AUTOMOTIVE MULTIMEDIA AND COMMUNICATIONS

Detailed system and semiconductor demand analysis for in-vehicle infotainment, telematics and vehicle-device connectivity features.

December 19, 2014 21:59 rlanctot

The Google-in-the-car rumors are swirling again in advance of CES, the big consumer electronics show held the first week of January in Las Vegas. Of course, rather than being a big coming out party for Google’s automotive initiatives, CES will highlight how far behind Google is in bringing its automotive solutions to the market.

Rumors spread earlier this year that an automotive “profile” would be introduced in Q1 2015 as part of the Android OS alongside the “mobile” and “CE” profiles within the operating system. It now appears that an automotive grade version of the OS or a profile within the OS will not be available until the end of 2015.

This is not to be confused with Android Auto or the so-called Google Projection Mode for reproducing in the car the applications in use on a driver’s Android-based phone. This offering, too, is delayed as was revealed at the L.A. Auto Show last month. Nevertheless companies such as QNX and Alpine Electronics will be showing Android Auto demos at CES.

All of this reminds me of a visit to my sister-in-law in Brazil last year. Vera has a big heart, some might say a soft heart, for animals. She was fostering a stray at the time my wife and I visited.

This stray dog was a very people friendly animal and it cuddled right up with my wife and I to the extent of sleeping with us that night. It turns out that at some point during the evening the dog actually got INTO the bed and under the covers. (I am sure you are seeing the parallels to Google/Android by now.)

Later that morning I learned that the dog that had been sleeping IN my bed with me and my wife was infested with fleas. I freaked out – describing this as a “crisis” – or “crise,” in Portuguese. My wife and sister-in-law got a huge laugh out of that at my expense. Both assured me that those fleas weren’t interested in me, or my wife.

This story came to mind with the automotive industry snuggling up close to Google. Unlike those fleas on that foster dog, Google is VERY interested in everything about the automotive industry but mainly all of the billions of dollars in aftersales revenue associated with car ownership and replacement.

Google appears to have convinced car makers that Android is perfectly suited to automotive applications in spite of its power management shortcomings, hardware requirements and those annoying OS updates. How are car makers going to keep in-vehicle software systems up to date as the storage, processing and screen resolution demands increase with each update?

I can see why nVidia enjoys supporting this scenario, but these should be real deal breakers for the car companies. Yet they continue to dance to Google’s tune. Pretty soon they’ll be scratching.

The real problem lies in Google’s interest in sucking customer data and vehicle use information out of every car it can. This, again, ought to be a deal breaker, but car makers think they can make peace with it.

In my conversations with senior industry executives I hear the same refrain: "We are negotiating with Google regarding how much data we are willing/want to share." It sounds reasonable, but I can't escape the sense that the industry is negotiating its way INTO a hostage situation rather than OUT of one.

Google’s whole mantra is to violate customers’ privacy in the interest of fueling its advertising engine. This IS a crisis for the auto industry. But the car makers, like my wife and sister-in-law, just laugh it off. “Aqui não tem crise!”

Since that visit I have learned that years ago my wife’s family rented their apartment in Porto Alegre to an aunt while they lived in the U.S. It turns out that the aunt had a flea infested animal as a pet which, upon the family’s reoccupation of the apartment, required fumigation to remove all vestiges of its presence. (My wife’s family is solidly middle class and well educated, so please don’t get the wrong idea about them or Brazil or Brazilian pets!)

Let’s hope the auto industry doesn’t find itself facing fumigation to remove Google’s fleas somewhere down the road. We should be careful not to end up being Google’s sucker.


December 17, 2014 14:53 rlanctot

One of these days Microsoft will simply own up to the fact that it does not get cars. The company simply doesn’t understand the automotive industry. Never has. Never will. So even when the company has some success it is somehow overlooked – as in the case of Qoros.

Microsoft’s latest effort in self-delusion vis-à-vis the auto industry is reflected in an article in NetworkWorld touting Microsoft’s vision of the connected car. (http://tinyurl.com/n73h44c - How Microsoft sees the connected car – NetworkWorld)

We have the usual references in this article to Kinect, Azure and Cortana and a variety of other Microsoft assets. What we don’t have is a vision of anything that might actually manifest in the marketplace. What we don’t have is any reference to Qoros, the company’s partner in China’s auto market.

Microsoft is a victim of its internal silos. When looked at from a distance Microsoft looks like an incredibly powerful marketing juggernaut. From a distance all the silos look like a formidable and intimidating forest of opportunity – Bing, Skype, Office, Outlook, Windows.

Up close, however, we see individual trees shivering independently in the cold, damp breeze coming off Puget Sound. Looking at Ford’s decision to turn away from Microsoft we might be incredulous that such an iconic automotive brand would spurn the technology halo Microsoft had once conferred.

But Microsoft simply can’t get out of its own way. It’s not enough that Microsoft has cloud resources, a globally dominant desktop operating system, speech recognition, IP telephony, a popular browser (which actually works in China) and a massive array of intellectual property at its disposal. The company just cannot figure out the industry.

Even more perplexing is the fact that Microsoft has dealer management software and has spent much of the past year working to wean car dealers in the U.S. off of older (and inappropriate) versions of its desktop OS and Office software to the latest version of Windows and legitimate versions of Office. So, Microsoft has assets in the car, in the cloud and in dealerships and has failed to pull off the mother of all auto industry trifectas – a cradle-to-grave connection with car owners.

Competitors from Google to Alibaba and, maybe someday, Amazon are circling the auto industry even as I write these words, looking for ways to capture as much of the vehicle shopping, buying and owning experience as possible. Microsoft remains on the sidelines.

How could this happen? Silos. Without a leadership team – or individual – capable of breaking down walls between functional divisions and define a strategy of shared sacrifice to achieve a larger goal – a foothold in the massive $100B+ automotive aftermarket – Microsoft has been left to stumble around the periphery chipping off worthless scraps of incremental business.

Microsoft is not alone. The IBM’s and HP’s of the world also struggle to come to grips with the nature and scope of the automotive opportunity, satisfied divvying up portions of the business between divisions such as IBM’s Application Integration Middleware, Information Management, Cloud, Industry Solutions, Rational and Global Services.

Of course, these IT companies are biting off $100M-size chunks of business – but they tend to steer clear of the vision stuff. Microsoft, meanwhile, continuously sees fit to blow its automotive vision horn – to no purpose.

Even more strange is the fact that Microsoft continues to push the envelope of innovation integrating IoT elements into its operating system and enabling the merger of IoT elements with user experiences. In most respects Microsoft is right where auto makers might want it to be, but the inability to deliver an integrated solution as part of a larger vision has caused that larger opportunity to unravel.

It didn’t have to be this way. Pay a visit to one of the newest new car companies in the world, Qoros, in Shanghai and you will find a compelling vision of vehicle connectivity in the QorosCloud enabled by Microsoft Azure. There’s no Skype, Cortana, Kinect or Bing. There’s just a well-executed, forward-thinking, award-winning connected car and it's using Windows CE software in the head unit.

So, why, when Microsoft wants to expose the world to the vision of the connected car is it talking about intelligent audio environments in cars (see NetworkWorld article)? Microsoft is already helping Qoros deliver cars with an always on embedded connection (with lifetime access), smartphone integration, and with a competitive customer relationship management system for service scheduling from the vehicle.

We don’t need pie in the sky public relations piffle when we can see a rock solid real vehicle line up already cruising the streets of the Middle Kingdom. Microsoft needs to turn off the hype and turn up the reality. QorosCloud is something Microsoft can be proud of and claim some credit for. I’ll take reality over piffle any day.

P.S. Why doesn't Microsoft bring a Qoros car to CES 2015 in Las Vegas in two weeks?


December 12, 2014 03:23 rlanctot

If there's somethin' strange in your neighborhood
Who ya gonna call (ghostbusters)
If it's somethin' weird an it won't look good
Who ya gonna call (ghostbusters)
- “Ghostbusters” theme song

Ford’s announcement of Sync Gen 3 today based on Blackberry’s QNX operating system (http://tinyurl.com/ohvmfdc - “Ford Sync 3 Delivers New Innovative Ways etc.”) closes one chapter on smartphone connectivity in cars and opens another. The move reflects the rise of Blackberry, the decline of Microsoft Auto and the challenge for any car company trying to make sudden course changes in the same way that smartphone makers do.

The biggest takeaways from this announcement:

When you have a problem in the car business, it’s best to turn to a partner whose business depends on the car business.

Ford and Microsoft were on their way to a double drowning – ie. where the rescuer gets pulled under by the rescuee – before QNX stepped in. Ford needed a clean break with the past, especially after Microsoft revealed its limited ability or interest in cleaning up the MyFord Touch mess.

While Microsoft brought a big advertising budget to the Ford Sync launch eight years ago, MyFord Touch was more of an orphan, the result of a broken marriage. Ford has found a far more motivated and focused partner in Blackberry. Blackberry isn’t so much interested in scoring marketing points as it is in delivering an automotive grade solution capable of better positioning Ford for the future.

It ain’t over ‘til it’s over.

Clean as the break with Microsoft is, the legacy of the relationship will live on for years. Ford Sync and MyFord Touch remain in place on legacy vehicles. Microsoft’s ongoing relationship with Ford has shifted to Azure which, in cooperation with Accenture, is working on a cloud platform for content and service delivery to Ford cars.

Microsoft’s original automotive partner Fiat (Blue&Me) is also working with Accenture which has emerged from the ashes of Microsoft’s automotive ambitions as the automotive industry’s newest Tier 1 supplier. Blue&Me’s future looks bleak and Microsoft’s third partner – Kia Motors (Uvo) – is expected to shift to Android.

But, for all of these car makers, their decision to work with Microsoft will linger in cars like an echo of the Big Bang long after the last Microsoft checks have been cashed in Redmond. It’s enough to give any car maker pause to reconsider those Google and Apple vows.

How important is that infotainment system anyway?

Consumers like to have some sexy stuff going on in the center stack, but the reality is that infotainment tech is a low priority. Safe smartphone connectivity with access to a few apps is a check-off item, but not a deal maker or breaker.

Ford briefly changed this calculus when it was spending $100M+ on television advertising of the original Sync with Nuance speech recognition. But those days are long gone. Few car companies are even mentioning Sirius XM these days in their TV ads. Some may mention the Bose audio system. Honda mentions Pandora often. Most will show a screen in the car in their television ads.

Just make sure the system works and dealers can demonstrate it. That is the new mantra.

Why do I care?

The most interesting thing about the Sync 3 announcement is the ability to do software updates via Wi-Fi instead of needing to use a USB stick. How easy this system will be to use remains to be seen, but this is the most important advance as it shows a more realistic, creative, low cost and customer friendly way to take advantage of Wi-Fi technology to solve real car owner problems – updating buggy automotive software.

This positioning of Wi-Fi is spreading to other cars elsewhere in the world and contrasts with GM’s LTE connection which enables Wi-Fi hotspot capability. There is bound to be a little confusion – especially as Wi-Fi emerges as the preferred smartphone connectivity solution – eventually.

Who you gonna call?

Any car maker in a dark place will note well Blackberry’s incredible Ford rescue mission. Like those guys in the hazmat suits with Shopvacs who show up after the hurricane, Blackberry is helping to put things right at Ford – with the help of Panasonic, of course. The press announcement isn’t all that important – and its late in the week timing prior to CES reflects that unimportance.

File this item under nice to know, but it is especially nice to know if you work for Blackberry. They’ll be celebrating in Ottawa (and Atlanta), or, rather, they’ll be working since Ford quietly made this decision about a year ago and Blackberry and Panasonic have been hard at it ever since.


December 9, 2014 20:15 rlanctot

It’s the 73rd anniversary of Japan's surprise attack on Pearl Harbor and as good a time as any to note that China is seeing an annual slaughter of civilians on its highway on a scale equivalent to the casualties suffered by the U.S. during all of World War II. China’s government acknowledges an annual highway fatality level of approximately 100,000, but the World Health Organization has estimated the actual figure at more than 250,000.

The U.S. lost 400,000 servicemen in WWII.

China is not alone in its struggle with highway fatalities. “Emerging” markets such as China, Brazil, India and Russia are all seeing rising highway fatalities – with India and China as six-figure standouts – as increasingly wealthy and mobile populations take to unprepared and insufficient highway networks as first-time drivers.

The challenge is most pronounced in China, the world leader in highway fatalities, as a result of the country’s increasing domination of the automotive industry. China leads the world in annual vehicle sales and growth and accounts for approximately 25% of global production.

But China is also seeking to lead the world in advanced automotive technologies including everything from powertrains to the development of autonomous vehicles. But this ambition stands in contrast to the actual outcomes on China’s highways.

China’s increasing importance to global vehicle production has brought increasing outside investments in factories and research facilities, all of which have failed to mitigate the highway casualty rate. The only manifestation of any local safety testing or regulatory initiative – China-NCAP (the local chapter of Global-NCAP – New Car Assessment Program – and operated as CATARC - China Automotive Technology Research Centre) – is perceived by the industry and the local media as ineffective, incompetent, corrupt or all of the above.

China’s challenge is one faced by automotive safety regulators all over the world – how to educate, cajole, convince consumers to value safety and buy safer cars and how to nudge car makers to advance and adopt safety systems on more cars. Safety cannot simply be mandated or required. Even under ideal regulatory circumstances there must be a process which includes testing and standards-setting activities.

In “emerging” markets this challenge is compounded by the desire of the government to protect the emerging local manufacturers. In China, this means “protecting” approximately 100 or more local vehicle manufacturers (of which there are more every month) with a combination of import duties and joint venture ownership requirements for foreign car makers seeking to participate in the local economy.

And the egregious highway fatality totals are not solely dependent on the safe and sound manufacture of passenger vehicles. Many, some say most, of the highway fatalities in China – as elsewhere in the developing world - are related to commercial vehicles operating beyond the realm of safety regulations on unsafe highways with stressed or careless drivers.

Also missing is a culture of driving safety. Routine traffic laws requiring the use of safety belts and forbidding the use of mobile phones while driving are routinely ignored. Even lanes on highways are often regarded as “suggestions” by drivers in China along with an overall lack of courtesy to other drivers. These last two factors contribute to rendering lane departure warning systems and adaptive cruise control virtually useless on Chinese vehicles.

If China hopes to make any progress in inculcating its citizens in the values of vehicle safety and reducing highway fatalities to “acceptable” levels, the country will need to achieve greater transparency as to the causes and quantity of highway fatalities. Only when China and its citizens can directly grasp the magnitude and nature of the problem at hand can the industry and the consuming public come together to solve the problem.


December 3, 2014 21:39 rlanctot

I despise the eCall mandate promulgated by the European Union. I hate this decade-old legislative effort primarily because it requires the use of old technology both in new cars and retrofitted into public service access points – the fire departments and local police departments that receive the emergency calls after an airbag deploying car crash.

I believe the eCall mandate set European connected car plans back by a decade as the U.S. crept forward led by GM’s OnStar service and, more recently, by China’s breakneck embrace of embedded connections in cars. But the EU may yet get the last laugh with the latest step toward a firm date for implementation.

To date, the European Union has represented the worst case scenario of government intervention in the automotive market, with the possible exception of Brazil. In the interest of saving a few thousand lives each year the EU has been working on an eCall mandate for about a decade.

I daresay that during that decade many more lives have been lost to wheel spinning testing and standard-setting activities that have dragged out and delayed – FROZEN – connected car development plans throughout Europe. And all of this in the interest of implementing outdated data-over-voice technology in a world increasingly characterized by transmitting voice over data connections.

The eCall mandate for the EU essentially requires all car makers to implement an OnStar-like solution, but without the call center. The latest news from Europe indicates that the European Commission has passed legislation requiring public service access points (PSAPs) in all member states be ready to receive eCalls no later than Oct. 1, 2017. In addition, the “go live date” for the eCall service becomes March 31, 2018 for all type-approved cars to be equipped with eCall.

The EU has even gone so far as to allocate €55M, or about 50% of the total projected cost, in support of the PSAP upgrades for receiving eCalls. A final vote is still required in the new year and wireless carriers have yet to fulfill their obligations under the law to implement the eCall “flag.”

In addition, car makers have already indicated their intention to delay vehicle upgrades to avoid the March 31, 2018 cutoff. (The requirement of the law is that eCall must be added to all new type approved cars meaning that as each car model is updated or as new car models are introduced they must have eCall.)

There is also the slight possibility that more car makers will implement their own private eCall solutions fulfilling the mandate without adopting the mandated hardware and software. The net result is more delays, more confusion and more lost lives, rather than fewer, as a result of the entire convoluted process.

The eCall mandate seriously impaired the EU’s ability to keep pace with car connectivity developments elsewhere in the world such as the U.S. and China. A true connected car stimulus might yet come from the EU in the form of reductions in allowable roaming charges – one of the biggest impediments to broad embedded telematics adoption.

But the one single positive outcome is that the EU has set the bar for emergency crash notification as an automated call for help from a vehicle that has suffered a crash severe enough to cause deployment of airbags. Elsewhere in the world, most notably in the U.S., more and more car makers are straying from this path.

In spite of OnStar showing the way with AUTOMATIC crash notification (ACN) in addition to driver actuated emergency calls via the blue button, a growing roster of car companies are offering non-automatic solutions. So far, Audi and Tesla do not offer ACN with their connectivity solutions and Chrysler requires the driver or a passenger to press the help button for a direct phone call to a PSAP – an approach Toyota is thought to be considering for the U.S. as well.

OnStar may be struggling for relevance in a post-smartphone world, but the one revolutionary feature that OnStar introduced was the automatic call for help. It will be a shame if the industry turns away from this core life-saving design criteria.

And if car makers continue down this path of non-AUTOMATIC crash notification – the U.S. may once again fall behind in the race for vehicle connectivity. But even if that were to happen, OnStar will remain the beacon of ACN worldwide – fitting given that the OnStar program that gave birth to OnStar was called Project Beacon.

There is one more piece of the puzzle some car makers are seeking to avoid: the call center – or as some prefer to refer to it: live assistance. We have crossed a threshold to a world where text messages, data and video feeds and other forms of communication from connected cars require more advanced systems for managing crash scenes remotely. This is no time to abandon the call center, as many companies have done.

I have been a major critic of OnStar for not moving forward quickly enough, but competitors would be unwise to unwind and dumb down the innovations that OnStar pioneered.


December 2, 2014 16:22 kli

January 2014: Tencent bought a navigation and mapping company named 'Linktechnavi' in total 60 million RMB in January, 2014, later on, in May, 2014, Tencent bought 11.28% shares of Navinfo in total 1.173 billion RMB.

February 2014: Alibaba decided to spend $1.045 billion to buy the rest 72% of AutoNavi, after it spent $ 294 million acquiring 28% of AutoNavi in May, 2013.

March 2014: DFM bought 14% PSA's share in 800 million euros

April 2014

  • Tesla started to deliver its Model S to Chinese customers; started to cooperation with China Unicom to build 400+ charging stations in 20 cities in China
  • Baidu's effort in aftermarket product-CarNet cooperation with Tima Networks

May 2014: Tencent's efforts in aftermarket products-Lubao (OBD) box and Lubao App; as well as in OEM market-WeDrive as its TSP brand name togher with NavInfo

June 2014: Pateo's iVokaminiX & Qinggan Car

July 2014

  • Anti-monopoly probe of the replacement OEM parts for foreign OEMs
  • Baidu launched autonomous driving R&D plan in July
  • Alibaba and SAIC's cooperation in Internet car
  • August 2014: Baidu, Tencent and Wanda’s JV in e-commerce O2O 

September 2014

  • Continuous decrease of sale volume in domestic OEMs beginning from September 2014, but Changan, FAW and Dongfeng Fengshen have got the above average growth rates of their sale volumes
  • Guidance of Promoting the transformation and Upgrading of Vehicle Maintenance Industry as well as Improving the Service Quality of the Industry (Document Number: Jiaoyunfa (2014) 186) was regulated by the government aiming at breaking the channel monopoly of the automotive parts in Chinese market
  • Great Wall passed the pre certification for ERA-GLONASS function

October 2014

  • Huawei signed an agreement with DFM, focusing on the cooperation of automotive electronics, intelligent vehicles and IT/ICT information infrustructure; later in November, Huawei signed another agreement with Changan focusing on the cooperation of telematics platform, intelligent vehicle, international business development and information infrastructure.
  • China Mobile signed an agreement with Deutsche Telekom to establish a JV (50:50) focusing on 4G LTE based telematics service solutions

November 2014: OEM's LTE campaign-OnStar's commitment on offering 4G LTE based service in 2015


November 28, 2014 13:04 rlanctot

I published a blog about a week ago (http://tinyurl.com/m8x7tqa - Apple Needs to Buy TomTom Now) suggesting that Apple ought to finally buy TomTom. Apple has been using TomTom map data to prop up its in-house navigation offering and I was suggesting that an acquisition was in order given TomTom’s tenuous market and financial position – the company has had to shift its focus from fast-growth mobile devices to slow growth automotive and fleet market opportunities and, most recently, cloud-based services.

My argument was based on Apple’s ongoing struggle to bring its CarPlay smartphone integration solution to the market following a spectacular debut at the 2014 Geneva Motor Show. In Geneva, Apple had working CarPlay demos in Volvo, Ferrari, and Mercedes-Benz vehicles on the show floor. Fast forward to last week’s L.A. Auto Show and CarPlay is still only a demo with availability in showrooms not anticipated until Spring 2015 at the earliest.

Until last year, speculation regarding an Apple acquisition of TomTom was an annual analyst ritual. It seemed to make sense except for the fact that 1) it never happened and 2) Apple didn’t need to buy TomTom since it was getting what it wanted: TomTom’s maps.

Finally getting the message – that such an acquisition was NOT going to happen – speculation dried up in 2013. There were no more rumors of an imminent Apple acquisition of TomTom. But given Apple’s stumbles I figured the time was right for valor to prevail over discretion. Apple should buy TomTom now, with a small portion of its overseas cash holdings, and straighten out its location strategy once and for all, was my argument.

A colleague of mine at Strategy Analytics, Nitesh Patel, meanwhile weighed in to point out in a blog of his own this week (http://tinyurl.com/kmal6rs - Why Apple Should Ditch TomTom and License HERE Map Data) that Apple would be better off ditching TomTom and licensing rival HERE’s data. HERE’s data set encompasses automotive, pedestrian and in-door navigation for a wide range of applications and at a greater degree of accuracy than TomTom's, or so he argues.

Such decisions ought to but do not always yield to logic. HERE arguably has the superior mapping and location product offering based on scope, breadth of data gathered and accuracy. But TomTom has superior crowd-sourcing elements and traffic data. In fact, thanks to Apple probe data believed to be shared with TomTom, executives in the automotive industry increasingly recognize TomTom as the market leader in traffic data quality – a challenging metric to pin down but one that TomTom appears to have mastered.

Apple has cobbled together a portfolio of location technology and mapping acquisitions including Placebase, C3 Technologies, Locationary, Hopstop.com, Embark, and Broadmap. But a coherent integration of these assets has yet to emerge.

What these acquisitions point to, however, is Apple’s inclination to make bite-sized acquisitions rather than monster purchases of the type that TomTom would represent. (This inclination was noted by commenters to my previous blog.) TomTom’s annual revenue fell below $1B in 2013 and is still experiencing a downward revenue trajectory. But the decline in revenue has not yet assumed the proportions of a crisis and Apple may have more leverage as a TomTom customer than as a TomTom owner.

More importantly, TomTom is bigger and more established than the kind of companies that Apple normally considers as an acquisition candidate. There’s not much upside left in TomTom in the eyes of Apple.

But licensing HERE data will give Apple little or no leverage. While HERE is a far more customer-friendly B2B company today than it ever was in the past, it still marches to its own drum and is unlikely to craft solutions specifically for Apple.

While my colleague’s post made a brave, if brief, case for Apple to license HERE data I believe the far more likely outcome is that both of us are wrong. Apple will continue to license TomTom’s data.

Apple can effectively throw its weight around at TomTom demanding changes or enhancements to the map data. Apple is, by far, TomTom’s largest and most strategic customer.

The licensing of HERE data is the threat suspended over the head of TomTom by Apple like a sword of Damocles. TomTom dare not displease its most important patron.

A potential wild card in the mix is interest in TomTom from other quarters ranging from Alibaba (TomTom’s joint venture partner in China now that Alibaba owns Autonavi) and Facebook to Microsoft or Google. Apple must forever weigh TomTom’s ability to maintain its independence against Apple’s own ambitions in location and navigation.

Perhaps the final question is whether Apple needs either TomTom or HERE in the long run. OpenStreetMaps is always an available option, particularly if Apple chooses to eschew the expensive process of building its own map from scratch. (There is hardly any doubt that Apple has already crafted the fundamental map geometry from its work with TomTom.)

The argument against Apple acquiring TomTom is strong given the fact that much of the value seems to already have been wrung out of the organization. Buying it now for what will likely be a $10B+ price tag becomes a very expensive defensive maneuver.

So, I conclude that Apple probably won’t buy TomTom and probably won’t license HERE data. But I still think the TomTom acquisition is a more likely year-end moonshot than a shift to licensing HERE map data. What do you think?


November 23, 2014 16:46 rlanctot

It’s the fourth quarter of the year and time, again, to consider the possibility of an acquisition of TomTom by Apple. This annual Q4 speculation was missing, for the first time, last year, but much has changed in the past 12 months.

Apple’s strong interest in mapping is manifest in the roster of map-related acquisitions over the years including: Placebase, C3 Technologies, Locationary, Hopstop.com, Embark, and Broadmap. The most significant change since 2013, though, has been the announcement of Apple CarPlay for the integration of iPhones in cars.

Last week’s L.A. Auto Show revealed that CarPlay, in spite of its March debut at the Geneva Auto Show, is still not ready for the market. As noted in an Automotive News blog, the best auto makers can hope for is spring 2015 availability – and likely requiring some sort of dealer update for the high profile vehicles, such as Volvo’s XC90, for which it was originally intended. (http://tinyurl.com/lr3xegl - Apple’s CarPlay Goes Missing in L.A. and in the Showroom)

TomTom has had its own struggles in the automotive market with troubled hardware-centric programs in Europe, most notably Fiat’s Blue&Me Mobile which never made it to the U.S. Perhaps taking a lesson from its mixed experience as a Tier 1 supplier, TomTom’s latest quarterly report shows the company shifting its emphasis toward selling maps, software, traffic and cloud services – not hardware.

The company touted automotive orders of EUR170M, but then had to backtrack a bit during the Q&A session with financial analysts noting that the revenue consisted of map data and updates, software and services to be recognized over an extended period of time. In other words, impressive though the figure was it did not suggest that TomTom was out of the turnaround woods.

Apple, on the other hand, has demonstrated nearly unmatched skill in delivering market-beating hardware solutions along with productive and proven cloud services, navigation and streaming audio applications. But automotive integration has so far eluded Apple.

TomTom’s maps have put Apple into the navigation business and Apple’s probe data has contributed greatly to the enhancement of TomTom’s already strong traffic information services. (Note: Neither TomTom nor Apple will confirm that TomTom has the benefit of Apple handset probe data.)

By working together, Apple has helped TomTom compete with its nemesis, HERE, in traffic services – but TomTom remains at a disadvantage in terms of map quality. As evidence, BMW North America replaced TomTom’s U.S. maps in favor of HERE within the past year. Audi AG shifted its European traffic service business from INRIX to TomTom.

Both HERE and TomTom claim 80% market share, but HERE is likely referring to map data share for embedded in-car systems while TomTom is referring to traffic information. A closer cooperation – ie. ownership based – between Apple and TomTom will enable coordinated improvement of map data for mobile navigation and advertising.

Collaboration between TomTom and Apple will allow Apple to gain a leg up on autonomous driving developments (where TomTom claims partnerships with Volkswagen and Bosch) while TomTom will gain access to indoor navigation technology from Apple. Both companies, in other words, will be able to fill the gaps in their location product offerings.

The argument against an acquisition is that Apple is getting the milk (maps) without owning the cow. But TomTom’s ongoing revenue decline threatens investments in research and map data quality along with its work in traffic and the extension of its product line into wearables.

There are more details to the rationale, but let’s ring in the holidays with a restoration of the annual Apple buying TomTom rumor. With more than $100B in cash held overseas, the acquisition of TomTom makes huge sense. The only barrier is likely to be TomTom greed.


November 21, 2014 16:36 rlanctot

Volvo’s vision of vehicle safety remains something of a lonely voice in the industry. The company is the only car maker pledging as a goal that “no one is killed or injured in a Volvo by 2020.”

That lonely voice cried out at the L.A. Auto Show this week as the company restated its claim to industry leadership in vehicle safety. The good news for Volvo is that there’s never been a better time to pitch safety to U.S. consumers with record vehicle recalls and a flattening rate of decline in annual U.S. highway fatalities.

Safety sells cars, according to multiple Strategy Analytics consumer surveys of car buyers around the world. Safety is consistently a higher purchasing priority than a wide range of other factors, including infotainment and performance.

Volvo expects to sell about 60,000 cars in the U.S. market this year, down from 100,000 units in 2007, its best year. China has become a more important market to the company, volume-wise, but the goal is to return to the 100,000-unit level. The company clearly expects safety to define and differentiate the brand as well as restore the company to six-figure sales volumes here.

What’s new for Volvo is industry leadership in connected safety – bringing together the enhanced sensing technologies intended to avoid vehicle and pedestrian collisions with inter-vehicle communications to enable autonomous operation. Volvo isn’t waiting for standards-setting activities or mandates, it is forging ahead with its vision of vehicle connectivity with a focus on safety.

The company can already point to impressive progress. The company announced at the L.A. Auto show that, since 2000, it has reduced the risk of being injured in a Volvo by 50%, according to the company’s analysis of its own accident database. The company has maintained its own Traffic Accident Research team for more than 40 years.

In fact, Volvo’s model of analyzing accident results in the interest of finding life-saving and injury-preventing solutions may well serve as a model for the industry. In the U.S., the National Highway Traffic Safety Administration has refused to release brand-specific accident data. But some of the most significant advances in safety, such as BMW's cooperation with OnStar to define accident severity protocols for emergency response, have resulted from the analysis of accident outcomes and causes.

Perhaps the most significant developments at Volvo are the company’s efforts to bring together vehicle connectivity and safety. Typically, the work of the safety department of the typical car company takes place in isolation from the team working on what is considered telematics – involving the integration of a telecommunications control unit.

The telematics teams are generally regarding as adding cost to the vehicle (the TCU and related hardware and software) in the hopes of generating subscription revenue. Of course, the TCU is also capable of summoning assistance OnStar-like in the event of an airbag-triggering accident.

Until recently, safety development activities have been focused on tapping camera-, Lidar- and radar-based sensors for collision avoidance applications and assisting driving. Connectivity for safety engineers has been almost exclusively focused on 802.11p dedicated short range communication (DSRC) technology for vehicle-to-vehicle communications.

Volvo is breaking down the wall between the safety and telematics development teams by exploring inter-vehicle communications using the existing embedded wireless device. The Volvo vision, still only in proof of concept phase, will enable Volvo vehicles to transmit safety messages to other Volvo drivers over the wireless network.

Similarly, Volvo is testing 100 cars driving autonomously in the Gothenburg, Sweden, area and using embedded wireless telecommunications connections to share updated roadway condition and map data. For most car companies, the developments taking place in the telematics department and the developments happening in safety have remained segregated. Volvo’s effort to merge these efforts is a ground-breaking development for the industry.

It is also important to note that Volvo has stayed true to the integration of automatic crash notification with the embedded telematics system. At a time when a growing number of auto makers, such as Audi, Chrysler and Tesla, have opted not to include ACN technology, Volvo has brought this capability to 20 world markets.

But Volvo is pushing the safety envelope in other ways existing vehicles on the road today. In fact, in Europe, Volvo vehicles are earning insurance discounts for their safety credentials, an outcome which has yet to cross the Atlantic to U.S. drivers in a significant way.

Volvo’s auto-braking, collision avoidance leadership has been reflected in:

  • Earlier this year, the benefits of the City Safety (low-speed, automatic braking, collision avoidance) technology were documented in an IIHS (Insurance Institute for Highway Safety) report, which stated a collision frequency reduction of up to 22%.
  • A similar study by the Swedish insurance company Volvia shows that Volvos equipped with automatic braking are involved in 22% fewer rear end accidents compared to cars without auto brake.
  • The final report from the EuroFOT research projects concludes that a car with adaptive cruise control and collision warning cuts the risk of colliding with the vehicle in front on a motorway by up to 42%.
  • In the latest report from the Insurance Institute for Highway Safety (IIHS), the Volvo S60 earns the best rating in a new small offset frontal crash test in 40 mph (64 km/h).
  • Last year, no less than five Volvo models - the C30, S60, S80, XC60 and XC90 - earned an IIHS Top Safety Pick.

Volvo’s ongoing work is focused on:

  • Autonomous Driving Support uses data from a camera and radar sensors to make sure that the car automatically follows the vehicle in front in a slow-moving queue.
  • Intersection Support alerts and automatically brakes for crossing traffic when necessary.
  • Animal Detection is designed to detect and automatically brake for large animals, such as elks and large stags.

The all-new Volvo V40 features pedestrian detection with full auto brake - as well as the improved City Safety, which now operates at speeds up to 50 km/h. Among the new features are world-first Pedestrian Airbag Technology, Lane Keeping Aid with haptic auto steering, Active High Beam and a Cross Traffic Alert radar system at the rear.

Some have questioned whether Volvo can continue to lead with so many other car companies adopted lane keeping, blind spot detection, automatic emergency braking and adaptive cruise control technologies. It is clear that, indeed, Volvo has and is preserving its leadership and extending it into pedestrian protection and connected safety to enable automated driving.

Maybe the industry will hear Volvo’s voice crying out in the L.A. desert and join in the vision zero effort – especially during the United Nations Decade of Action for Road Safety. We all want to reduce highway fatalities – which already exceed 1M annually. And let’s not forget that safety sells.


November 16, 2014 11:24 rlanctot

In the era of de-contenting cars we expect to see side-mounted rearview mirrors and door handles go away along with keyfobs, standard transmissions and internal combustion engines. Okay maybe losing the internal combustion engine will take a little more time, but then so will losing the steering wheel, which is where Google has goofed up again.

There are some things about the automotive industry that Google just doesn’t get and one of those is the fact that some of us, in fact most of us, are perfectly happy driving our cars. Some of us even thrive on the driving experience – love it. For Google? Driving is a distraction – a distraction from Google.

So when Google shifted gears earlier this year and re-stated its autonomous driving objective as a car without gas or brake pedals and no steering wheel, the industry took notice. But almost simultaneously the industry shook its collective head and said: “No, Google, we’re not going there with you. You’ve gone too far.”

The reaction consisted of two parts. The first part is pervasive skepticism that a pedal-less, steering wheel-less car is practical, possible or attractive to anyone or for any application. It is hard to overstate the case here. When Google stated its intention of bringing a steering wheel-less car to the market the irresistible juggernaut of Google’s autonomous car program collapsed like a novelty fart bag – pfffft!

The second part is the fact that the driving experience is in the midst of a major revolution and the steering wheel is very much a part of that. Driving is about to become safer, easier and more exciting thanks to leading automotive innovators.

A growing roster of companies is looking to the steering wheel for a wide range of applications from driver monitoring to human machine interfacing. Companies like Neusoft are adding biometric content to steering wheels to monitor the health of drivers, while Seeing Machines is working with Takata to add its driver monitoring tech to steering wheels for everything from commercial vehicle applications to self-driving cars from companies such as General Motors.

But maybe the most compelling vision is coming from Neonode in Stockholm, Sweden, which is using low-cost, LED-based “multi-sensing” interfaces to HMI-enable steering wheels. Neonode is best known for bringing capacitive-touch-like functionality to non-touch displays such as the Sensus system from Volvo. But the company is working to touch enable a much broader range of surfaces – including surfaces throughout the vehicle cabin and for keyless access to the car – enabling a wider range of gesture recognition applications.

Neonode’s vision is not only changing the concept of keyless entry – in the future to include raising or lowering windows or maybe starting the car with gestures – but also the process of interfacing with all manner of in-vehicle systems. In fact, a Neonode-enhanced steering wheel combined with a head-up display will obviate the need for hardware controllers (bye-bye BMW iDrive and Audi MMI) and greatly mitigate the need to glance away from the road.

In fact, the more you think about it, it just makes senses – which happens to be the company’s marketing slogan. Putting interfaces and touch-enabled displays on steering wheels resolves a multitude of challenges including driver distraction and lefty/right issues. And this is aside from the fact that systems for entering and recognizing kanji - used in the biggest and fastest growing automotive market in the world - are best mounted on the steering wheel not only to resolve the lefty-righty issue but to keep eyes on the road.

So, to recap, implementation of Neonode’s multi-sensing system products throughout a car will allow for the replacement of the capacitive touch display with a touch enabled non-touch display, deletion of the hardware controller, significant alteration (if not deletion) of the door handle, replacement of the keyfob (with a key card?) and enhancement of the steering wheel for a variety of new purposes – all intended to enhance the driver’s focus on the road.

Are we ready for Neonode’s vision of turning displays – or any other surface – into interfaces? It makes a lot more sense than removing the steering wheel. If you are attending the CES show, you’ll want to check out what they have on offer. See you there.