Telematics 101

Telematics is a funny word. When it first started gaining popularity about a decade ago, a few of us sat around and tried to make up a better word to describe what we were doing. We obviously failed.

The word really fails to describe what “it” is and consequently, misunderstanding ensues. I define telematics this way:

When a vehicle has the ability to know it’s location and engage in a two-way conversation, it is capable of telematics

There are many ways for a vehicle to know its location and communicate. Traditional telematics involves embedding a cell phone and tapping into native vehicular GPS. The cell phones are typically programed to dial only one number, a private call center, although one automotive OEM, GM, has sold cellular minutes.

Traditional telematics is rooted in safety and security services and include the following:

Automatic Collision Notification (ACN) – when an airbag is deployed, the vehicle’s location is sent to a call center. An operator speaks with the occupants and routes emergency services as needed

Stolen Vehicle Location Assistance (SVL) – upon receipt of a filed police report for a stolen vehicle, an operator will attempt to open a communication channel with the vehicle and pull it’s location information

Emergency Services (SOS) – at the push of a button, an operator can be reached and provide assistance

Roadside Assistance – at the push of a button, an operator can be reached and location information sent to a tow truck to provide help required

Several structural issues limit traditional telematics widespread success. The first is relying on cellular technology. In order to survive a crash, most OEMs will put the cellular module deep inside the bowels of the vehicle. This means it cannot be swapped out if cellular technology changes say from 2G to 3G to LTE, which we all knows happens. When cellular technology changes, it’s not just the cellular radio and chipset that need to change. It’s wiring, connector pins, antennas, and a host of supporting hardware and software that has to change as well. Second, cellular technology is widely deployed for population coverage, not geographic coverage. Core vehicular safety and security services need geographic coverage as well as population coverage. Cellular coverage, even in high population areas, is spotty and not ubiquitous. Thirdly, relying on wireless carriers necessitates a subscription, something customers loath, especially for services that do not get daily usage, which thankfully, core safety and security do not get. And here is a shocker, wireless carriers charge OEMs a lot of money for buckets of voice minutes and data. AT&T and Verizon Wireless are in the business of maximizing subscriptions to their networks and making money. They can force automotive OEMs into less than favorable terms because OEMs don’t’ have much choice, for now.

Core safety and security typically rely on specially trained operators to handle the emergency calls. Telematics Service Providers (TSPs) are specialized call centers that coordinate services with Public Safety Answering Points (PSAPs) to deliver emergency services. The main TSPs are OnStar, offering services only to GM vehicles, Verizon Telematics (formerly Hughes Telematics) servicing Mercedes and VW, and Agero (just purchased by Sirius XM so, expect a name change) who services BMW, Toyota/Lexus, Nissan/Infiniti, Hyundai, and Honda/Acura.

Almost all OEMs offer a core safety and security package with a variety of prices for the hardware, trial lengths for the subscription, and annual charges. For example, BMW’s Assist includes 10 years of safety and security in the price of their cars; GM’s OnStar offers one year of service and then $199 annually; Toyota’s Safety Connect offers one year of service and then $140 a year thereafter; Hyundai’s Blue Link Assurance package comes with 3 years of service and is then $79 annually.

Ideally, core safety and security services in the vehicle will migrate to a more appropriate communication technology that is geographically ubiquitous, doesn’t change often, and does not require a subscription.

Once the vehicle is connected and knows it’s location, a host of other services can be offered. I will review these services in another entry along with smart phone integration solutions. Spoiler alert: it is a mess.