Is Automotive Cloud a game changer for the auto industry?

Today’s automotive market faces significant challenges in the current economic context and many car manufacturers are taking advantage of the latest ICT solutions to stand out from the competition. Advances in cloud computing and mobile communication technologies enable the vision of the always connected car which offers many new possibilities to the auto industry. In this blog post I will focus on explaining the benefits of cloud computing to the automotive industry and consumers alike.

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The connected car paradigm is gaining in popularity as can be seen at large trade shows (e.g. CES) and in new products that are appearing on the market. Major car manufacturers are starting to offer onboard WiFi, 3G and LTE solutions and design onboard head units that can take advantage of cloud connectivity and dedicated applications. Industry commentators are well versed on the connected car: Mark Boyadjis, senior analyst at HIS Automotive highlights that “There’s a lot of connected-car growth right now. The vehicle is actually the third-fastest growing connected device behind smartphones and tablets.” The Carmesh project and Zylia are embracing these trends to build a next generation telematics platform that brings social and mobile revolution into the automotive world.

The shift to cloud hosted services brings many benefits to car manufacturers. Typically in the automotive context, onboard computers with large multimedia displays were offered at a premium price due to the significant equipment cost. The cloud computing vision can reduce costs of in-car systems by moving some of the functionality to the cloud, resulting in a cheaper on board computer acting as a thin client to cloud services. Cloud services can also be used for remote firmware and application updates, making the onboard system more future proof, which is very important in the context of an average car lifespan of 10 years.

Car manufacturers are embracing cloud technologies. For example, Ericsson recently announced that Volvo will use the Ericsson Connected Vehicle Cloud technology to enable in-car cloud services.  The companies have signed a 20 year deal and demonstrated first prototypes showing live TV streaming and music streaming (using Spotify) to the car as well as diagnostic feedback from the car. Many more applications will be provided in the future through agreements with content providers, city authorities, road-toll operators and others.

In another partnership that was announced in 2011, Toyota joined forces with Microsoft to build a next-generation telematics platform based on the Windows Azure cloud platform. The main goal for both companies is to establish a complete cloud platform by 2015 that will provide affordable telematics services to automotive users. The platform is also targeting electric and plug-in hybrid vehicles that rely on telematics services for efficient energy management. The new cloud platform will enable real-time car diagnostics, battery status monitoring and in the long term will help to build a smart and efficient electric car ecosystem.

Cloud computing technologies can also bring significant advantages to consumers. Always on connectivity enables new services such as in-car local searches for points of interest, social network-based POI recommendations and up-to date traffic information for the navigation system. Driver and passengers will have immediate access to all the infotainment content and services that they are used to from their home environment. These new features will be especially appealing to the new generation of consumers that are immersed in the mobile apps world. The automotive cloud will increase not only consumer satisfaction but also safety. New applications such as cloud-based speech recognition, live safety announcements and automatic crash response will  increase car safety and may reduce the number of car accidents.

The future for automotive cloud looks very bright right now but there is still a long way to go to realize the vision of fully connected cars. Car manufacturers must act smart to convince the consumers to engage with the new ecosystem. One way of doing this is to make every new car cloud enabled with a thin client and broadband connectivity bundled in the price of the car. With a large install base, revenues will come from services and advertisements rather than hardware. Automakers can also make deals with mobile operators to offer service subscription plans instead of the current data plans. Finally in order to provide high quality services it is crucial to make the automotive cloud as reliable and secure as possible.

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