving resulted in the mobile transforming into something carried with you and used at other times.

The birth of the smartphone changed all that, however. Now your mobile could be your stereo system, your atlas, your phone, and much more besides, all in one device. As other automotive technology like GPS trackers began to be integrated into the average smartphone, it became clear that car manufacturers would have to work with smartphone makers and app developers or be left behind.

Today, there isn’t an automotive manufacturer that isn’t exploring how to better integrate mobile technology into its vehicles, from in-car user interface systems that co-operate with mobile operating systems to autonomous driving systems developed in partnership with large tech firms. In fact, embracing the connected car will be central to maintaining revenue growth for automotive companies in the future.

“Both premium and volume auto makers clearly see connected car technologies as essential to their futures,” says Dr Richard Viereckl, senior vice president and leader of IP engineered products & services at Strategy&. “They also realise that overall vehicle prices aren’t rising as rapidly as the prices charged for digital capabilities. This means returns on investments in traditional car components are shrinking.”

According to a recent report put together for the Society of Motor Manufacturers & Traders, the UK’s automotive trade association, the UK motoring sector has seen production increase by 50 per cent since 2010, and is forecast to grow by a third by 2018, with connected and autonomous vehicles set to create an additional 320,000 jobs by 2030.

Big data
For tech firms, the car represents not just another industry it can generate revenue from, but also another environment that it can draw information from. In the era of big data, programmatic targeting and location-based ad campaigns, being able to connect to motorists and passengers in real-time and harvest information like what music they’re listening to and how often they’re checking maps can provide marketers with additional tools to make advertising more accurate and effective.

“Today’s vehicles have transformed from a mode of transportation into a mobile data centre with onboard sensors and computers that capture volumes of information about the vehicle and its surroundings,” says Alexander Scheidt, global automotive industry leader at IBM Global Business Services. “Successful automakers will recognise the opportunity to accommodate for this disruption by offering the digital experiences and services that consumers desire.”

Even the government is supporting the push for connected cars, with the UK investing £75m in the development of smart automotive technologies that will increase fuel efficiencies and reduce pollution, as well as a £1.5m fund specifically for developing a driverless car to be tested in a UK city centre.

With so much impetus and investment in the connected car, it’s no surprise that this year’s CES in Las Vegas was dominated by announcements of new technologies, partnerships and innovations in the motoring market. But what are the firms involved actually offering, and how much variety is there between the different solutions?

Ford: In Sync With Mobile
As the company that pioneered the assembly line and brought the first affordable automobile to the middle-class consumer, it makes sense that Ford would be at the forefront of the connected car movement. However, the firm initially relied on “brought-in” systems for its Sync in-car mobility platform, working extensively with Microsoft since 2007 and adopting the tech giant’s Embedded Automotive solution, which faced poor reviews and continued criticism from users and industry experts.

That changed in December 2014, when Ford revealed it was abandoning Microsoft for its new Sync 3 system, developed in-company and supporting both Apple’s CarPlay system and the Android Auto platform. Since then, the firm has surged ahead with innovative features like built-in cellular-connected telematics which enable owners to locate, unlock and even start their car using their smartphone.

“The technology helps you seamlessly integrate your vehicle into your lifestyle,” says Don Butler, executive director of connected vehicles and services at Ford. “Get locked out? Cold outside? Forget where you parked? No problem, just use your smartphone.”

At CES this year, Ford announced a series of new features, including voice commands for both Apple and Android apps, as well as revealing partnerships with Amazon, to explore connecting the Sync system to the retailer’s Echo smart home controller, and AT&T, to expand high-speed connectivity to 10m additional customers by 2020. The company also announced it was looking to develop technology that would integrate wearable devices into in-car mobility, taking advantage of the biometric data that these devices offer to improve driver safety.

“As more consumers embrace smart watches, glasses and fitness bands, we hope to develop future applications that work with those devices to enhance in-car functionality and driver awareness,” says Gary Strumolo, global manager for vehicle design and infotronics at Ford Research and Advanced Engineering. “Wearable technology integrated with the vehicle allows for more accurate biometric data to stream continuously and alert active driver-assist systems to become more sensitive if the driver shows signs of compromised health or awareness.”

For Ford, the trajectory is clear: the company is aiming to put its connected vehicles at the centre of consumers’ lifestyles, making the car a hub through which they can access their phone, and by extension their work, their home and their life.

VW: Charging Forward
German automaker Volkswagen is another brand that has been attacking the connected car market from a variety of angles, innovating in a number of areas and seeking out ways to stand out from the crowd. Like Ford, the company has focused on in-house solutions in recent years, bringing in talent from tech firms to create new solutions for its vehicles.

Also like Ford, this year’s CES proved a banner year for VW, with the company’s ‘V-Charge’ research project winning the Auto Bild/Computer Bild 2015 Connected Car Award. The V-Charge project aims to combine electric vehicle charging with autonomous driving, picking up on the idea of valet parking to develop a solution which automatically searches for an appropriate charging bay.

The solution enable drivers to exit their car and have it drive itself to a charging bay, with sensors ensuring that pedestrians, cyclists and other vehicles are avoided. Not only that, but it will also vacate the charging bay once it’s fully recharged, enabling new vehicles to take its place. All of these processes can be controlled by the driver on their smartphone, which can also be used to summon their car back once they’re ready to depart.

Automated driving seems to be the lynchpin of VW’s efforts in the connected car space, with Dr Herbert Diess, chairman of the board of management for VW, saying that automated driving will become central to our everyday lives and “change mobility completely” in his keynote speech at CES. It was at CES that the firm chose to reveal its new Budd-e concept vehicle, a four-wheel drive electric MPV that was marketed as “a gateway to the future”.

As well as its cutting-edge electric motor, the Budd-e boasts a high-definition dashboard with internet-enabled infotainment functions, a gesture-based control system and a lounge-style rear passenger section that includes an internet-enabled television mounted on the side of the interior. Much like the Mercedes-Benz F015 which debuted at last year’s CES, the Budd-e isn’t likely to be found at a dealership near you any time soon, but the features seen in the car will surely trickle down to the next generation of connected car.

BMW: From Here to Mobility
BMW is another German manufacturer that’s been embracing the power of connected cars, but it hasn’t been doing it alone. Along with Mercedes-Benz owners Daimler and Audi, the firm purchased Nokia’s Here mapping software when the unit was sold off by the smartphone maker in August 2015, the consortium spending a combined €2.5bn (£1.9bn) to secure the technology.

While owning an intelligent mapping and location system which already operates in almost 200 countries and in over 50 languages is a useful asset in itself, the main rumour surrounding the consortium’s purchase was that it would be used to power self-driving cars.

BMW has stayed quiet on this front since the acquisition, instead focusing on its ConnectedDrive services which it has integrated into multiple models, and which recently opened up to IFTTT customisation, enabling the connected car to do things like open smart garage doors on approach, or even tell intelligent lights to switch off when you leave home.

The use of IFTTT not only allows the car to serve as a smart object within a larger ecosystem, all controlled from a smartphone, but also puts the reins in the hands of consumers, allowing BMW to observe how people choose to make use of the technology, and base future decisions on innovations and trends the public dictate.

Of course, this doesn’t mean BMW has been slouching when it comes to innovation either. At CES, the firm introduced its AirTouch gesture control system, which enables drivers to make detailed and subtle control motions which are picked up by sensors within the car, giving greater control while still enabling drivers to focus on the road. There were also features like gesture controlled automatic parking, heads-up displays for motorcycle helmets, and a cloud-based mobility platform that enables owners to interact with their car and wider ecosystem of smart objects from wherever they are.

Still, like Ford and VW, the trajectory of BMW’s innovation is clear – preparing the way for autonomous driving, and transforming the car into a digital hub that enables people to communicate with their home, their family and their life while on the go.

The fast lane to the future
“The connected car is more than a new package of automotive technology features,” says Dr Viereckl. “It’s a disruptive technology that will upend traditional auto industry structures, usher in new business models, and change the nature of the business. The automobile is rapidly becoming a ‘thing’ in the Internet of Things.

“Skeptics who doubt the impact of autonomous driving may be convinced by the impact it has on the traveling experience. Freed of the need to keep their hands on the wheel and their eyes on the road at all times, people can turn their attention to other activities as they travel along the highway. They will watch movies, shop, engage in social communication, or conduct virtual conferences.”

The dawn of the autonomous car, whether it’s in the form of completely self-driving models like those being developed by Google and (reportedly) Apple or more passive capabilities that expand on automatic parking and safety features already available, will radically transform the automotive industry. The car will no longer just be a vehicle, but also a bundle of services and apps, much like phones have transformed from a communication tool to the central tool through which we interact with the world.

Much like smartphones, it will also mean the tech companies who are providing these services will have a huge impact on the way we live and the way we communicate, opening new avenues for data collection, targeting and marketing that we can’t even imagine yet.

It could also mean dramatic changes in consumer behaviour, with shared-car services like Uber and Lyft transforming into specialised vehicles that combine private and public transport using complex networking and algorithms to manage hundreds of thousands of people travelling at a single time.

With huge tech firms like Google, Apple and IBM all actively invested in the future of the car, the next 15 years promise to see the most dramatic, disruptive and exciting changes in automotive technology since the Model T first rolled off the assembly line.

This article first appeared in the February 2016 print edition of Mobile Marketing. You can read the whole issue here.