The Connected Car IVI Opportunity: Lessons from Mobile -AppCarousel
We have been in the mobile device industry for over adecade, creating and operating app store platforms for large telecommunicationscompanies. During that time, we have seen the incredible evolution of thewireless industry. Now, as a member of GENIVI and a supplier to companies inthe automotive sector, we are witnessing major change in the IVI market. Forsome of the changes we can draw parallels with mobile, while others are uniqueto vehicles. This short paper gives some perspectives on the challenges andopportunities for apps, content, data and value-added services for theconnected car.
Key Observations about the Connected Car
The in-car app and content world will be very differentto mobile
Apple’s and Google’s stores both have more than a millionapps each. Drivers will not tolerate having to browse through hundreds of newsapps just to find the one that works best in their vehicle. Instead they willwant top quality, highly relevant, curated experiences that add value to theirdriving experience, and if the car industry gets it right, those drivers won’trealize they are using apps at all. We don’t see the need for mobile-type appstores in the car. Instead we see those apps, services and infotainment feeds,being delivered in a seamless manner, as part of a managed service and as anextension of the car manufacturer’s brand.
Connected car will see as many battles as mobile
One obvious battle will be for the operating system. Willdashboards be fully open, dominated by Apple or Google, or proprietary like inthe old featurephone days? It’s a land grab, and each automotive OEM also wantsto differentiate, so we may not see clear leaders for several years. Will thein-car screen dominate or the driver’s mobile phone? As drivers won’t care somuch about a vast choice of apps and services, the battle may shift fromplatforms to the finesse and execution of the in-car experience.
From the developer’s perspective they don’t want to seebattles; they want to see standardization so they can build once and deployeverywhere. Fragmentation is never a good thing for developers, and it’splatform fragmentation that drives so many of the battles of exclusivity, lackof availability across devices, and ultimately added costs. Our experience inmobile tells us that this is short-sighted and that tools like HTML5 will helpthe IVI industry break away from proprietary systems over time.
The car today is like yesterday’s featurephone
Consumers today can make their smartphones exactly whatthey want them to be, as there’s an app for almost every use case imaginable.Whereas, to a large extent, once you buy a car, you interact with the samefirmware for the life of the car. Cars are however becoming moresoftware-based. Today updates may be performed at the dealer’s workshop,tomorrow it will be SOTA (Software Over The Air). As users demand more featuresand customizations over time, and as car manufacturers drive to keep theirvehicles relevant and up-to-date, cars will move from being like featurephonesto being like smartphones. An entire software management industry forautomotive will appear.
How is the car connected, and what are the implications?
There are several ways for cars to connect. Manymanufacturers are looking to deploy black-box cellular modules in every car,making deals with the network operators across all of their markets. Bluetoothis now ubiquitous so the car can easily piggyback onto the driver’s personalmobile phone. Of course, Wi-Fi is easy and cheap to add to any new vehicle, sothere is no shortage of connectivity options.
In the world of smartphones, there is a generalexpectation that the user needs to be online and connected in order for mostapps and services to work. However in automotive, almost every feature on adashboard will be expected to work irrespective of whether the car isconnected, just as today’s GPS satnav devices all work without an internetconnection. Apps that are deployed in the car therefore need to be designed towork offline as well as online, and the scheduling of SOTA updates will need toconsider the car’s connectivity options.
The connected car is as much about IoT / M2M as it isabout IVI
There are two drivers for connecting the car. One isin-vehicle infotainment IVI), the other is telemetry otherwise known astelematics. Some call it machine to machine (M2M), others call it the Internetof Things (IoT). Whatever you call it, we think of the car as a connecteddevice which collects enormous amounts of data, from internal data such asengine statistics, to its external environment such as outside temperature, anddriver behavior characteristics.
Consumers will benefit by having all their assetsconnected (for example, the car will turn on the house lights and open thegarage when it is approaching). Car manufacturers will dive deep into â€œbigdataâ€. Service providers such as traffic and weather companies will use the caras a moving sensor. The two use cases; IVI and IoT, will interact such that aweather app on the dashboard will know there is ice ahead thanks to the cars infront. Ultimately the connected car will give rise to smart cities where carsdrive themselves while the passengers enjoy in-vehicle infotainment.
The connected car has a different value chain to mobile
A phone is typically owned for 18 months, whereas a caris on the road for more than 10 years. So, choosing vendors for the long run iscritical. Having an IVI solution that can adapt during those 10+ years isessential, which can be achieved by having flexible APIs that connect thevehicle to the cloud. In this way, the head unit interface in the vehicle canbe defined, and the apps and content feeds that interface to it can beenhanced, upgraded, and efficiently managed as time passes.
Having different vendors for the in-car software, in-carhardware, cloud services, content and apps means tight collaboration and tightintegrations â€“ based on those APIs that connect them all together. The car willbe as easily differentiated via its apps and services as it is today from itsaccessories and trim.
The key to a successful IVI platform will be a rich setof APIs that third party cloud providers can use, in a tightly controlledmanner, to connect to the car, provide IVI services, and access car data topersonalize their offerings.
Monetization will be different to mobile; there will notso many 99c apps, but rather far more valuable services based around apps thatusers will be prepared to pay a subscription to their manufacturer or dealerfor.
The connected car is a true multi-screen environment
Drivers entering their car don’t suddenly turn off theirphones as they do on airplanes. At the most basic level those phones need topair with the vehicle for calls. However, there is a growing movement in IVI toprovide heads-up displays of their favorite mobile apps on the dashboard. Thatrequires developers of mobile apps to embrace the in-vehicle form factor as asecond screen. It also requires an understanding of the functions a driverwants compared to a mobile phone user. The other way round, if a driverdiscovers a great service on the dash, he should be able to continue thatservice on his mobile. Even within the vehicle we will start to see multiplescreens, such that the passengers in the back of the car can download or streammovies while the driver is using an app to find a particular roadside amenity.Finally, we don’t expect drivers to configure their IVI on the dashboard, so wesee a control app or a web portal being an important part of the multi-screenexperience for configuration and content consumption away from the car.
What are the killer apps from the consumer’s perspective?
If we look to mobile, we couldn’t have predicted thatAngry Birds and Instagram would have risen to dominance. So while we can’taccurately predict what apps vehicle owners will want to use in their cars, itis safe to say that the winners will deliver information and entertainment(also known as â€œinfotainmentâ€) to drivers. However if we lock the systems downto information services (news, weather, flight arrivals, sports, traffic,points of interest, nearby fuel, and more) and entertainment (streaming radiobeing the best example) we may be restricting users from choosing the apps theyreally want, we may restrict the developer ecosystem from creating experiencesthat can change an entire industry. So we believe in the hybrid approach; anopen ecosystem of innovation, but with a tightly managed curated experience inthe car which can evolve over time as needs and trends change.
What are the killer features from a car manufacturer’sperspective?
Car OEMs need to create additional stickiness and brandloyalty, and in-vehicle apps are a great way to do that, whether they are OEMbranded apps so that the manufacturer and its dealers an engage with itscustomers while in the vehicle, or via apps that add value to the car such asdiagnostic, informational and other unique apps commissioned by the OEM. Formanufacturers it’s not so much about the apps, it’s about big data. Cars aregiant sensors, whether it’s internal parameters such as car performance andreliability or external ones such as weather and trip data, and OEMs are in aunique position to harvest that data for intelligence, planning and ultimately,commercial gain.
Unlike mobile, automotive OEMs will insist on a securewalled garden for many reasons including control and protection of the driver,so we will see a need for locked down environments where every app and serviceis thoroughly tested and approved. With that comes the opportunity for revenuegeneration based on having the keys to the walled garden where those keys arethe APIs and access to the consumer and his profile.
What about the after-market? And what about OTT?
Ultimately will the car manufacturer’s in-built systemsbe the ones consumers use, or will they be discarded in favor of after-marketsolutions that offer a wider choice of apps, content, flexibility and commercialmodels. Those after-market devices (a great example being GPS devices) arebeing purchased in the millions. Android as an operating system has thepotential to be the platform of choice in vehicles but will it be anafter-market add-on? Or will the driver’s smartphone be the device of choice?As we have seen in the TV market, there is a strong desire from consumers to goâ€œOTTâ€ (Over The Top), by buying their own terminals and then paying for contentand services. This is the biggest risk to the car manufacturers, and if theyembrace the above 9 points in the right way, they have every chance of being incontrol of the in-vehicle experience for the entire lifetime of the vehicle.
AppCarousel is a leading app store provider that providescustom app store solutions and app ecosystem management for major organizationsacross a variety of sectors including consumer electronics, automotives,telecommunications and IoT (Internet of Things). AppCarousel takes thecomplexity away from app distribution and app ecosystem management by poweringthe curation, management, distribution and monetization of apps. AppCarouselhelps to drive app discovery, adoption and revenues by putting organizations incontrol of their app strategies and allowing them to capitalize on the growingapp economy, while delivering an enhanced customer experience across multiplescreens and connected devices. AppCarousel, based in San Francisco, is part ofWmode Inc. For more information, visit http://www.appcarousel.com.
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