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November 6, 2017 Strategy Analytics, Inc 1
Automotive Infotainment & TelematicsAND - Capital Markets Day 2017
RICHARD ROBINSON
November 6, 2017 Source: Infotainment & Telematics Service 2
• Director – Global Automotive Practice• Previous: Alpine as HMI lead on Navigation and Infotainment Design
AUTOMOTIVE PRACTICE – SINCE 1988
November 6, 2017 Strategy Analytics, Inc 3
LEADING-NAME CLIENTS ACROSS THE VALUE-CHAIN
70% of Tier 1 Suppliers
90% of Major Auto Semiconductor
Suppliers
70% of top OEMs
FIVE SERVICES TO COVER ALL AUTOMOTIVE OPPORTUNITIES
INFOTAINMENT & TELEMATICS
AGENDA
Next Generation Connected Vehicle Architecture
• Gen. 1.0 Market Status
• Gen. 2.0 Market Drivers
• Domain Convergence - Data Collection/Management
• Gen. 2.0 Data Management Opportunities
• Indirect – Direct - Cloud based - AI & Digital Assistants
• Navigation:
• Autonomous vehicle
• Hybrid
November 6, 2017 Source: Infotainment & Telematics Service 4
MARKET STATUS
•Telematics 1.0 business model• Trying to monetize the consumer directly• Too many de-activated subscriptions• “Free periods” too short
November 6, 2017 Source: Infotainment & Telematics Service 5
6 months FREE!
Only $10 per month!
Market FAILURE+ =
MARKET STATUS
IN-ACTIVE SUBSCRIPTIONS (CUMULATIVE)
November 6, 2017 Source: Infotainment & Telematics Service 6
Source: Strategy Analytics Infotainment & Telematics Service
MARKET STATUS
INACTIVE SUBS = DEAD $$$
November 6, 2017 Source: Infotainment & Telematics Service 77
Source: Strategy Analytics Infotainment & Telematics Service
Over $19 Billion wasted 2011 2017
TELEMATICS IS A VALUE ADD
MORE OEM’S OFFERING EXTENDED FREE TRIAL
November 6, 2017 Source: Infotainment & Telematics Service 8
To Proprietary
Proprietary
Proprietary,
SiriusXM
4G LTE
4G LTE
2.5G/3G/4G
2.5G
4G LTE
4G LTE
2.5G
3G
2.5G
* GM’s OnStar Basic plan, and Mercedes’ mbrace Connect plan are free for 5 years with 2016+ GM vehicles and 2016+ Mercedes vehicles.
OEM
Typical Players in U.S. OEM MarketCarrier
6 Months
4 Years
6 - 12 Months
5 Years
5 Years*
1 Year
1 Year
5 Years*
1 YearEmbedded telematics is evolving to longer free trial period.
Free TrialNetwork
SpeedTSP
B2C
B2C
B2C
B2C
B2C
AUTOMOTIVE EMBEDDED MODEMS – MARKET STATUS
2017 OEM SHIPMENT ATTACH RATE - EU
November 6, 2017 Source: Infotainment & Telematics Service 9
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
France Germany Italy Spain UK
Telematics Status EU - 2017
Embedded Connectivity No Embedded Connectivity
• Italy: Only 27% of vehicles will ship with embedded connectivity in 2017
• France, UK and Germany: Have the highest adoption with 40% to 42% in 2017
• Spain: 32% of vehicles shipped in 2017
AUTOMOTIVE EMBEDDED MODEMS
GLOBAL ANNUAL SHIPMENTS
November 6, 2017 Source: Infotainment & Telematics Service 10
0
20.000
40.000
60.000
80.000
100.000
120.000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Un
it S
hip
me
nts
(0
00
's)
North America Europe South Korea Japan China India Russia Brazil Rest of World Non Connected Cars
51% of vehicles shipped will have embedded
modems
Telematics 1.0
Telematics 2.0
INFOTAINMENT & TELEMATICS
AGENDA
Next Generation Connected Vehicle Architecture
• Gen. 1.0 Market Status
• Gen. 2.0 Market Drivers
• Domain Convergence - Data Collection/Management
• Gen. 2.0 Data Management Opportunities
• Indirect – Direct - Cloud based - AI & Digital Assistants
• Navigation:
• Autonomous vehicle
• Hybrid
November 6, 2017 Source: Infotainment & Telematics Service 11
MARKET DRIVERS
GEN 2.0 TELEMATICS ARCHITECTURE
November 6, 2017 Source: Infotainment & Telematics Service 12
Cloud
IoT
OTA
OEMs
Telematics ECU
Cloud
Smart Antenna
Headunit/
Cockpit Domain Controller
Telematics ECUCockpit
Domain Controller
Smart Antenna
Body
Chassis
ADASEthernet
Powertrain
ADASECU
PowertrainECU
Body ECU
Chassis ECU
Gen 2.0
November 6, 2017 Source: Infotainment & Telematics Service 13
GEN. 2.0 MARKET DRIVERS
DATA COLLECTION AND MANAGEMENT
Driver data – Personal account information, personal contacts, payment information, driving behavior data, biometric data, personal preferences data (e.g. HVAC settings, seat position, audio source preferences, etc.), app/feature usage data, microphone data, in-cabin camera data, in-cabin sensor data (e.g. seat sensors)
Vehicle data – inspection/regulatory data, collision/forensic (e.g. EDR) data, diagnostic/trouble code data (e.g. OBDII/ EOBD data), proprietary OEM data, sensor data, parts performance data, emissions data, vehicle security data (e.g. firmware/software security information)
Content data – media (music, video), POI data, other types of data provided and/or owned by third parties
V2X data – Wireless network condition information, connected device information (e.g. smartphones, docked tablets) V2V data, IoT data (e.g. connections to smart home devices or EV charging stations), Location/GNSS data, other satellite connectivity data, infrastructure data (e.g. toll ECU data)
Environmental data – Physical road conditions (e.g. ice, potholes), weather, traffic, road hazards/furniture, outside temperature, available parking spaces
November 6, 2017 Source: Infotainment & Telematics Service 14
Sample Use CasesUX Enhancement
- Analyze UI usage
- Analyze in-vehicle app usage
- Learn driver/passenger preferences
- Enhance services (e.g. concierge service) based on analysis of usage data
- Analyze driving style to improve autonomous driving systems’ performance
- Monitor wireless network conditions to troubleshoot connectivity issues
Process Improvement
- Get ahead of recalls/warranty exposure
- Make changes on the production line
- Streamline OEM parts inventories and deliveries
- Collection of high-resolution location data to enable autonomous driving
- Ensure compliance with changing global regulatory environment
- Testing/simulation (potentially in near real-time when 5G networks become available)
Monetization
- Direct sale of data to third-parties (e.g. retailers, insurers, government entities, media companies, telecom operators, etc.)
- Targeted marketing efforts (e.g. dealer CRM, eventually advertising)
- Provide fleet-related data to third parties (e.g. vehicle load /weight conditions, location, fuel usage, driver/passenger identification, etc.) for direct or indirect monetization
GEN. 2.0 MARKET DRIVERS
DATA COLLECTION AND MANAGEMENT
November 6, 2017 Source: Infotainment & Telematics Service 15
Number of Automotive Software-Related Recalls in U.S., 2011 – 2016
Source: CX3 Marketing
GEN. 2.0 MARKET DRIVERS
SOFTWARE RECALLS
• Typical (Non-OTA) software updates cost between $300 -$600 per vehicle.
• ~ $3 Billion spent by OEMs to do (non-OTA) software updates in the US alone in 2016!
OTA OEM IMPLEMENTATION STATUS
November 6, 2017 Source: Infotainment & Telematics Service 16
OEM Telematics Control Unit
Infotainment System
Powertrain/ Safety
All ECUs
2020
2020
2020+
2020+
2020
TBDTBD
2020+
TBD TBD
TBD
TBD
TBD
TBD
TBD
TBD TBD 2020+
TBD TBD TBD
TBD TBD
TBD
TBD
TBD TBD
TBD
Wi-Fi
2017
TBD TBD
GEN. 2.0 MARKET DRIVERS
OVER THE UPDATE BUSINESS MODELS
Business Models
Subscription: Subscriptions are generally annual or quarterly (depends on OEM) and pricing is either per vehicle module being updated or per vehicle. This generally applies when providers are selling to OEM customers. All subscription models include separate one-time NRE for integration and either include upkeep/maintenance fees with the subscription price or charge a separate annual fee.
Per Campaign: Some OEMs only want to pay per OTA update campaign, but this is less common as most are realizing they’ll want to send multiple campaigns. Pricing is per vehicle module. This generally applies to OEM customers.
Licensing OTA Components: Some companies license their OTA update solution, or specific OTA update platform components/modules, to customers, allowing them to run the platform or components on either the customer’s or provider’s servers, depending on preference. The license fee is either a one-time fee or an annual fee.
Revenue Share: A future model under consideration by OTA solution providers is to share revenue with OEMs that charge for software/feature upgrades.
November 6, 2017 Strategy Analytics, Inc 17
GEN. 2.0 DATA MANAGEMENT OPPORTUNITIES
November 6, 2017 Strategy Analytics, Inc 18
Vehicle manufacturers (OEM’s) are looking to exploit vehicle data
Requirement: Understand how people drive and monetize their interests
1. Indirect data management: • Data brokerage through 3rd parties• Backend Process/Logistics
2. Direct data management: • Wallet on wheels• Ecommerce platforms in the car• Ecommerce platforms on Smartphones
3. Cloud Services & AI/Digital assistants• Amazon web services etc.• Alexa, Cortana, etc.
INDIRECT DATA MANAGEMENT
OTONOMO
Industry Example: Otonomo’s Car Data Exchange and Marketplace
• Provides a marketplace where OEMs can manage vehicle data collection and sell data to third parties
• Current OEM client is Daimler
• Interest from 7 other automakers
• Delphi InvestmentNovember 6, 2017 Strategy Analytics, Inc 19
DIRECT DATA MANAGEMENT PLATFORM
BMW CAR DATA
BMW launched its CarData platform on May 30, 2017, in Germany:
• Provides customers with access to their vehicle data when requested
• Complies with the EU’s General Data Protection Regulation (GDPR)
• Provides a platform where third-party companies can make use of aggregated vehicle data
• BMW stated 8.5 million BMW Group vehicles on roads can potentially share data with this platform
November 6, 2017 Strategy Analytics, Inc 20
Source: BMW
OEM DATA MANAGEMENT PLATFORM
VEHICLE E-COMMERCE/WALLET ON WHEELS
21
Honda in-vehicle fuel and parking payment demo at CES 2017
Partnered with Visa, fuel pump vendor Gilbarco Veeder Root, and parking services company IPS Group to enable drivers to pay for
fuel and parking
General Motors OnStar Go e-payment integration
OEM partnered with Masterpass to enable payments to merchants offering products and
services through OnStar Go
FROM CALL CENTERS TO AI/CLOUD
November 6, 2017 Source: Infotainment & Telematics Service 22
Call Center
Wi-Fi
A.I.
IoT
OEMS’ INFOTAINMENT AI PARTNERSHIPS
November 6, 2017 Source: Infotainment & Telematics Service 23
OEM Digital Assistant Status
BMW/MINI Amazon Alexa, Microsoft’s CortanaAlexa – Launched (BMW Connected App for Alexa), Alexa in all BMW/MINI models by mid-2018, Cortana – Demonstrated
Ford Amazon Alexa Planned launch in Ford electrified models
GM IBM Watson, used with OnStar Go backend Launch was planned for early 2017
HondaHANA, proprietary assistant developed in partnership with SoftBank
Concept demonstration
Hyundai Google Assistant, Amazon AlexaGoogle Assistant – Launched in Genesis, Alexa – Launched in 2017-MY vehicles and select 2016-MY vehicles
Mercedes Google Assistant, Amazon Alexa Both planned for launch sometime 2017
Nissan Microsoft’s Cortana, Amazon Alexa Cortana – planned launch; Alexa - launched (2017, 2018-MY)
ToyotaLine’s Clova, YUI, proprietary digital assistant technology
2018 for Clova, YUI concept demonstration
Volkswagen Amazon Alexa Planned, launch date not yet announced
INFOTAINMENT & TELEMATICS
AGENDA
Next Generation Connected Vehicle Architecture
• Gen. 1.0 Market Status
• Gen. 2.0 Market Drivers
• Domain Convergence - Data Collection/Management
• Gen. 2.0 Data Management Opportunities
• Indirect – Direct - Cloud based - AI & Digital Assistants
• Navigation:
• Autonomous vehicle
• Hybrid
November 6, 2017 Source: Infotainment & Telematics Service 24
AUTONOMOUS IS A SOFTWARE PROBLEM
September 2017 Copyright© Strategy Analytics 2017 25
Many cars with hardware:
Few cars SAE L4 or above
Source: Strategy Analytics Autonomous Vehicles Service
NAVIGATION ISSUES
FOR FULLY AUTOMATED DRIVING
• Accuracy & Update Frequency• Fail Safe At present, if the map has an error then the human driver is
able to make a decision as to the best way to proceed. This normally works – but even with human processing skills we still see events where a vehicle as taken an inappropriate or incorrect route
• Fail Safe?? Minute-by-minute updates will be required to account for unexpected road closures etc.
• Destination Entry• Currently: Navigation systems are excellent for getting within a few
tens of metres of our destination. • Future: For fully automated driving we will need to potentially specify
a much more accurate destination, and have a co-ordinated hand-over to a parking mode if the vehicle is to wait for us
TomTom Level 3 Proposal: Have a traditional route option and an ‘autonomous’ route option (with limited/no driver interaction)
• Traffic conditions, simpler, longer?
September 2017 Copyright© Strategy Analytics 2017 26
Source: ranker.com
ROLE OF MAP / NAVIGATION IN LOCATING
SELF-DRIVING VEHICLES IS STILL UNCLEAR
• It is generally agreed that any self-driving vehicle needs to be able to locate itself with an accuracy of around 10 cm
• A blend of technologies will be required:
• HD Maps / On-board sensors?
• Satellite positioning?
• Dead-reckoning?
• No agreement on exactly how to blend
• Maps: what’s the balance between survey vehicle and user-generated content?
• Sensors: Do we use all of RADAR, LiDAR (current), Camera etc.? Or just a subset?
• Satellite positioning: Is current consumer-grade sufficient?
• IMU (Inertial Measurement Units): Are today’s MEMs-based units good enough?
June 2017 Copyright© Strategy Analytics 2017 27
Source: TomTom
HIGH-PRECISION…ALL THE TIME
Integrated inputs from:
• Highly Automated Driving/ADAS Domain
• Navigation UI
• HD Map
• Real time (Environmental)
• Lane fusion
• Sensor data• Camera/Lidar/Radar
August 2017 Copyright© Strategy Analytics 2017 28
HIGH-PRECISION LOCATION DEMAND
• High-precision location assumed to be required for all L3 and greater applications, and on increasing number of L2
• Cadillac CT6 uses LiDAR-based map data (Trimble GPS, Geodigital maps)
August 2017 Copyright© Strategy Analytics 2017 29
HYBRID NAVIGATION
Varying approaches:
1. Map data is embedded & Data services are cloud-based • Traffic, parking, fuel station, etc.
• Many OEMs using this approach.
2. On-demand/dynamic downloading of map data • Incremental and regional map data via over-the-air update platform
• AND – Map fusion
• Elektrobit, TomTom, etc. use NDS.
3. Offload all map data and data layers/services to the cloud • Mapbox’s original approach
• Tesla’s approach using Google Maps
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HYBRID NAVIGATION
Types of Data to Offload to Cloud: 1. Non-essential data with larger storage requirements:
• 3D buildings
• Satellite imagery
2. Dynamic data/services:• Real-time lane-level information – closures & road hazards
• POI data affected by time of day (e.g. business hours, open hours)
• Fueling/charging station availability and pricing
• Traffic incident and flow information - Decode on server not IVI unit
• Parking data - availability of on-street & garage parking
• Weather service and road weather data - upcoming road segments
• Toll road information
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HYBRID NAVIGATION
Cloud Services Considerations:
1. Maintenance “downtime” not allowed• System must be available at all times
2. Fault tolerant delivery of map updates & data services• Mechanism must be in place for rolling updates
3. System must scale• New processing nodes must be made automatically
• Need access to data centers in all service regions
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HYBRID NAVIGATION
Automaker views:
1. Many OEMs still have legacy, physical-media-based map update business segments • Ford, Hyundai, VW, etc.
2. Toyota has moved to cloud-based maps for Entune 3.0 • Dynamic Navigation, via the Toyota Smart Center
3. File size and processor issues• Large file sizes are a challenge
• Less-capable infotainment processors still make embedded map updates slow
• Legacy vehicle architectures (using CAN) are not suitable for high-data-volume (OTA) updates
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HYBRID NAVIGATION: MARKET REQUIREMENTS
1. Personalization of destinations and routes• System should learn drivers’ routes and destinations over time• Should learn preferred POIs• Should be able to support dynamic re-routing based on calendar appointments
2. Long-term predictive traffic for departures, routing, and ETAs• HERE claims it can predict traffic conditions up to 12 hours in advance
3. Enhanced navigation should offer lane-level guidance• Show correct lane vehicle must be in to take a given highway exit• Show correct lane to avoid road hazards
4. Use of sensor data• Real-time sensor data would be available on-board/embedded• Sensor data can also be crowdsourced and processed in the cloud for
delivery to vehicles on network (e.g. camera data, such as with Mobileye’s REM platform)
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