The future of the automotive ecosystem is heading toward the integration of multiple domains, such as the Internet of Things (IoT), connected vehicles, autonomous vehicles, and V2X communication. The integration and shift in focus will make software-defined cars to be the essence of connected cars in future. Moreover, as the eco system expands, the market would notice extreme competition from both proprietary and open source solution providers.

The refresh cycle of Telematics hardware has drastically evolved from a 5 year to 2 year timeline. OEMs have invested billions of dollars in creating a platform which addresses consumer needs and maintains brand differentiation. The development cost incurred here is the result of developing the same solution from scratch for every model refresh. Additionally, creating one such platform is time consuming.

This has led to development of in-house expertise to drive ownership of the data and provide greater leverage, brand value, user experience, and ultimately, value-added services. OEMs need a platform and design where they can upgrade just one component which will allow them to offer newest technologies with their car upgrades.

The landscape of Tier 1 is drastically changing from past. Earlier it was integration and provision of a solution to customer, but now it is more a custom design of systems starting from modems, antennas, software, and cloud services. This has called for the need of modularity and standardization.

Google’s Open Automotive Alliance noticed approximately 50 OEMs and 20 technology partners promoting Android auto. The GENIVI Alliance has been working on open source software architecture for infotainment and it features compliant solutions from major Tier I companies such as Aisin, Continental, Delphi, HARMAN, Magneti Marelli, and Visteon.

Qualcomm recently partnered with Google and mentioned plans for an Android Nougat-based car platform. The open source solution is expected to tap into body and vehicle related data to create new software-defined models.

The News: Partnership between giants – HARMAN & AT&T

Along with AT&T, HARMAN is creating a generic Telematics platform which will appeal to most of its customers and is pre certified with latest requirements, developed and ready to be adopted in the vehicle development platform – aiming to reduce the time to market for the OEMs.

The telematics control unit will be a part of AT&T’s Mobile Broadband Accelerator program – which already has partners such as Telit and Sierra Wireless offering components for development of connected car solutions. AT&T’s certification program ensures availability of tested, off the shelf solutions which will serve as base for connected car offerings.

“This domain is fast changing and every OEM requires changing their solution frequently, so instead of going through the cycle of development of new hardware again, they could adopt the generic platform.” – says Vishnu Sundaram, head of Telematics at HARMAN

“Apart from hardware it will allow HARMAN to bundle the entire connected car solution. This appeals smaller OEMs who are in their first or second generation of Telematics where they don’t want to go and source each and every component. If we could offer the entire package of hardware, connectivity, cloud, services and software – this reduces their time to market and adds significant value for them.”

There are a lot of partners for the MBA program, chipset providers, module providers, and telematics providers – the goal is to leverage the synergies and innovation from all the participants. HARMAN, who is the pioneer with its modular Infotainment platform (VW group), aims to build Telematics solutions involving the components from existing MBA partners –using pre certified and pre developed products.

HARMAN’s Telematics Approach

The company’s TCU solution continues the company’s track record of introducing industry-first connected car solutions that enable greater power, productivity, and personalization, including enabling GSM, GPS, Wi-Fi Hotspots, and LTE network connectivity. HARMAN offers a modular hardware and software platform that is forward looking to support the future 4.5 G and 5G spectrums.

HARMAN plans to offer two platforms as a part of the AT&T MBA program, as below:

  1. The entry solution is focused on OEMs who are looking to offer connectivity and a few use cases around safety and Infotainment.
  2. Modular Platform which would focus on harnessing the computing capability that is available on the telematics platform to run applications which deliver much higher value to the OEMs such as V2X applications, OTA update gateways, and security daemon capabilities which secure the entire network in cars. In terms of LTE connectivity the entry module will focus on CAT 4 technology and the modular would focus on CAT 6 to CAT 16.

HARMAN believes there would be two areas of evolution for the TCUs: one being the form factor where there has been evolution in packaging telematics and RF components as one and the other one being Modularity which requires minimum intervention with base design to offer scalability in the future.

Talking about the update gateway, Vishnu mentions “Cars of today have become software intensive and hence require software maintenance. With the update gateway solution that runs on top of the TCU, we enable OEMs to update every ECU including the legacy ones in the car, thereby putting software related recalls to rest.”

Changing Landscapes: Acquisition, Standardization and Modularity

The Industry has moved beyond legislation bringing in Telematics in Europe. Telematics will become a part of every car in 2020 – this is strongly backed up by the RFQ pipeline from OEMs. They are clearly looking at value beyond basic safety mandates. OEMs are focusing on providing added safety and convenience features to users and in the background using the telematics to reduce the maintenance cost of the car after sales. OEMs have started realizing benefits of reducing warranty and maintenance costs with respect to telematics solution. Technologies like update gateway will help them reduce software recalls.

Panasonic’s recent acquisition of OpenSynergy – German embedded software company, Samsung’s expected approach with Magneti Marelli has already hinted heated competition between the Tier I companies.

Last year HARMAN was in the news for strengthening its software portfolio with $1 Billion investment on Towersec, RedBend, and Symphony Teleca. AT&T, the network giant in North America – who has most of the automakers to its Connected Car program clientele along with HARMAN, is expected to pave way for the next generation Telematics platform with the MBA program.

HARMAN now is one of the most advanced Tier I company in Connected Car space. With a two platform strategy which caters mass, mid, and luxury segment of automotive, this announcement will be a key to determine the market position for HARMAN in North America. Additionally HARMAN is also working on partnerships with carriers in other geographies and similar approach can be noticed in Europe very soon.

This has put the positions of legacy Tier I suppliers such as Bosch and Continental in jeopardy now – who seem to have changed focus on autonomous vehicles. However, with the after-sales revenue from value added services adding up to more than $1 Trillion by 2030, the game has become much wider and open to all the value chain participants.

About Frost & Sullivan

For six decades, Frost & Sullivan has been world-renowned for its role in helping investors, corporate leaders and governments navigate economic changes and identify disruptive technologies, Mega Trends, new business models and companies to action, resulting in a continuous flow of growth opportunities to drive future success.

Frost & Sullivan

For six decades, Frost & Sullivan has been world-renowned for its role in helping investors, corporate leaders and governments navigate economic changes and identify disruptive technologies, Mega Trends, new business models and companies to action, resulting in a continuous flow of growth opportunities to drive future success.

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