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Strategy Analytics, Inc 1
Automotive Infotainment & Telematics
March 24, 2017
RICHARD ROBINSON
March 24, 2017 Source: Infotainment & Telematics Service 2
• Director – Global Automotive Practice• Previous: Alpine as HMI lead on Navigation and Infotainment Design
AUTOMOTIVE VALUE CHAIN:
HARDWARE/SOFTWARE COMPANY EXAMPLES
March 24, 2017 Source: Infotainment & Telematics Service 3
Networks,Elect. Systems,ECU Modules,Sensor Modules, etc.
Elect. Systems,ECU Modules,Sensor Modules
Vehicle OEMs
Tier 1 Suppliers
Tier 2 & 3 Suppliers
Software Suppliers
Semiconductor Suppliers
Electronic Sub-Systems,ECU modules,Sensor Modules
MCUs,Memories, ASICs,Sensors,
Application software, Operating System, Drivers etc.
Operating Systems, Drivers, Tools, etc.
Application software, Operating System, Driver Software
Driver SoftwareSoftware
Hardware
Company
Examples
Value-Chain
Player
System integration,Application software, Operating system, Drivers etc.
March 24, 2017 Source: Infotainment & Telematics Service 4
20 YEAR ANNIVERSARY OF ONSTAR
• Automatic Crash Notification
• Good Samaritan
• Turn-by-Turn Navigation
• Hands-Free Phone
• Live Assistance
• Contextual Awareness
• Waze
• HERE, TomTom, Garmin, Googlemaps
• Bluetooth
• Nuance/Servers
1996 2016
March 24, 2017 Source: Infotainment & Telematics Service 5
1996 2016 WHAT CHANGED?
• On-board and off-board systems gathering and interpreting data to determine:
• Hardware and software integrity of the car• Mood, physical health, attention of the
driver• Identification of driver and passengers• State of the roadway (around & ahead of
the car)• State of surrounding vehicles• Weather and traffic• User interfaces – driver needs – voice,
eye/facial tracking, gestures
Externally: Smartphones!
Internally: A shift from Reaction Anticipation/Prediction
March 24, 2017 Source: Infotainment & Telematics Service 6
INFOTAINMENT & TELEMATICS DESIGN TRENDS
PAST & FUTURE…
2nd Generation 1998 2006
Display
CD Changer
Head unit
Navigation
Phone ECU Sat Radio
Amplifier
Distributed BUS Architecture e.g. MOST
$$$$
Display
Device Connectivity ECU
Head unit
Telematics ECU
OR
Native and Phone based apps – Hybrid solution
Cloud
4th Generation 2010
3G 4G
$$
Device Connectivity ECU
Telematics ECUOR
3rd Generation 2005 2010
Head unit
& Display
Navigation
Amplifier
Headunit Integration
$$$
March 24, 2017 Source: Infotainment & Telematics Service 7
4TH
GENERATION IVI ARCHITECTURES BY OEM
EMBEDDED TELEMATICS
Wireless LANBluetooth
USB
4th Gen
GM: OnStar
Audi: Connect
BAIC: NovaLink
BMW: Connected Drive
Chery: Cloudrive
Hyundai: BlueLink (1st gen)
Jaguar Land Rover: InControl Remote/Protect
Headunit and Telematics ECU
Display
Telematics ECU
Head unit
Cloud
3G 4G
Mercedes-Benz: mBrace
Nissan: NissanConnect Services
Peugeot: Connect
Toyota/Lexus: G-Book/Enform
Volkswagen: Car-Net
Volvo: OnCall/Sensus Connect
Headunit with Embedded Telematics
SAIC: Inkanet
Citroen: eTouch
Hyundai: Blue Link 2 (2nd gen)
Fiat-Chrysler: Uconnect Access
Display
Head unit
Cloud
3G 4G
Modem
Wireless LANBluetooth
USB
March 24, 2017 Source: Infotainment & Telematics Service 8
INFOTAINMENT SERVICES:
IP BANDWIDTH SEGMENTATION
Connectivity Suitability:
Embedded Modem
Tethered Smartphone
Stolen vehicle tracking
eCall - Automatic Crash notification
Remote Diagnostics
Remote Door unlock/Heat
Basic Traffic
Video Streaming
Music Streaming
HD Video Download
Weather, Stocks, data, News
Location based services
Internet radio
Eco-Driving
Workflow Management/Fleet
PAYD – Usage Based Insurance
Road tolling
EV Charging and billing
High Definition Traffic
March 24, 2017 Source: Infotainment & Telematics Service 9
TELEMATICS IS A VALUE ADD
MORE OEM’S OFFERING EXTENDED FREE TRIAL
AT&T
AT&T
Sprint
AT&T
AT&T
Verizon
AT&T
Verizon
Verizon
Jasper Wireless, Raco Wireless
WirelessCar To Proprietary
WirelessCar, Airbiquity
Proprietary
Proprietary, Convergys
Hyundai Autoever America
SiriusXM
Verizon Telematics
SiriusXM
4G
4G
2.5G/3G
2.5G
4G
4G
2.5G
3G
2.5G
* GM’s OnStar Basic plan, and Mercedes’ mBrace Connect plan are free for 5 years with 2015+ GM vehicles and 2016+ Mercedes vehicles.
AudiAudi connect
BMWConnectedDrive
Chrysler Uconnect
FordSYNC Connect
GMOnStar
Hyundai Next-Gen Blue Link
InfinitiInfiniti Connection
Mercedes-BenzmBrace Connect
Toyota/LexusSafety Connect
LTE FDD
LTE FDD
EVDO
LTE FDD
LTE FDD
LTE FDD
GPRS
CDMA EVDO
CDMA EVDO
Connectivity Solution
OEM
Typical Players in U.S. OEM Market
Carrier
6 Months
4 Years
6 Months
5 Years
5 Years*
1 Year
1 Year
5 Years*
6 Months
Embedded telematics is evolving to longer free trial period.
Free TrialNetwork
SpeedTSP
B2C
B2C
B2C
B2C
B2C
WHAT WAS WRONG WITH TELEMATICS?
• Trying to monetize the consumer directly
• Too many de-activated modems, “Free periods” too short
February 28, 2017 Strategy Analytics, Inc. 10
6 months FREE!
Only $10 per month!
Market FAILURE+ =
February 28, 2017 Strategy Analytics, Inc. 11
HARDWARE IN MARKET (CUMULATIVE)
OEM EMBEDDED TELEMATICS - GLOBAL
Source: Strategy Analytics Infotainment & Telematics Service
February 28, 2017 Strategy Analytics, Inc. 1212
ACTIVE SUBSCRIPTIONS (CUMULATIVE)
OEM EMBEDDED TELEMATICS - GLOBAL
Source: Strategy Analytics Infotainment & Telematics Service
February 28, 2017 Strategy Analytics, Inc. 13
IN-ACTIVE SUBSCRIPTIONS (CUMULATIVE)
OEM EMBEDDED TELEMATICS - GLOBAL
Source: Strategy Analytics Infotainment & Telematics Service
February 28, 2017 Strategy Analytics, Inc. 1414
INACTIVE SUBS = DEAD $$$
OEM EMBEDDED TCU’S (UNITS/REVENUES)
Source: Strategy Analytics Infotainment & Telematics Service
Over $19 Billion wasted 2011 2017
March 24, 2017 Source: Infotainment & Telematics Service 15
TELEMATICS 2.0: IT’S TIME FOR CHANGE…
1)Identify Growth Opportunities
2) Update the Domain Architecture
3)Rework the Business model
WHAT’S DRIVING THE CONNECTED CAR?
• CRM / VRM
• Big Data
• FOTA / SOTA
• V2V/V2X (DSRC vs. role for 5G / LTE)
• Artificial Intelligence
• IoT
February 28, 2017 Strategy Analytics, Inc. 16
March 24, 2017 Source: Infotainment & Telematics Service 17
SOFTWARE RECALLS
March 24, 2017 Source: Infotainment & Telematics Service 18
NEXT GEN CONNECTED CAR DESIGN
DOMAIN & BUS CONVERGENCE
2018
Telematics ECUTelematics ECU
Headunit
Display
Head Unit
Cloud
Smart Antenna
Smart Antenna
Body
Chassis
SafetyChassis
ECU
Body ECU
Ethernet
Tele
mat
ics
2.0
March 24, 2017 Source: Infotainment & Telematics Service 19
COMPLEX CRITICAL SYSTEMS
NEED RAPID UPDATE CYCLES…
Example is Safety - There is increasing reliance on:
• LIDAR, RADAR
• Cameras
• Contextual awareness with the objective of collision avoidance
…most of these systems have
COMPLEX software…
March 24, 2017 Source: Infotainment & Telematics Service 20
CONNECTED CAR ECOSYSTEM
TELEMATICS 1.0 2.0
Convergence
Convergence
Infotainment
Telematics
Safety
Body
Chassis
Connectivity
Infotainment
Smartphone Connections
Privacy
Security
Liability
Safety
Recalls
Telematics - 2.0
March 24, 2017 Source: Infotainment & Telematics Service 21
AUTOMOTIVE EMBEDDED MODEMS
GLOBAL ANNUAL SHIPMENTS
0
20,000
40,000
60,000
80,000
100,000
120,000
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
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
50% of vehicles shipped will have embedded
modems
Telematics 1.0
Telematics 2.0
March 24, 2017 Source: Infotainment & Telematics Service 2222
OEM EMBEDDED TELEMATICS
ACTIVE VEHICLE SUBSCRIPTIONS BY REGION
0
25,000
50,000
75,000
100,000
125,000
150,000
175,000
200,000
225,000
250,000
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Active
Su
bscri
ption
s (
00
0's
)
North America Europe
South Korea Japan
China India
Russia Brazil
Telematics 1.0
Leading Regions:
➢ North America: Market Driver - Single Market
➢ Europe: Market Driver – eCall
➢ China: Market Driver – Biggest Global Car market
Global Active subscriptions will exceed 250 Million by 2022
March 24, 2017 Source: Infotainment & Telematics Service 23
OEM EMBEDDED TELEMATICS
CELLULAR MODEM SHIPMENTS - GLOBAL
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Un
its (
00
0's
)
2.5G 3G 4G/LTE 5G
Telematics Forecast 2015 vs. 2023 (18.8 Mil. units 78.6 Mil. units)
• 2.5G Network: 7.4 Mil units in 2015 to 0K units from 2020
• 3G Network: 8.4 Mil in 2015 units to 13.7 Mil units in 2023
• 4G/LTE Network: 2.8 Million units in 2015 to 58 Mil units in 2023
• 5G Network: 5.6 Million in 2023
March 24, 2017 Source: Infotainment & Telematics Service 24
SOFTWARE MANAGEMENT
The Auto Industry was built around producing and selling cars
NOT
Delivering secure software and services
March 24, 2017 Source: Infotainment & Telematics Service 25
DIGITIZATION
Space Shuttle:
500,000 lines of code
Mercedes S Class:
100 million lines of code
Boeing 777:
3-4 millions lines of code
March 24, 2017 Source: Infotainment & Telematics Service 26
SOFTWARE MANAGEMENT
SUPPLIER ACQUISITIONS - SUMMARY
Tier 1s are rapidly building software development expertise to remain relevant. More acquisitions will likely
occur as OEMs & Tier suppliers compete and tech
companies (e.g. Google, Apple, Cisco, Oracle, IBM)
make headway in the connected car marketplace.
Half of Visteon’s 4,000 employees are focused on automotive cockpit
software.
Interest increasing in other software companies with automotive software expertise and products:
March 24, 2017 Source: Infotainment & Telematics Service 27
SOFTWARE MANAGEMENT
CURRENT & FUTURE…
1st Generation 2000s
• No OTAs• Limited to IVI• High Friction for
Consumer• OBD II for ECU Flashing
• Entire vehicle can be updated through multiple ECUs
• Vehicle fully part of IoT
3rd Generation 2020 2nd Generation 2010 2019
• Limited OTA for TCU and IVI systems
• USB still mainly used• Wired OBD II & Ethernet for
Powertrain/Safety updates
OBD IIOBD II
March 24, 2017 Source: Infotainment & Telematics Service 28
OTA OEM IMPLEMENTATION
OEMTelematics
Control UnitInfotainment
SystemPowertrain/
Safety All ECUs
2020
2020
2020+
2020+
2020
Late 2016
Late 2016Late 2016
Late 2016
2017
2020+
TBD TBD
TBD
TBD
TBD
TBD
TBD
2017
2017
2018
2017
2020+
TBD TBD TBD
TBD TBD2017
2017 2017
TBD
TBD
TBD TBD
TBD
In 2017?
March 24, 2017 Source: Infotainment & Telematics Service 29
CONCLUSIONS
➢ No subscriptions!
➢ OEMs need to resolve privacy and security issues
➢ Manage real-time, on-board/off-board data acquisition and management challenges
➢ Empower customers and dealers with access to data
➢ Secure and anonymize data appropriately
➢ Find data partners, as necessary
Strategy Analytics, Inc 30
Automotive Infotainment & Telematics
March 24, 2017