Wireless carriers AT&T and Verizon recently announced the development of connected car service programs, with AT&T focusing on automakers and Verizon going consumer direct. With the recent move by GM to move from Verizon to AT&T in its factory-equipped OnStar systems, the stage is set for both companies to take completely different business development paths.
AT&T entered into partnerships with Tesla and Audi along with GM to drive the expansion of M2M (machine-to-machine) connected vehicle technology, which utilizes the advantage of 4G data speeds to deliver advanced voice control, diagnostics and other infotainment services from the cloud. This infrastructure, particularly the use of low-latency LTE connectivity, enables large-scale applications such as fleet management, security and navigation. Audi recently reported that it intends to roll out 4G LTE capacity across its complete lineup of cars.
AT&T’s agreement with Tesla stipulates that all current and future models will be compatible with AT&T’s high-speed wireless network and will use AT&T’s connected infrastructure to power engine diagnostics, telematics and infotainment features. AT&T also announced a partnership with Samsung on its connected-car lab in Atlanta called Drive Studio, with a host of developers including Glympse and Audiobooks.com offering their apps on the AT&T Drive platform.
Losing GM’s factory OnStar wireless business to AT&T has not deterred Verizon from leveraging the business potential for connected car services. With over 200 million vehicles already on the road and in need of connectivity, Verizon took the opportunity at the Detroit Auto Show to announce an aftermarket connected car program named Verizon Vehicle. An OBD-II module is inserted in the vehicle and a Bluetooth-enabled speaker is attached to a sun visor, and together with a downloaded Verizon Vehicle smartphone app, the system replicates much of the vehicle location, roadside assistance, diagnostics and emergency alerts available through OnStar without the need for factory-installed cellular modem. And the system will work regardless of which wireless carrier is used by the driver.
The technology itself is similar to other plug-in dashboard gadgets like Automatic, Mojio MetroMile and Zubie, suggesting that Verizon could implement other services such as user-based insurance or linking the car to connected home devices. The addition of a 4G LTE modem will enable the vehicle to act as a mobile hotspot, further expanding the system capabilities.
AT&T and Verizon will likely be followed by other wireless providers (as well as SiriusXM Satellite Radio) in delivering connected car services, repurposing their existing wireless infrastructures and chasing incremental business opportunities. We expect to see the connected car market disruption intensify this year as more tech companies enter the fray.
Source: AT&T Joins Automakers for Connected Car Business – Zacks.com