Telematics is not an industry that grabs headlines. Still in its infancy, most telematics technology today concerns such applications as wireless alerts for bus and train arrivals and tracking freight-hauling trucks. But, some manufacturers and analysts are saying that telematics may just be the next big thing in mobile connectivity.

For example, earlier this month at the Digital Car Conference
in Detroit, Intel Corporation displayed its new XScale technology based processors for the telematics market. The new family of microprocessors is specifically designed to bring high-performance solutions to products that deliver wireless voice and data information to vehicles.

The new Intel processors come at a time when telematics terminals are increasingly being included as a feature in new cars. According to industry analyst firm Forrester Research
, roughly 80% all new vehicles will have built in telematics capable terminals by 2006.

“Consumers today have experienced the benefit of initial telematics products and services such as emergency roadside assistance and basic navigation systems, but it?fs only the beginning,?h said Patrick Kerrigan, marketing director of Intel?fs Telematics Operation. ?gThe new Intel processors, based on Intel XScale technology, will help deliver the increased computing performance and the scaleability needed to enable a full-range of products from integrated hands-free cellular phone kits to high-end multimedia ?einfotainment?f systems.”

Telematics has the potential to transform the automobile into a mobile platform capable of providing computing, communications, entertainment, and safety functions, according to a new report from In-Stat/MDR. The high-tech market research firm reports that, due to the compelling nature of their applications for both manufacturers and consumers, all cars will eventually be produced with some degree of embedded telematics systems.

As a result, the number of subscribers to Internet-based telematics services worldwide will rise from approximately 27,000 in 2001 to just over 5 million in 2006, creating opportunities for manufacturers and service providers from the automotive, telecommunication, consumer electronics, and Internet industries. The major players in the market include Telematics Service Providers (TSPs), vehicle OEMs, equipment manufacturers, operating system providers, and chip solution providers.

“Because there are so many players and varying needs, the market for telematics is very fragmented,`` said Cindy Wolf, an analyst with In-Stat/MDR
.

“All players in the telematics industry face opportunities and challenges as they attempt to deliver convenience services to vehicles for which consumers are willing to pay,`` Wolf said. “The opportunities for new revenue streams from airtime minutes, service subscriptions, and content delivery are confronted by the challenges of integrating diverse technologies in a timely manner and in an affordable package.``

The report, Bringing Internet Content to the Vehicle via Telematics Services, also concluded that:
The U.S. market accounts for the majority of worldwide telematics subscribers. Although it is primarily focused on safety and security applications, new services are beginning to be offered that provide personalized Web information, e-mail and dynamic navigation.

Worldwide revenues from telematics hardware and subscriptions to Internet-based telematics services will rise to almost $12 billion by 2006, with a CAGR of 66%.

The growth rate for Internet-based telematics subscribers will spike in 2004, as telematics services will be offered in an increasing number of vehicles and as consumer awareness of service benefits grows.

Related stories on ITN:

(02/10/2001) Wireless transport systems seen as major new market

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