Jerri-Lynn Scofield explores how developers, TSPs, and OEMs can work together to personalize content delivery and strengthen competitiveness
The day will soon be here when a driver will jump into her car, and the vehicle will discover her smart device—whether it’s a tablet, a smartphone, or a wristwatch. The device will be checked against the auto’s cloud platform and will automatically adjust—the user likes her screen to be in color, for example, or she’s a BBC listener. “The car knows who you are because the phone number configures it in a way that is personal and meaningful to you,” says Leo McCloskey, vice president marketing for Airbiquity. “Its services will adapt to what you’re doing at the moment.” (For more on cloud computing, see ‘Telematics and cloud computing: Hey you, get onto my cloud!’.)
Thus far, the smartphone has been the dominant model for configuring connected cars. “The phone has become the device by which each individual constructs their digital connected lifestyle,” as McCloskey puts it. To incorporate smartphones, and all the individualized content people bring into a car in a safe manner, McCloskey identifies three necessary conditions: Any system needs to be hands-free, must allow smart device access through the vehicle resources, and must adapt for the safe consumption of content when moving across jurisdictional lines. (For more on connected lifestyles, see ‘Telematics and the socially networked car’ and ‘Telematics and the socially networked car, Part II’.)
Distribution is key
Although the smartphone may be the dominant model now, it’s not the only way of viewing the issue. From the perspective of content providers, such as ESPN, “The opportunity is content distribution,” according to Patrick Polking, senior director, business strategy and development, ESPN Audio. ESPN’s focus is on a distribution model, as opposed to an app model. (For more on smartphones, see ‘Six reasons the smartphone is key to auto telematics’.)
In this model, the OEM plays a role analogous to a cable company, allowing content to be delivered to the OEM’s consumer. Personalized content is delivered, on demand, but on a non-exclusive basis. “We do not license content on an a la carte basis and do not withhold from customers,” says Polking. “We distribute in the broadest sense possible to serve all our fans.”
The central challenge of how to manage connectivity with the vehicle is being addressed in a similar way by all automakers. Many use Airbiquity’s network-based service delivery platform—a cloud platform to manage connectivity with the vehicle. The use of this platform is largely dictated by cost considerations and the mismatch between the product cycles of consumer electronics and automobiles, a consideration that must factor both into revenue calculations and product design.
For consumer electronics, the life cycle is two to three years; for autos, it’s about eight years. “The different lengths of the auto product cycle dictate a different set of requirements of how developers think about what works in the market,” says McCloskey. (For more on development times, see ‘M2M telematics: Turning the OEM development model on its head’ and ‘Why telematics firms need to work with wireless developers’)
The need to scale
The automotive industry started going down the path, led by Ford, of using APIs that apply to each particular vehicle. “If the developers have to do something unique for every automaker or every vehicle, the math just doesn’t work,” McCloskey argues. “It just doesn’t scale in a way that ever becomes cost-effective for developers.”
Airbiquity’s alternative is a platform governed by a set of rules, with each developer writing to that single platform. The system is somewhat analogous to the consumer electronics space, where the device learns how to work for the individual rather than the individual learning how to work the device. “We expose the vehicle resources to the developers in a way that doesn’t expose them to additional work,” says McCloskey, but in a way governed by the OEM, since “the OEM has the liability concern here.”
The policy is a rules-based framework that can be updated, daily, weekly, or monthly, according to McCloskey, with vehicle systems governing content behavior. There’s no stranded investment by any party and, as the market for content evolves, “the policies that the vehicle receives over its lifecycle guarantee content that is contemporary with the consumer market.” There’s only marginal additional work for the developer, and from the OEM’s perspective, “policies control the application in a way that keeps my focus on the road,” says McCloskey.
Who pays for R&D?
The pattern for financing R&D costs “is a mixed bag,” says Partha Goswami, technology manager, connected vehicle and infotainment, General Motors. First, some of the telematics and infotainment competencies are coming from outside the automotive industry. For these areas, the innovation and the R&D investments—directly or indirectly—may be coming from the consumer electronics industry, software providers, telcos, or the semiconductor companies. Traditional tier 1s and TSPs are also ramping up their in-house work to make inroads in this domain.
Second, individual OEMs may internally finance the advanced R&D work required for integrating a specific technology or for developing the automotive grade of an existing technology. And finally, explains Goswami, there are cost-sharing models that include consortiums and partnerships formed to create specific joint products or to establish common standards and protocols.
Further, it’s not just TSPs and OEMs who finance R&D. Content providers are involved in “what is very much a cooperative process,” says Polking, with “certain R&D costs shared between the OEM and us, depending on the set up. That said, at the end of the day, it’s audio content distribution, which is not that complicated and which shouldn't require much R&D. For the most part, the heavy lifting has been done on the OEM and/or TSP side.”
“Whether R&D is done directly at the OEM level or through a TSP depends on how the OEM is set up,” says Polking. Some do everything in-house, while others operate differently, using a package provided by a TSP. “Although R&D is done at TSP level, the OEM ends up paying for that,” he notes.
Jerri-Lynn Scofield is a regular contributor to TU.
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