Car telematics enters the mainstream

Automotive telematics is typically referred to as an “emerging technology”, a futuristic idea of how cars will one day be able to communicate. But according to Rémí Demerlé, the director of global partnerships for Telenor Connexion, car telematics is finally entering the mainstream.

Finding the right business model

The hold-up for turning telematics into a standard feature in your car is largely due to the automotive industry’s lack of incentive. The business model to justify the expense of an advanced blending of computer and wireless technology, along with the organization of operations required to make it happen, has evaded the industry for a long time. That is…until the European Union got involved.

“Automotive telematics has finally reached the tipping point, thanks largely due to the European Commission’s initiative for eCall pushing for a regulation which is very likely to be adopted by Parliament and then coming into force in all new vehicles to be launched after 2015/2016,” explained Rémí.

What is eCall?

eCall is a European initiative to create a rapid emergency response system that’s activated when motor vehicles are in trouble. Telematics solutions such as what Telenor Connexion has previously done for Volvo (with their OnCall solution), in which the cellular network is used for communication between car and emergency response centre, are the models upon which the idea for eCall is built.

With the arrival of eCall now imminent, auto manufacturers are hopping on board the telematics bandwagon and seeking out the expertise of companies such as Telenor Connexion, whose years of experience are now paying off. Today, approximately 50 percent of Telenor Connexion’s revenues come from the automotive sector.

277 million connected vehicles by 2020

According to industry analyst “Analysys  Mason”, the global market for machine-to-machine (M2M) connections in the automotive industry will grow from 21.6 million in 2010 to 277  million in 2020. Of the projected 277 million, approximately 49 percent is expected to consist of connected cars, while fleet management solutions make up the remainder.

“eCall is just one of the reasons why car telematics is picking up speed. The car industry is also seeing opportunities to reduce costs, such as through remote vehicle diagnostics, and to create new services with potential of new revenues, such as subscriptions for fleet management of cars, insurances based on driving profile or entertainment in the car,” said Rémí. “Now with the rising popularity of electrical vehicles, Telenor Connexion and its expertise in this field are getting noticed.  Because of the huge importance of battery for electrical cars, remote services for monitoring battery level and usage over lifetime makes the use of connectivity indispensable.  As we see it, telematics and electric cars go hand-in-hand.”

Nissan Leaf sparks new era of electric cars

The launch of the fully electric Nissan Leaf sparked a new era of electric cars. Telenor Connexion was selected by Nissan to provide the connectivity for the Leaf in Europe and Singapore.

“We were able to offer Nissan a customized solution that fit their needs,” said Rémí. “They were interested in a deactivated SIM solution, allowing for customer to control the activation on Nissan’s web site ensuring the respect of privacy. Once activated, the customer can reap the benefits of telematics services having the best experience of driving an electrical car.”

Following their success with Nissan Leaf, Telenor Connexion was approached by Renault, who was looking for a robust SIM solution for both their electric and fuel cars. Renault wanted to avoid the plastic SIM card solution typically found in mobile devices.

“We started the process with Renault back in 2009, and worked with their M2M module supplier Sierra Wireless to develop a solution in which the SIM is embedded into the M2M module and then secured, so that it can live longer and withstand more duress in the car,” said Rémí.

Understanding economy of scale

Telenor Connexion understands that car manufacturers are not interested in multiple solutions for their line of cars. They want a one-size-fits all solution that is flexible, durable and helps them cut costs while simultaneously enhancing their customer relationship.

“The SIMs are the same, whether it’s for a fuel vehicle or for an electrical vehicle. When the SIM gets embedded into the M2M modem, nobody knows what type of vehicle it will be used in, whether it’s professional fleet management or a personal electrical vehicle. Then a few months later a customer buys the car with this SIM in it, registers for services and the car company starts to provide a telematics service adapted to that car owner’s needs,” said Rémí.

A leader in connecting electric cars

Telenor Connexion is a leader in the automotive telematics industry, simply in terms of years of experience. Through its partnerships with Nissan and Renault, Telenor Connexion can also claim its leadership in providing solutions for electrical vehicles.

“Telematics was previously something that was offered in the premium car segment, a luxury that was not an easily justifiable expense for the manufacturer. But today, with eCall coming, things are different and telematics is becoming an integral part of all new cars,” said Rémí.