Automotive Telematics Deliver a Brave New Ride

It’s Saturday, which means you have chores to do. You jump in your minivan and turn the ignition. Without being told, your favorite song is cued, your seat is automatically heated to your preferred temperature, and you are reminded of about how many miles you can drive until you need gas. “Oh,” you think, “I’ll get gas first.” With the touch of a button, your navigation system shows your current location and the price of gas at the five nearest gas stations.

Welcome to the world of telematics and the new wave of automotive in-car technology that’s quickly finding its way into our vehicles.

Telematics is deeply embedded hardware, software and telecommunications systems that provide an increasingly wide range of applications that serve our vehicles. These applications can enable safety, security, monitoring of vehicle health and remote diagnostics services. For the driver and passengers, telematics systems can provide dynamic location-based services such as navigation, traffic information, emergency assistance and a suite of other driver services based on two-way connectivity.

The icing on the cake is the idea of bringing the Internet to your vehicle. Automakers are working with Web companies to devise ways of connecting this technology intelligently, and advertisers are ready to jump on board and make it cost-effective, all to integrate your vehicle into the connected world.

Today’s vehicles are already providing a glimpse of what lies ahead. Many already have their own personal computer, their own cell phone and a display monitor. Add a keyboard or touch pad in-dash and the possibilities are endless. It all depends on how much information about yourself you are willing to provide. Data such as your blood type, favorite restaurants and even the stocks you own can prove useful. Ultimately, you will be able to tell your vehicle what you want it to do and when. Want an alert sent to your cell phone if your vehicle alarm goes off? Want to let your significant other know if your airbag has been deployed? Want to know when you’re driving by your favorite coffee shop? Easy to do; your vehicle will be as smart as you let it be.

Global automakers are working toward making telematics the core of the connected vehicle, and they have a strong incentive to integrate this technology as quickly as possible. The competition from connected mobile devices has clearly acted as a very powerful stimulant. Personal Navigation Devices (PNDs) and smart phones are grabbing the consumer’s fancy, and navigation systems are on a lot of wish lists.

PND manufacturers are heavily reliant on sales and are aiming their brand of navigation as a service product. As more devices have navigation capabilities, it won’t be about the hardware but about the service – something that provides two-way communication and lends itself to the consumer’s lifestyle.

Even automakers are realizing that it’s the suite of services that will help them achieve success. The wireless mobile and wireless automotive communities are fighting tooth and nail to win consumers’ hearts and minds.

One industry that is highly interested in telematics is the insurance industry. As more in-car technologies become available, automotive insurers have the opportunity to collect driver data with as much or as little granularity as they desire. They can monitor vehicle location, speed and driving times, or they can collect data on specific, narrowly defined events, such as hard braking. With better underlying data and the accompanying ability to price risk more accurately, insurers can roll out new types of products, often targeted at customers previously considered uninsurable. Information collected in the vehicle can also be used during the claims process. The overwhelming obstacle is the business issue of cost.

This is where advertisers are chomping at the bit to jump on board. Enabling these systems in your vehicle carries a cost, whether it’s a monthly subscription based on usage or a flat fee, and bringing advertisers into your vehicle can lower the cost considerably. So whenever you download a movie into your vehicle for the kids to watch on the next trip, it’s likely to be sponsored by an online movie provider. A major quick lube company will gladly make arrangements for your next scheduled oil change.

Advertisers also see the value of “knowing where you’re going” as a valuable customer relationship management tool. Remember those Saturday chores? Heading to a home improvement store? A telematics- equipped vehicle offers advertisers sophisticated, location-based options never before available. It’s all about capturing a consumer when they’re ready to make a decision. Let your system know you’re going to a home improvement store, and you get a quick glimpse at a discount being offered by one of the major chains. Once your vehicle is detected going to that location, the incentive is activated. You get something in return for sharing your data. Advertisers love that.