Connected cars and their impact

Updated: Jul 7 2014, 15:58pm hrs
There is a paradigm shift in the automotive industry today, from predominantly a mechanical driven to software driven vehicles. It is estimated by the Boston Consulting Group that by 2015, more than 60% of the new cars will be connected to the cloud, to users devices, to infrastructure, and to other cars! A typical premium-class car has more than 100 microprocessors and operates on more than 100 million lines of code. Cost of electronic parts as a percentage of total vehicle cost is expected to rise to about 40% by 2015 compared to 20% a decade earlier. With this connected car paradigm, new industries are shaping up giving stiff competition to existing strongholds; customers expectation drastically differs from yester years and newer business and monetisation models are evolving. We look a peek at what is to come in this area.

While in-car infotainment has been one of the early drivers, vehicular connectivity has expanded to include passenger and car safety, economising energy consumption, containment of environmental pollution, and most of all providing an awesome experience for users. The car manufacturers have been working along these lines. The Advanced Driver Assistance System (ADAS) is being implemented by car makers such as Volvo, Mitsubishi, Ford and Volkswagen that includes adaptive headlights, night vision, blind spot detection, roadside recognition, pedestrian detection, collision warning, intelligent speed assist and driver monitoring systems. The engine and transmission control units in todays cars provide real-time measurement of hundreds of parameters related to the performance of engine, transmission and other sub systems. However, going further, these myriad of information will be analysed in

detail and used for various purposes.

An interesting use case is in the insurance industry. When an accident occurs, the values of various parameters such as drivers conditions and driving habits; the surrounding environment including presence of conditions such as heavy mist, rain or traffic; the health of the car including that of brakes, and transmission systems are instantly analysed along with the drivers personal profiles to calculate the maximum permissible claim amount. Historic information of such incidents are used to arrive at the premium amount, all fully data driven.

Recently we have seen a large number of vehicle recalls by car manufacturers to fix manufacturing defects that could potentially create safety hazards. Just in the week of June 16 alone, there were eight recalls in the US of more than 100,000 cars from manufacturers such as GM, Chevrolet, Mazda, and Lexus related to safety issue as reported by National Highway Traffic Safety Administration. With software becoming an integral part of car electronics, and wireless broadband connectivity such as LTE pre-integrated into the cars, the original equipment manufacturer (OEMs) can proactively analyse critical vehicle parameters every milli-second and provide timely inputs on pro-active maintenance either by directing the user to go to the nearest service center or even pushing software fixes over the air. This is expected to benefit the users as well as the manufacturer in terms of increasing car safety and minimising the cost of vehicle re-calls.

Though most of the major car manufacturers such as Benz, Nissan, Volvo and Hyundai have their software development centres in India, third party outsourcing in this sector is expected to pick up due to the above trends. Experiments with Tesla, the electric car promoted by Elon Musk illustrates that the car OEMs need to shift their focus from power and efficiency towards embedded electronics and software in the years to come. However, the moot question is whether the OEMs will retain control over their electronics and embedded systems to differentiate their auto offerings compared to how they did it with engines and transmission systems. Or will they collaborate and create a federated system of components that are standardised in some form for third parties to adapt and improvise.

Two interesting cases are worth looking at. First, Googles driverless autonomous cars is driven entirely by software. With features such as Traffic Jam Assist, the electric car can navigate traffic jams and accident spots intelligently. Fitted with sensors that can see 600 feet in all directions, Googles autonomous cars are just the beginning of software controlled cars. However, Google has clearly indicated that it is not into car manufacturing. However, it will need the ecosystem of car manufacturers, auto components manufacturers and embedded system makers to turn its dream in to reality.

Second, is the recent announcement by Musk to create an open-source based model for the development of key components and the associated infrastructure for electric cars. The model if adopted will standardise the components of electric car and hence will drive price points to affordable limits.

However, Musk and Sergey Brin need to convince the law makers on the possibility of software taking over human controls and also standardise ecosystem components such as road-side infrastructure to maximise benefits. This battle between software car makers and the traditional auto manufactures is akin to the fight between over the top (OTT) players such as WhatsApp and telcos. While telcos, thanks to their facilities, influence and shape of much of the telecom services, the OTTs, leveraged their non-facility based software platform based offerings such as messengers, voice and video chat to a great extent to make dents in the wallet of telcos. Can we expect the same in the car industry

Dorairaj Vembu is senior manager, Sasken Communication Technologies; V Sridhar is professor, International Institute of Information Technology, Bangalore