This month we are highlighting research extracts from our QUBE Connected vehicle technologies intelligence service. In this service we review the way in which the vehicle manufacturers are approaching vehicle connectivity, how the supply chain is changing and provide examples of the technologies being used today and being considered for the future. In this interview, we hear from Sanjay Ravi of Microsoft, to better understand Microsoft's involvement in this rapidly changing automotive segment and where he sees the market going in the future.

With passenger cars increasingly resembling smartphone in terms of its connectivity, a number of relatively new suppliers have entered the automotive sector offering electronics, communications and software expertise. One such company is Microsoft and just-auto spoke with Sanjay Ravi, Worldwide Managing Director, Automotive, Industrial & Aerospace, and HighTech & Electronics Industry at Microsoft Corporation to better understand Microsoft's involvement in this rapidly changing automotive segment and where he sees the market going in the future.

j-a: How important is the connected vehicle to Microsoft?

SR: The Global Connected Vehicle Market is a key part of Microsoft's business portfolio moving forward. Here are a few facts to illustrate why:

  • Approximately 20% of in-vehicle navigation systems sold in 2010 are expected to offer connectivity options via an embedded modem or tethered mobile device. This figure is likely to hit 90% in 2017, according to iSuppli, a market research firm.
  • Consumers subscribing to Telematics Services rising from 50m in 2010 to 200m in 2015.
  • New research from Microsoft has shown that cloud computing is being considered as an IT infrastructure solution by manufacturing firms around the globe - driving cost, and helping respond to customer demands faster.

j-a: What does Microsoft have to offer the connected vehicle market market?

SR: As part of the Connected Vehicle initiative, Microsoft offers a wide range of capabilities including:

  • Windows Azure, which is a cloud computing platform, that is gaining momentum in the Automotive Industry - Global telematics platform for Toyota
    Windows Embedded Automotive, in-vehicle embedded solutions being adopted by customers like Ford, Fiat.
  • Analytics and Real-time remote Diagnostics platform
  • Consumer Experience Management solutions

j-a: How do you see the connected vehicle solution evolving and where will Microsoft focus its capabilities?

SR: There are four areas that we are concentrating on and we describe these as the "four pillars". These are as follows:

  • In vehicle power shift: We are seeing power shift to consumers. Consumers actively engaged in social communities can impact a brand in a short time frame and trends in this area influence what is needed in the car.
  • Digital Convergence: A number of studies, including those from JD Power show that the number one driver for buying a car is technology. This is especially important among premium brands where technology has surpassed performance in terms of purchase criteria. To illustrate this, the CEO of Daimler said recently "without a connected vehicle strategy the car companies will not make money".
  • A move from products to services: Data is changing everything and there is a clear move away from individual products to a wide range of services demanded by the consumer.
  • Globalisation: This brings new challenges with opportunities which vary depending on whether you are looking at a developed market or a developing one. Government regulation and legislation is also a key factor. For example in Brazil the government has decreed that all cars need to have a tracking device to help trace stolen vehicles and reduce the very high levels of car theft. This factor alone is driving the connected vehicle market there.
  • Changing demographics also play a key role. The people who buy cars today are different and we need to transform the business accordingly and become more nimble. On the one hand we have to provide a high performance business connected network that satisfies the demands of dealers, suppliers and the consumer. On the other we have to provide a connected consumer service that combines information and communications in the same way as at work and at home. Users want a seamless interface and usage experience.

j-a: Everyone is looking to the cloud as the next big thing in terms of technology. How will Microsoft utilise this in respect to the connected car market?

SR: Within the next decade, the automobile will not only be just a vehicle that takes us from A to B, but it will be a connected device just like a mobile phone. The vehicle of the future will connect to the internet, sending and receiving information that will update drivers and passengers on the go. Automotive companies have realised the opportunities in manufacturing connected vehicles, and understand the benefits of cloud computing and are working closely with technology providers to deliver cloud car innovations.

Along with green technology advances, cloud technology advances in automotive industry are the keys in the industry progress. Ranging from GPS systems to vehicle tracking systems, cloud computing allows businesses in automotive to deliver better and offer more. Already we are seeing automotive navigation systems rapidly transitioning from standalone devices to cloud-connected platforms. Approximately 20 percent of in-vehicle navigation systems sold in 2010 are estimated to have offered connectivity options via an embedded modem or tethered mobile device. This figure is likely to hit 90 percent in 2017, amounting to a total of 27 million units sold per year, reports iSuppli, a market research firm.

Cloud connectivity will make it possible for vehicles to respond to developing traffic situations, find alternate routes and anticipate impending collisions.

j-a: Can you provide some specific examples of vehicle manufacturers that have adopted this approach?

SR: Microsoft and Toyota have recently announced a US$12m venture to bring telematics to Toyotas via the cloud, allowing owners to stream music, connect to information services and manage the batteries in their electric vehicles. The partnership will play a big role in the global expansion of on-board systems capable of better managing overall energy consumption of cars, driving trips and homes.

Overall, the connected vehicle will enhance the driving experience and in order to be successful, automotive companies need to work effectively internally and throughout their value chain by making best use of relevant cloud technologies. Industry boundaries are vanishing; automotive companies now need to be comfortable and thrive in a new ecosystem-one in which they have interdependent partnerships both within the traditional industry and throughout industries.

j-a: Can you provide more detail on the Toyota relationship and some examples of other vehicle manufacturers that you are working with?

SR: The Toyota strategic partnership for Next-Generation telematics is as follows:

  • Microsoft Corp. and Toyota Motor Corp. (TMC) have forged a strategic partnership and plan to build a global platform for TMC's next-generation telematics services using the Windows Azure platform. Telematics is the fusing of telecommunications and information technologies in vehicles; it can encompass GPS systems, energy management and other multimedia technologies
  • As part of the partnership, the two companies plan to participate in a JPY1bn yen (approximately US$12m) investment in Toyota Media Service Co., a TMC subsidiary that offers digital information services to Toyota automotive customers
  • The two companies aim to help develop and deploy telematics applications on the Windows Azure platform, which includes Windows Azure and Microsoft SQL Azure, starting with TMC's electric and plug-in hybrid vehicles in 2012
    TMC's goal is to establish a complete global cloud platform by 2015 that will provide affordable and advanced telematics services to Toyota automotive customers around the world

SR: Daimler uses scalable cloud solution to deliver internet services for an electric car:

  • Daimler, a leading manufacturer of premium passenger cars and commercial vehicles, started to release its smart for two electric drive car to selected customers in 2009
  • The application provides relevant data about the car and its charge state, and is accessible from any Internet-enabled device.
  • For instance, drivers can use the application through an Internet browser on their desktop or mobile phone, which is integrated with Bing Maps, to find public charge spots for their cars. This helps drivers to plan trips and alleviates the fear that they won't be able to charge their vehicle en route to a destination. Drivers can also check the charge state of their cars in order to easily see when it is charged for their next trip

Delphi is also using the Azure platform to deliver rich in-vehicle capability. Globally, Delphi is looking for a rich development environment with in-car services. Looking ahead we are working on a core in-vehicle platform with them.

j-a: Embedded systems are becoming the norm. What does Windows embedded platform offer the car companies?

SR: Windows Embedded Automotive In-Vehicle platform gives car makers and suppliers the latest tools and technologies to deliver engaging in-vehicle experiences like speech commands, touch input, hands-free Bluetooth phone communications, advanced dashboard systems, and rich User Interfaces:

The flexible design of the Windows Embedded Automotive software platform and built-in entertainment and communication applications enables our partners to focus on providing unique and compelling experiences to their customers.
Microsoft continues to showcase its commitment to the automotive industry by:

  • Driving innovation on the Windows Embedded Automotive platform by leveraging the power of WEB's engineering and global marketing team
    Investing in the Windows Embedded Automotive platform to help our partners quickly and affordably bring innovative in-car solutions and services to their customers
  • Strengthening the existing automotive ecosystem by providing them with additional expertise, training and direct local market support via the existing partner team presence WEB has.

j-a: What is the next generation Windows product for the vehicle manufacturers?

SR: Windows Embedded Automotive 7: As the next generation of the Windows Embedded Automotive platform, Windows Embedded Automotive 7 provides car makers and suppliers with access to the latest tools and technology.

Specific features and functionality includes:

  • Silverlight for Windows Embedded. Gives car makers the ability to quickly create rich device UIs with engaging 2-D and 3-D graphics by utilizing a familiar Microsoft technology and taking advantage of a large ecosystem of Silverlight designers. Experiences built in Silverlight for Windows Embedded can be refined rapidly on the desktop and deployed unchanged to the target device facilitating flawless delivery from designer to developer.
  • Microsoft Tellme Speech Technology. Microsoft Tellme speech technology powers simple and hands-free system commands such as allowing the entire interface to be driven through speech.In addition, new support for SMS reply by voice allows text message replies to be constructed by speech. Windows Embedded Automotive 7 also supports eight languages: US English, UK English, German, Mexican Spanish, Continental Spanish, Canadian French, Continental French and Korean.
  • Next-generation Automotive System Tools. New tools for developers support the stable integration of advanced, high-performance third party systems, and include improved test modules with easy-to-use product engineering guidelines to help simplify the development process, increase reliability and speed time to market.

j-a: Could you describe some customer examples where this technology is being used?

SR: Some good examples include Nissan, Kia, Fiat and Ford:

  • Nissan Leaf: A touch screen information hub was required and this is powered by Windows embedded system that includes real-time locator for public charging, timers for air conditioning and other electrical systems. It also provides Bluetooth technology for communication, entertainment and navigation. This is an easily upgradable system that can adapt to the changing charging environment.
  • Kia Motors America: A voice activated infotainment system built on Microsoft TellMe Speech platform, It features a user interface that enable quick and easy access to vehicles multimedia and infotainment systems. Again this system is easily upgradable.
  • Fiat: Partnered with Microsoft to develop the Blue & Me infotainment system. Powered by Windows Embedded Automotive it leverages the latest NUI technology and connectivity.
  • Ford: Developed SYNC with mobile device integration, connected services driven by voice commands. Ford has shipped over 3m units.

j-a: Looking ahead what do you see as the key issues for the connected car business?

SR: As the lifespan of vehicles is much longer than software or applications, extendable in-vehicle platforms will be increasingly common as will be scalable global cloud platforms. Big data real time analytics will provide the core capability required to support remote diagnostics and consumer relationship management will be all important.

See also: QUBE connected vehicle technologies intelligence service (annual subscription)

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