4G-LTE for the connected car-

Las Vegas CES 2014

The connected car seems to be the hottest topic in the news these days for mobile services. There has been major press releases issued during the recent Consumer Electronic Show of Las Vegas:

– Google cooperation with Audi, GM, Honda, Hyundai , Nvidia with Android.

OpenCar with Mazda

-Telecom operators initiatives: AT&T (AT&T Drive and Drive studio),

Qualcomm with a new chip dedicated to car connectivity (LTE, Wifi etc)

 

Those announcements only highlight the formidable trend towards a fully connected car, a smartphone on 4 wheels that has now become real.

A major business opportunity for car manufacturers

The connected car provides to the car manufacturers with a unique mean to forge and drive customer relationships: a channel to manage customer relations, provide new services and new offers  (including co-marketing) that should allow:

                          – Additional services and additional revenues

                           – A better loyalty to the brand: John McFarland Marketing Director of GM, explained   onTime.com: : “we look at this as an opportunity to maintain a relationship with our customers where they can continue to add content with applications and new capabilities.”

                          –  A 4 to 7 years minimum long term solution with a customer: this should bring clear envy from the telecom operators used to chase each other’s customers on an almost daily basis.

 

Anyway an overwhelming market requirement

 

The Millenial plus generation (15-30 years old) have a basic requirement for connectivity: the connected car can not only be limited to top range models, in view of this major prescription from young generations. Chevrolet has already announced a long time ago that  the majority of its 2015 model-year cars will be equipped with 4G connectivity and multimedia services. Indeed 4G throughput allows  high quality streaming video (live sport channels, on line gaming etc). And when you  start implementing 4G connectivity in the car, you enhance the scope of services delivered as well:

-interpersonal communications: (including video conferencing)

-internet web portal

-multimedia services

-car industry specific services:

                *Secured driving services-help for driving

                                *Navigation-traffic/ augmented reality/toll-parking/fleet management

*Emergency call-E-call (including STF456 standard for its implementation on 4G with IP Multimedia Subsystem (IMS)).

*Preventive maintenance

*experience feedback/reliability

*Multimedia assistance

                                In case of incident/accident (repair)

                                In case of emergency (help)

*Insurance services (tracking services, stop a theft car); options such as insurance pay per km.

 

The 4G-LTE technology is adapted to this evolution

 

The IP Multimedia Subsystem (IMS) architecture:  the 4G-LTE network is a pure data (IP) network  that requires the implementation of IMS for delivering services such as voice (Voice over LTE), as defined by the GSM Association.

Such an architecture means:

o   High level of security for communication and service provision ( requested in view of the sensitivity of the data stored in the car-maintenance, itineraries, driving behaviors

o   High level of standardization allowing easier development of new services (especially  web applications with HTML5)

o   High throughput, low latency and soon almost universal availability (once 4G –LTE is heavily rolled-out especially in Europe), quicker than DSL, allowing true HD multimedia services.

o   An IMS architecture decoupling access network from services that allows long term management of access technology evolution, and allows to keep and control services either through 4G or even 5G in the future. Anyway 4G is likely to last commercially 10-12 years while for example AT&T announced the extinction of 2G services in 2017, a trend that will surely be followed by others as many may refarm their 2G frequencies for LTE services.

 

This has already become real. The main question now for the different actors is how to define the business model and their role in the connected car new paradigm. The relationships between telecommunication operators, service providers, car and equipment manufacturers will definitely need to be reshuffled as the car industry is likely to drive the next phase of mobile services growth worldwide.

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