Atlanta – It’s been three years since Charles Brian Quinn tricked out his Jeep Cherokee with a built-in computer, GPS unit, touch-screen display and wireless keyboard.
“It had Wi-Fi too, so if you pulled up to a Starbucks, you could surf the Internet,” he said of the SUV, which he later stripped down and sold.
While Quinn’s computer- equipped vehicle is long gone, the age of the connected car is only beginning.
After years of stagnation in the industry, analysts say U.S. automakers are poised to usher in the era of the connected-car platform.
Hughes Telematics of suburban Atlanta on Friday announced a partnership with the Chrysler Group to make its connected-car technology a standard feature of the company’s offerings.
Analysts say the agreement makes Hughes Telematics a leading rival to OnStar – the nation’s largest provider of telematics services such as navigational assistance, accident notification and remote vehicle diagnostics – for a market projected to grow to $2 billion in the next four years.
The privately held company’s announcement did not disclose terms of the deal, including when installations would begin or on which models.
It’s also unclear how much the service will cost consumers in monthly subscription fees, although the hardware is expected to cost the manufacturer about $100 per car, Hughes spokeswoman Elke Martin said.
About 13 million cars are equipped with telematics systems, many under the OnStar brand or in corporate fleets, according to Telematics Research Group, which tracks industry trends.
Most of those services – at a fixed monthly cost – focus on safety and security features.
Hughes plans to expand those offerings to include the ability to offer high-speed Internet access, connections allowing cars to join home networks to transfer movie, music and work files, and real-time traffic maps derived from other telematics-equipped vehicles.
Such systems could even save you money on your car insurance … if you don’t mind an electronic spy monitoring your every move.
The company will offer some services on a pay-per-use basis, chief executive Jeff Leddy said.
Technologists predict widespread adoption of connected-car platforms, but analysts say manufacturers have been slow to get on board because of high initial costs, complex technology and uncertain demand.
But the increasing prevalence of wireless data networks and the promise of a steady diet of vehicle sensor information that could help manufacturers reduce warranty and engineering costs is helping convince them that the time is right, TRG analyst Phil Magney said.
The third major U.S. automaker, Ford, is expected to announce plans for a telematics solution in the near future, possibly at the Consumer Electronics Show, analysts say.
Hughes is in talks with other automakers, but there’s no word on any other announcements, Martin said. Hughes is a subsidiary of Hughes Communications, the satellite communications giant based in Maryland.
Hughes sees vast potential for the market.
“The one place where connectivity really hasn’t migrated to is the car,” Leddy said. “And it’s a place where you spend a lot of time, especially in Atlanta.” Outside of corporate fleets, where telematics systems are commonplace, that migration has long been stalled in part because wireless networks weren’t beefy enough to handle the amount of data such systems require at acceptable speeds. Now, they are.
Automakers have also been ambivalent about the technology, largely because of its complexity and uncertain consumer demand for many services, said Belis Askoy, an automotive technology analyst for Jupiter Research.
What’s changed? Automakers have realized that data mined from myriad electronic sensors installed in modern cars would help them reduce warranty costs and save money when engineering new models by identifying trouble spots that might otherwise go unnoticed, Magney said.
Such data collection could prove to be a boon to the driving public, as well.
Traffic maps created using data from telematics-equipped cars could cover an entire metro area for a tiny fraction of the $1 million a mile the Georgia Department of Transportation paid to install monitoring devices on metro Atlanta interstates alone.
Data from wheel sensors, temperature gauges and windshield wipers could also paint a far more vivid picture of road conditions than is currently available, Magney said.
Such capabilities also would allow insurance companies to monitor driving habits and offer lower rates to safer drivers.That’s a scenario that’s already come true in Europe.
Of course, such capabilities would also allow snoopy spouses, or even government agencies, to track a car’s movements with unprecedented ease, giving rise to all sorts of privacy questions.
It’s what Mark Rotenberg, director of the Electronic Privacy Information Center, refers to as “locational privacy.” “Real privacy protection will require ensuring that individuals remain in control over the disclosure of personal information and that, when collection does occur, there are clear rules to minimize abuse and misuse,” he said.
As is the case with OnStar, Hughes’ proposed system would be opt-in, meaning consumers would have to grant specific authority before the system in their cars could be turned on, Leddy said.
For a generation raised with technology and preparing to buy its first cars, such issues may be of little concern weighed against the upside of having 20,000 songs and a direct line to Google built into your car, said car computer enthusiast Derrick Balicki.
“It makes sitting in traffic not quite so horrible,” he said.
Michael Pearson writes for The Atlanta Journal-Constitution.
E-mail: mpearson AT ajc.com ENDIT Story Filed By Cox Newspapers For Use By Clients of the New York Times News Service NYT-01-05-07 1954EST
