The Next Internet Boom: Connected Cars

An estimated 62.3 million global consumers will have Internet access in their cars by 2016, up from 970,000 at the end of 2009, according to iSuppli Corp.

“With smart phones having become more affordable and ubiquitous, consumers are demanding Internet connectivity in cars,” said Egil Juliussen, principal analyst and fellow for iSuppli’s Automotive Research Service. “Car makers are serving this demand by adding various forms of Internet connectivity to cars.”

The United States is expected to be the leading region for car Internet access in 2009 and during the next six years, with users rising to 28.3 million in 2016, up from 520,000 in 2009.

Car Connectivity
Internet connectivity in cars has been implemented via telematics systems using either embedded solutions or Hands-Free Interfaces (HFI) to the entertainment or navigation system. Telematics refers to the solutions and applications built on top of information content flowing via wireless communication to and/or from cars.

Telematics systems presently use low bandwidth connectivity, and are not suited for current Internet applications. This is about to change as the number of Internet connections in cars will grow dramatically during the next decade.

Initial car Internet connections are not coming from the auto manufacturers, but via smart phones with data plans that are used with mobile device telematics systems, such as Ford Sync. The main exception is BMW, which has introduced an embedded telematics system with a data plan on the 7-Series in Germany.

Another exception is the cellular-to-Wi-Fi router system that was pioneered by Chrysler in 2008 and now also is available from Cadillac and Volkswagen. Similar systems are emerging in Europe.

The cellular-to-Wi-Fi router solutions are embedded in a car and can be used by any Wi-Fi enabled device in or near the car. There also are aftermarket cellular to Wi-Fi router products from Sprint and Verizon, but these are mobile systems that are not connected to any systems in the car.

Both current telematics systems and Internet-connected systems have a bright future. During the next five years the two categories will be distinctly different. However, during the long term, telematics systems will add broadband communication links with data plans and Internet connectivity will be common. By 2020, probably all telematics systems will be Internet-enabled and the two categories will merge.

Information Superhighway
With Internet applications and content are set to make a major impact on car drivers and passengers during the next decade, there will undoubtedly be new and innovative car-centric Internet applications and services.

However, there will also be usage restrictions due to driver distraction issues while driving a car. Better interfaces with minimal driver distraction for Internet-based content will emerge in the next few years—some to be enabled by new infotainment systems and architectures.

There is also a tremendous impetus coming from the mobile device world, with an explosion of applications related to mobility. Some of these applications will also find their way into cars.

Source : iSuppli, 16/12/09