Yes, unless we generate data insights by dynamically linking information from inside and outside the automotive world to benefit consumers
The global automotive connected hardware and services market is projected to reach approximately $30 billion by 2023, growing at a CAGR of more than 9% during the next few years according to one report. In the connected vehicle segment of the overall vehicle market, the number of connected cars on the road is expected to amount to 343 million globally by 2023, up from 154 million this year. Global revenue in connected car hardware and services amounts to an estimated $21.5 billion this year.
In many respects the connected car opportunity is overwhelming, with several different routes to innovation. It also represents an unclear proposition to the typical consumer, with many of the same features such as Emergency Brake Assist, AFLS, AEB, Adaptive Light Control, CMS, TLR, Ultrasonic Park Assist, Cross Traffic Alert, night vision, adaptive cruise control and many more, all being given different names by the vehicle OEMs.
Meanwhile penetration of connected cars currently stands at 10.7% of total cars and this is expected to hit 23.2% by 2023. The increasing presence of manufacturers such as LG, Harman International, Denso, Continental, Bosch, and Magneti Marelli is driving innovation in the global market. This segment of connected hardware has estimated revenues of $20 billion this year. And in global comparison, the biggest share of connected car software and hardware revenues are being generated in the US which is estimated to be worth $7 billion this year.
The increasing use of electronics for collision avoidance, parking, lane-keeping and other ADAS systems, infotainment, connected systems, and drive-by-wire technologies are driving the demand in the hardware market.
In the commercial automotive space we see a trend towards ‘Uberization’, more intensive use of fewer vehicles, with the players providing fleet management systems as software-as-a-service which helps in critical business processes such as routing, maintenance, and mileage reporting.
There’s a need to create clarity and simplicity for the consumer
Then consider the different types of software, data and analytics companies working in this space, such as ourselves at LexisNexis Risk Solutions, Bright Box, Airbiquity, Cisco Jasper, Elektrobit, HLDI (Highway Loss Data Institute), Carfax, Cox Automotive, CDK Global, SAP, Reynolds & Reynolds, Vector Informatik, Telenav, Siemens, Oracle, Cenit, Dassault Systemes and the telematics solution providers, and it’s possible to see the opportunity is overwhelming and still evolving. It amounts to many vendors, potentially too many vendor relationships for the vehicle OEMs and a huge if not daunting eco-system.
There’s a dire need to create clarity and some simple steps, simple use cases, that will drive value for the consumer from this technology.
Connected car adoption is increasing significantly compared to the growth of the total passenger car market. The connected car segment is expected to grow about ten times faster than the overall passenger car market over the next few years. Advanced vehicle technologies and ADAS features are increasingly finding their way out of the luxury car segment, into standard and lower-tier models.
The increasing integration of smartphone apps with vehicles is another interesting area that is driving the in-vehicle experience into new areas for both the passenger and the driver.
For example the new Amazon Key in-car service supports the delivery of parcels to the vehicles of Amazon Prime customers, to cars parked in publicly accessible areas, such as a customer’s home or work. It is an example of car and commerce coming together in a way that looks like becoming a new wave of innovation, an entirely new use case for the way we think about personal transportation.
The data flowing out of the vehicle amounts to a torrent of information across previously unconnected business verticals and silos.
These include the core automotive applications (related to production, equipment, repair, services such as infotainment or navigation, onboard software and recall), Product Lifecycle Management (PLM) systems, CAD, CAM, Dealer Management Systems (DMS), parts and after-market management, the repairs ecosystem, insurance and claims management, financials, HR, procurement.
Analytics is becoming the baseline for next-generation vehicle apps, not just for PLM to be able to deliver a personalized vehicle experience, but for the self-driving models that are going to redefine transportation.
Supporting the operations of global OEMs with unified systems across different national boundaries is going to be key.
At LexisNexis Risk Solutions we’ve been working to solve challenges with big data for 40 years, in fact before it became ‘cool’. To power the next-generation of products and services is going to take cross-infrastructure analytics and data-linking across databases, super-computing platforms such as Hadoop, Spark and our own HPCC Systems which are going to be at the heart of everything.
Individual data components work better together, and they can deliver really interesting value for the consumer, when linked together. But how can we express how data linking and data ubiquity is going to work in automotive terms?
The data centric approach is all about normalization, taking noisy data collected from different hardware and software standards, different origins on-vehicle and off-vehicle, and using it to bring new insights (effectively creating new data assets).
A single source of data is insufficient to overcome inaccuracies in the data. At LexisNexis Risk Solutions our platform is built on the premise of absorbing data from multiple data sources (our solutions span financial services, government healthcare, insurance, legal and retail, not just automotive) and then transforming that data to highly intelligent social network graphs that can be manipulated to extract the non-obvious value.
Data disambiguation and linking technology
- A process that links together all records common to a single individual
- Assigns a unique identifier to those records
- Not rules-based, rather it calculates a weighting (specificity) for each value of each field, relative to all the other values for that field found within the data
- Includes fuzzy matching and other capabilities to help find the best matches
- LexisNexis linking technology called Scalable Automated Linking Technology (SALT) provides data profiling and data hygiene applications to support the data preparation process. In addition SALT provides a general data ingest application which allows input files to be combined or merged with an existing base file.
- The LexID and SALT working together use a combination of linking, clustering, analytics, data enhancement and search processes to eliminate both false positives and false negatives using probabilistic learning
- It adds up to create an accurate view of an individual vehicle user or a business.
So it is data insight that is going to fuel the new vehicle services, not the data alone. It’s going to take dynamic linking of data from inside and outside the automotive world to create the necessary consumer experience and consumer engagement.
At LexisNexis® we are the only player in the global market that is pursuing all components of a vehicle’s lifecycle: vehicle build data, vehicle history data and connected car data, such as ADAS with the Global Telematics Platform. By engaging with a vendor that deals with just one of these components you could be missing out on insights that are created when looking between those three fields, when trying to piecemeal a solution from multiple vendors.
The opportunity to use connected car odometer data in synch with readings coming into the vehicle history data is a good example of deriving new synergies from data linking.
New use cases need data linking and data insight
Considering that 3% to 4% of all insurance claims worldwide are considered fraudulent, or put another way, about one in 30 claims is identified as fraudulent, the benefits from insurance telematics alone adds up to a large benefit that can ultimately be brought back to the individual driver, the honest policyholder.
When it comes to the vehicle, the machine is able to make up for what the human mind fails to remember, or may not even have anticipated.
It’s going to be able to do clever things that don’t require the consumer to get involved or expend any effort, such as receive a parcel, send tyre pressure warnings or other vehicle alerts, suggest a faster route to work, suggest a parking space, make an insurance claim, or send an emergency vehicle to an incident.
This is where the technology can really bring financial benefits and service benefits to the consumer if used to their advantage.
Data is going to disrupt many of the existing business models if we think about attitudes to insurance and car utilization, and how that’s changing. It will give us more tools to collect and analyze data. It will also accelerate the pace of change and give rise to unknown risks.
So when we look at the huge capital inflow going into the connected car space, and the number of vehicle OEMs that are moving forward with our own services, there’s grounds for many interesting conversations and positive signals. Data platforms and exchanges are going to be hugely important in defining a consumer’s usage and satisfaction with their car, from the moment it rolls off the forecourt, through the lifecycle. On the journey we need to keep at the forefront, what is it about the consumer, and the consumer need, that unites us all?
LexisNexis Risk Solutions, a unit of RELX Group, is a global data technology and advanced analytics leader, with customers in over 100 countries worldwide.