Francesca Forestieri, director, mAutomotive for the Connected Living Programme of the GSMA, talks to Susan Kuchinskas about the best ways for operators and the car industry to connect
What role does the GSMA play in the automotive sector?
The GSMA, founded in 1987 by 15 operators, now comprises close to 800 of the world's mobile operators, plus more than 230 companies in the mobile ecosystem from 219 countries. The GSMA is focused on innovating, incubating and creating new opportunities for its membership, all with the end goal of driving the growth of the mobile communications industry.
One of GSMA’s five priority projects, the Connected Living Programme, seeks to foster the deployment of everything connected intelligently. Research from the GSMA and Machina Research estimates there will be 25 billion total connected devices by 2020, of which 12 billion will be mobile connected. One area of innovation, of course, is the automotive sector. The revenue opportunity is estimated at about $202 billion for automotive connected devices. These revenues are due to development of value-added services as well as pure connectivity.
Within the context of this program, the GSMA launched the Connected Car Forumin 2011 to bring together mobile operators and automotive vehicle manufacturers, with the aim to foster telematics service deployment through the development of connectivity enablers, realization of operational improvements, and launching of strategic opportunities for new services.
What’s the best role for mobile operators when it comes to connected car services?
Mobile operators have a series of assets, going beyond connectivity and subscription management, which are important elements for the connected vehicle service realization, including large-scale data collection, complex data processing/data mining, service enablement and service delivery platforms. A key operator capability, which is of increasing importance for the evolution of business models supporting connected vehicle services, is billing and charging. (For more on billing and charging, see Revenue sharing and the telematics value chain, Telematics and the connected car: How to deal with increasing data use and Telematics and the search for a universal data plan.)
These capabilities help to position operators for playing value-added roles for specific connected vehicle services, including infotainment (on-demand radio, video), augmented reality points of interest, apps, remote control of the vehicle environment, stolen vehicle tracking and fleet management. (For more on on-demand radio, see Telematics and the rise of in-car Internet radio, part I and Telematics and the rise of in-car Internet radio, part II.)
There are other entities, including automakers themselves, looking at providing these services. Will there be competition among them?
The whole industry context is changing dramatically as the emphasis on wide-scale deployment of services is increasing. The scale of this growth is generally recognized by all and includes completely new service deployment. Consequently, these changes are impacting the value chain for delivering services. (For more on the service delivery value chain, see How apps are changing the telematics value chain.)
Competition across a wide range of actors (including new entries) will naturally exist for specific connected vehicle services and markets. Nonetheless, the overall growth in the sector as a whole is expected to attenuate the direct competition, as the overall market expands and evolves. It's a monumental moment in time for everyone involved in connected vehicle service deployment. During this period of change, increased cooperation will be important across all the key players (automakers, operators, 1st tier suppliers and telematics service providers) if we are to successfully reach wide-scale service deployment.
What’s the latest on progress for implementing 4G/LTE?
LTE is being deployed on a country-by-country basis depending on when spectrum is released by governments. Certainly the U.S. and parts of Asia Pacific and Europe are deploying LTE networks now, with other countries around the world expected to follow once much-needed spectrum is made available. Operator-specific commercial solutions will be developed that reflect both demand for high-bandwidth services as well as licensing and spectrum availability.
We think high-bandwidth services will be an important resource to support next-generation connected-car services. We are moving toward more complex infotainment, navigation and cloud-based services, which benefit from high-bandwidth deployments.
What are the challenges facing mobile operators as they work to support, provide and encourage the development of telematics services?
Historically, operators and automakers have not had direct, seamless relationships. Most importantly, the two industries are characterized by very different market forces, geographical footprints, and industry characteristics, such as product planning. This context is further complicated by the necessity for operators to provide automakers with interoperable regional (and global) connectivity solutions as well as support ‘for new automotive’ connectivity-related issues, such as security and privacy. This situation is further exacerbated by the requirement of new technologies, business models and cooperation for the wide-scale deployment envisaged.
For these reasons, GSMA has begun to lay the foundations for cooperation on connectivity requirements, obstacles, operational improvements and enablers for wide-scale solutions. This cooperation occurs primarily through the GSMA Connected Car Forum, as a platform for automakers and operators both on a global and regional level. Our goal is to create ecosystem change for seamless connected services.
Susan Kuchinskas is a regular contributor to TU.
For more on connected cars, see Special report: Telematics and apps.
For all the latest telematics trends, check out Telematics Brazil & LATAM 2012 on Sept. 12-13 in Sao Paulo, Telematics Japan 2012 on October 9-11 in Tokyo, Telematics Munich 2012 on October 29-30, Telematics for Fleet Management USA 2012 in November in Atlanta and Content and Apps for Automotive USA 2012 on Dec. 4-5 in San Diego.
For exclusive telematics business analysis and insight, check out TU’s reports: In-Vehicle Smartphone Integration Report, Human Machine Interface Technologies and Smart Vehicle Technology: The Future of Insurance Telematics.
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