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Opportunities and new Business Models: Software-Updates Over-The-Air
Hideo YamashitaTelematics Taiwan 20165. October 2016
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Moving toward open mobility.
German automotive-focused software company specializing in open source and
open standards based software solutions for the mobility industry.
Highly specialised on server side technologies, but delivered also embedded
software projects with in-house resources and external partners.
Developed OTA Plus, the only open source client/server solution for over-the-air
software updates for OEMs and Tier1s.
First cloud-only service provider to be accepted into the German Association of the
Automotive Industry (VDA), and leads the OTA activities inside GENIVI and
Automotive Grade Linux.
Headquartered in Berlin, ATS operates a regional hub in Tokyo.
1985
Source: Wikimedia© 2016 ATS Advanced Telematic Systems GmbH
2015
Source: www.teslamotors.com© 2016 ATS Advanced Telematic Systems GmbH
Google Self-Driving Car Project
© 2016 ATS Advanced Telematic Systems GmbH Source: www.google.com/selfdrivingcar/
Gogoro Electric Scooter
Source: www.gogoro.com© 2016 ATS Advanced Telematic Systems GmbH
© 2016 ATS Advanced Telematic Systems GmbH Source: www.starship.xyz
Freightliner Inspiration Truck
Source: Daimler© 2016 ATS Advanced Telematic Systems GmbH
The Rise of New Mobility
Source: Based on Morgan Stanley Research 2015
OWNED AUTONOMY
• High tech, individually operated
• Tesla, Mobileye
SHARED ECONOMY
• Low tech, shared asset•Uber, Lyft, Sidecar, etc.
SHARED AUTONOMY
• “Robo Taxi”• Google, Apple, Uber 2.0
Owned Shared
Human Driver
Autonomous
TODAY
• 100 yr. old model •OEMs, Suppliers, Rentals
© 2016 ATS Advanced Telematic Systems GmbH
ALLnew cars sold with
internet connectivity by 2025
© 2016 ATS Advanced Telematic Systems GmbH Source: IHS, SBD, GSMA, Accenture calculation
Driven by urbanization and macroeconomics, global vehicle sales will continue to grow, although at a slower pace
Current and future annual vehicle sales, millions HIGH DISRUPTION SCENARIO
Source: McKinsey & Company 2016, Automotive Revolution Perspectives Towards 2030
2015 2030
© 2016 ATS Advanced Telematic Systems GmbH
Who are the key players in the market?
© 2016 ATS Advanced Telematic Systems GmbH ATS Research, Aug 2016
0
100
200
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400
500
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Apple Google Alibaba Toyota Motor Daimler VW Uber Baidu BMW GM Ford Continental Tesla
Ma
rke
t V
alu
e [
B U
SD
]
© 2016 ATS Advanced Telematic Systems GmbH Source: Tesla
OTA Use Cases
© 2016 ATS Advanced Telematic Systems GmbH Source: ABI Research 2016, Automotive OTA Updates
MOBILITY
Parking Reservation
Concierge Services
Payment Solutions
App Stores
Targeted Adverts
VEHICLE
Remote Diagnostics
Remote Repair
Driver Assist
Real-Time Parking
Car 2X
Remote Lock/Unlock
SW Updates
E-Call
LOCATION
Traffic and Location Data and
Updates
Car Tracking and Recovery
Hybrid Nav
Geo-fencing
Urban cities, partnering with companies
like Moovel (owned by Daimler) are
creating multi-modal transport options
including parking and payments across
vendors. Over time, as predictive,
personalized analytics grow, it is
expected targeted advertising will
follow to allow recurring revenue
streams.
Dealer visits will be reduced by remote
diagnostics, SW updates and repairs
driven by cloud-sourced cumulative
vehicle data. E-call systems will
continue to grow, with the EU requiring
it in all new cars from April 2018.
Vehicle to infrastructure capabilities
are developing, including security
focused areas like Geo-fencing ( which
can also be used in advertising to
target customers) and car tracking for
stolen vehicles, as well as the
continued developments in map and
traffic analysis.
Current andExpected
OTA Relevance and importance
Market Insight | August 2016 Source: ABI Research 2016, Automotive OTA Updates
IndustryAccelerators
Source: Wired© 2016 ATS Advanced Telematic Systems GmbH
Source: fortune.com© 2016 ATS Advanced Telematic Systems GmbH
Source: bloomberg.com© 2016 ATS Advanced Telematic Systems GmbH
Source: forbes.com© 2016 ATS Advanced Telematic Systems GmbH
© 2016 ATS Advanced Telematic Systems GmbH Source: fortune.com
OTA Business Models
Market Insight | August 2016 Source: ABI Research 2016, Automotive OTA Updates
Recurring Revenue Generator
Race underway to avoid commoditization and
marginalization
Google, Apple, and Chinese adding more comp from
HW and SW
Dealers will already be squeezed out of supply chain
Cost Center and Traditional Sales
Average age of cars is 11.4 years in US
Branding risk from both recalls and Android/ Apple
UX in the car
Complexity and build-approach adding costs; not all
valuable to each consumer
It is estimated that OTA will save up to 60% of the
current time used to complete a dealer led
update.
OEMs are not expected to charge for FOTA
changes, until they are prepared to offer opt-in
enhancements à la Tesla.
Current andExpected
How to make money with a notebook, smartphone or car?
Online-ShopSurfing &
SearchClick
$
Booking PageSurfing &
SearchClick
$
RestaurantSurfing &
SearchClick & Drive
$
© 2016 ATS Advanced Telematic Systems GmbH
Business Models for Connected Cars and Future Mobility?
Purchase UseValue Added
Service
Operation & Maintenance
Sales / New Purchase
? ? ? ? ?
© 2016 ATS Advanced Telematic Systems GmbH
1 OTA strategic part for upcoming models
Large opportunities in cost savings
Multiple revenue models require focus
Significant technical challenges
Make or buy full control vs lock-in?
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3
5
4
Influencing variables for OEMs strategy in OTA
© 2016 ATS Advanced Telematic Systems GmbH
© 2015 ATS Advanced Telematic Systems GmbH – Confidential –
Thank you.
ATS Advanced Telematic Systems GmbHadvancedtelematic.com
Hideo [email protected]
OTA will lead to additional revenues and considerable cost savings
30Source: IHS 2015
-40
-30
-20
-10
0
10
2016 2017 2018 2019 2020 2021 2022
Bill
ion
s U
S-$
Additional Revenue per year
Cost Savings per year
$35.3B
$7.2B
$42.5B
© 2016 ATS Advanced Telematic Systems GmbH