Telematics and the ‘built-in’ vs. ‘brought-in’ debate

Cathy

Cathy Conneff

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28th October 2011

At the 2011 International Motor Show in Frankfurt, Germany, the goody bags had “Audi Connect” written all over them, reports Anna Buettner, a senior automotive analyst with IHS iSuppli.

“This is their focus now,” she says. “Technology is selling cars.” But as automakers push to meet their customers’ technological demands, they must decide whether to deliver the data link through an embedded onboard system or via the customer’s mobile phone.

Ford maintains that its Sync system boosted sales, although adapting to Europe’s array of languages has repeatedly delayed its introduction there. BMW says the same about its ConnectedDrive.

“People really do want to stay connected,” according to Buettner. If you can email from your car, “that’s a value add.”

The embedded option

Today’s embedded telematic systems focus largely on features like crash notification and emergency location.

These are managed through the automaker (which may have a mobile phone company or telematic service provider as a partner) and are either included in the price of the vehicle and/or billed periodically. BMW in Europe also offers full Internet access and browsing via an embedded system along with its safety and security features.

But an Internet connection made with a smartphone has proved much faster than BMW’s embedded system in many tests, and the embedded system can only be used while parked, Buettner notes.

Johan Wideberg, director of external relations for ETSI, the European Telecommunications Standards Institute, believes in the near future there will be cars that feature a selection of embedded telematics capabilities as well as an option to download additional apps for the vehicle’s system, as users currently do for their smartphones.

However, he says the car itself can be limiting factor: “Normally, a cell phone is a much more powerful computer than a car.”

Some OEMs, including BMW and Audi, are embracing elements of both options: embedded technologies included in the cost of the car or billed through the manufacturer as well as online applications that rely on a mobile phone’s data connection to function.

This kind of hybrid approach may be the ultimate winner, as OEMs balance the bottom line with delivering the ease of use and array of options consumers expect.

Despite the limitations of strictly embedded systems, OEMs like the control they offer, Wideberg explains.

Diagnostic alerts and requests for roadside assistance connect the driver to the auto manufacturer—or at least to the service provider of the OEM’s choice. “That’s their business,” says Wideberg. “If they give you too much data, it will take away their business.”

If the vehicle tells you when there’s a problem, rather than the manufacturer, you can go to any garage you want. (For more on data use, see Telematics and the connected car: How to deal with increasing data use.)

Buettner points out that a more transparent system might also enable “smart bundling” for drivers whose mobile phones use the same provider as their vehicle’s embedded system, or who might consider changing providers to make this the case).

But she believes this option unlikely because it would also require auto manufacturers to “let go.”

The piggybacked approach

Right now, only two OEMs have operating telematic systems that run via a mobile phone connection: Mercedes Benz and Toyota, reports Buettner. Both use Bluetooth to connect the phone and vehicle, but Mercedes Benz does not currently support the iPhone, though it hopes to do so by 2013.

The company taking the lead in smartphone integration is BMW, Buetter adds. Yet BMW’s telematic system does not depend on a mobile phone for all its functions.

One appeal of these piggybacked systems is their streamlined billing. “Users don’t want five different contracts,” Buettner says.

The connectivity used in the car just goes on the driver’s existing mobile phone bill; an unlimited data package is suggested. Those who already have an unlimited data plan are probably more likely to opt for this sort of in-car solution. (For more on data plans, see Telematics and the search for a universal data plan.)

However, these mobile phone-connected systems are not without their limitations. Relying solely on the phone means there’s no link to the vehicle itself, so there’s no means for remote start or comfort setting adjustments. An embedded module is needed for those features, so Buettner envisions a future where luxury brands include an embedded system in addition to whatever else is possible via integration with drivers’ smartphones—the hybrid approach.

If OEMs seem to be taking tentative steps forward, it may be because many are waiting to see what happens with the eCall initiative in Europe and its current 2015 deadline. Once eCall is required, a variety of other services could be created to piggyback on this universal device.

If carmakers opt for a mobile phone-based system in the meantime, they’ll have to add the embedded module when it becomes compulsory. Uncertainty “holds OEMs back,” says Buettner.

Wideberg concedes that car manufacturers may be more secretive and prone to creating proprietary standards, but he hopes they will “get over their hurdles.” Whether the system is embedded or phone-based, “open source makes things easier for everyone,” he says.

Jessica Royer Ocken is a regular contributor to TU.

For more all the latest telematics trends, join the sector’s other key players at Telematics Munich 2011 on November 9-10 and Content & Apps for Automotive USA 2011 on Nov 29-30 in San Diego.