The future of vehicles needs the IT industry more than it realises
Wireless Technologies

The future of vehicles needs the IT industry more than it realises

Finland is a country most people would associate with lakes (it has 187,888, more than any other country), heavy metal music, the Mosaic internet browser and companies such as Nokia. Few would perhaps know that it’s the home of the Air Guitar World Championships and fewer still would associate it with the automotive industry. In Scandinavia, you wouldn’t be wrong if you suggested Finland’s neighbour Sweden was perhaps better placed for anything to do with cars, after all, Sweden has produced brands such as Volvo, Saab and Scania. So, why is Finland making a play for autonomous vehicles?

According to a recent ResearchandMarkets report, Autonomous Vehicle Market: Global Drivers, Restraints, Opportunities, Trends, and Forecasts to 2023, revenue is expected to grow at a CAGR of 39.6 percent between 2017 and 2027 reaching $126.8bn by 2027. This is big business so understandably any country would be foolish not to want a slice.

For Finland, the answer lies not in the automotive industry itself but in what it believes are the integral opportunities in software and services. It’s the potential supporting technologies and infrastructures that are interesting the country’s technology and engineering businesses and those, of course, in other countries too.

At a recent Frost & Sullivan talk at the Finnish Ambassador’s Residence in London’s Kensington Palace Gardens, a fleet of automotive, tech and telecoms people mingled amidst its ornate rooms to discuss the intelligent vehicle industry. Interestingly, there was talk of changing cultures, shifting from a closed world to a more collaborative one, something that will challenge even the most optimistic of automotive businesses.

“Some still think it's about shiny metal and nice lamps,” said Vesa Kiviranta, vice president of automotive solutions at software firm Symbio, one of a number of Finnish representatives at the event. “Nothing wrong with that but the industry is changing fast. Customers are thinking about the experience. It’s becoming a smartphone on wheels but this means there are plenty of up-selling opportunities for car sellers through online services.”

 

Safety first

The challenge for tech businesses is to galvanise those opportunities but where to start?

“Safety,” said Dr Thierry E Klein, Nokia’s head of innovation management for vertical industries. “It's about saving lives and time.”

Alex Guillen Estudillo, marketing manager for software and services business Insight UK, agrees. Guillen Estudillo points to developments in IoT and AI as key technologies.

“With government figures revealing that over 24 thousand people were killed or seriously injured in car accidents in 2016, the industry is well-known for high maintenance costs, accidents and injuries,” says Guillen Estudillo. “In recent years, insurance companies have been playing a more proactive role in helping drivers adopt safe habits through the implementation of IoT technologies. By collecting a wealth of information about vehicles and drivers, IoT measures a range of factors from speed, seatbelt usage to over-acceleration. From speech or gesture recognition to driver condition evaluation, AI applications can use the data gathered from these IoT technologies to predict an individual’s behaviour and act on their needs – becoming a key component in how we move.”

Certainly, data driven services have a home in today’s as well as tomorrow’s vehicle industry. We all know data analytics is already big business and that will only accelerate with increased use of AI engines. The transport industry is already benefiting. David Rosen, TIBCO's digital transformation technologist and strategist talks about the Dutch Railways and how it’s using sensors on trains and tracks and integrating data with smart phone connections and global satellite tracking.

“Triangulation of multiple sources gives Dutch Railways access to comprehensive and highly accurate views of every train – in real time and with near zero downtime,” says Rosen, pointing out that through analytics the company can address the uncertainly of arrival times and make that information transparent and readily available to passengers.

 

Telematics

Bringing this granularity to service is where tech firms can deliver on many of the blue sky wishes of the automotive industry. It’s about adding intelligence and mobility, understanding where technology can bring cost savings but also increase the customer experience, whether it’s on trains, flights, buses or autonomous vehicles.

“Tech firms are the key enabler in making the autonomous vehicle a reality,” says Andrew Lee, head of market intelligence and analysis at Octo Telematics. “Today in the form of telematics, they already enable a host of services for the motor industry from infotainment, solutions for safety and security, solutions for reducing the cost of vehicle ownership and even ways to monetise your vehicle through car sharing. As we see the rise in ADAS (Advanced Driver Assistance Systems) and eventually fully autonomous vehicles, the tech firms will increasingly play a critical role.”

Lee suggests that enabling insurance firms to “forensically understand events such as an accident and who is liable,” is a good example but while many tech businesses may not be so enamoured with this idea, the reality is that insurance firms will drive a lot of the early development. Guillen Estudillo agrees.

“Implementing AI technologies based on insights drawn from IoT gives insurance providers the ability to adjust their premiums based on real-time driver data,” he says. “By measuring real-time data such as time of day, speed, distance travelled can help insurers to create personalised rates and offer better deals for safer drivers such as a pay-how-you-drive policy. The benefits of this to insurance companies can help retain and attract the lowest-risk drivers, as well as those with the highest lifetime value.”

For the automotive industry, it’s about building new relationships between the drivers, passengers, manufacturers and insurance firms. Within these new relationships there will be opportunities but also a few dangers, potentials for dead ends and expensive mistakes. From cloud-based infrastructures through to multi-modality and apps, tech firms will find increasing avenues for business but it is not without risk. The move to autonomy is an evolution not a revolution. There will be no big bang but there will be change and the tech industry should be well placed to take full advantage.

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Marc Ambasna-Jones

Marc Ambasna-Jones is a UK-based freelance writer and media consultant and has been writing about business and technology since 1989.

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