Telematics Drive Big Changes in Auto Insurance Industry

Insurance CIOs buttress their information management systems to accommodate tidal wave of customer data

 

Traditionally, automobile insurance companies based their premiums on variables—a driver’s gender and age, the number of miles driven each year, a driver’s accident history, and credit scores—that have a strong correlation to risks and accidents. Drivers deemed risky typically have incurred higher auto insurance premiums.

Today, insurance companies are beginning to leverage technologies that make it possible to monitor and capture causal data on the actual driving patterns and behaviors of individual customers. Telematics, as these technologies are collectively known, use advanced sensors installed in cars or on a customer’s smartphone to gather data on when and where an individual drives, on what types of roads, and on actual driving behavior (e.g. rate of acceleration, braking force, cornering, and speed), among other variables. The devices transmit the data to the insurer via a cellular or satellite connection, where they are analyzed to create a statistically accurate risk profile.

By using variables based on actual driving behavior, insurance companies benefit from being able to match premiums more closely with actual risk. Drivers benefit from the opportunity to lower their insurance rates by driving more safely.

“We are going from a world in which insurance carriers used statistically developed proxies that could not account for individual variation, to one in which insurers can actually watch you drive,” says John Lucker, a principal at Deloitte Consulting LLP who is the global leader of the firm’s Advanced Analytics and Modeling market offering and an insurance analytics specialist. “For years, automobile insurance rates have been set from a variety of variables, some of which showed a strong correlation to claims experience. However, these variables did not show, definitively, how specific driving behaviors affect an individual’s risk profile. The implications of this shift to the use of telematics data for insurers are dramatic. The automobile insurance industry will likely realign around this capability.”

For insurance industry CIOs, this means working with a growing array of telematics device vendors to secure and implement the right technologies to support a company’s strategic goals. It also means laying the data management groundwork necessary to retrieve, store and analyze massive amounts of data that will be flowing from millions of cars to insurance carriers.

“CIOs in the insurance sector will likely play a vital role in telematics initiatives going forward,” says Stephen Packard, a director with Deloitte Consulting LLP who specializes in strategy development for insurance carriers. “The data they collect and organize can enhance product development, underwriting, customer service, and claims analysis.”

Tools of the Road

According to Mark Hill, a specialist leader with Deloitte Consulting LLP who specializes in strategy, business model redesign, and performance improvement, almost every leading insurance company currently has a telematics product or pilot in place. Some trial programs offer premium discounts of up to 50 percent to customers who allow auto insurance carriers to outfit their cars with telematics monitoring devices. So far, says Hill, the pilot programs have been effective. In addition, “a market leader in this space recently announced that nearly one million customers were participating in its telematics initiatives, and that it had accrued roughly 5 billion miles in driving data,” he says.

Hill defines the telematics systems these insurers are test driving as “the intersection of source data, telecommunications and analytics.”  The keystone of these systems is a monitoring device—offered to insurance companies in various iterations by a growing list of vendors—in a customer’s car that captures and transmits data on driver behavior in real time.

According to Hill, carriers are currently working with three basic variations of telematics devices:

OBD-II Port Device – Since 1996, new cars in the US have included an on-board diagnostic (OBD-II) system that monitors a car’s systems and subsystems. (When trying to diagnose a problem, auto mechanics often download diagnostic data from the OBD system). The most common telematics devices plug into a port in the OBD system. The device contains software and sufficient flash memory to read and capture OBD data and often includes a cellular modem to transmit data and other sensors such as an accelerometer to measure the car’s g-force during acceleration, braking, and cornering. It also uses GPS to record location data and to calculate driving distance.

In-Car Interactive Device: These devices collect similar driving information to the OBD-II devices but do not connect to the OBD system. Instead, they use GPS components to monitor the car’s speed and travel distances.  Several of the available portable devices have speakers that allow insurers to coach customers on their driving skills in real time. For example, the device can deliver an audible prompt if a driver takes a corner too fast or brakes too hard. Like the OBD2 Port device, this model transmits data to the company via a cellular teleservice connection.

Smartphone Apps: Some insurance companies offer smartphone apps that leverage the phone’s accelerometer and gyroscope in addition to a phone’s GPS system to monitor travel speed, frequency of travel, location, and driving style. They also use a smartphone’s network connection to transmit captured data to company databases.

Hill notes that telematics devices like these can generate enormous amounts of data depending on the number and frequency of variables tracked. As part of any telematics initiative, CIOs should make sure that the insurer has effective information management and data warehousing systems in place.

“Some companies are collecting upwards of 20 or 30 variables on a second or subsecond basis. Depending on your strategy, you could have small or very large amounts of data coming out of a vehicle. Insurers should consider all the practical aspects of data collection so that they can achieve their telematics objectives without drowning in data.”

Data, Data Everywhere

According to Lucker, insurance industry CIOs can lay the groundwork for capturing and managing the data effectively and supporting strategic telematics goals by working closely with the business from the earliest planning stages of a telematics initiative.

“By clearly understanding what the business wants to accomplish with telematics, the CIO can improve alignment of ITs efforts with these goals,” says Lucker.

To implement the tools, systems and processes likely required to effectively support a telematics strategy, the CIO should also understand a project’s granular data needs. For example, what kind of information does the company need to collect: GPS data or just mileage? How much data do actuaries need to make accurate pricing decisions for customers?  What will be the lag time between data capture and analysis? What specific telematics tools (data capture, teleservice, analytics, information management) will be needed to support the company’s strategies in major and secondary markets?  Will the same tools be used for fleet service clients? The CIO’s list of data-specific questions will likely be long, because companies are having to build their telematics capabilities from the ground up.

“Currently, there are no independent repositories of telematics data that insurance companies can license,” says Lucker. “CIOs and other insurance leaders are starting at the very beginning.”

Packard says that to remain competitive, auto insurance companies may have no choice but to embrace telematics fully, and without reservation.

“This industry is conservative and doesn’t change quickly. Some companies see telematics as an aberration, and want it to go away,” he says. “It likely won’t happen that way. Telematics is used widely in Europe and it is poised to sweep across the automotive insurance industry in North America.”

  Source: http://deloitte.wsj.com/cio/2012/11/30/telematics-drive-big-changes-in-auto-insurance-industry/#!

How Connected Cars Have Established A New Ecosystem Powered By IoT 

Not long ago, after you bought a new vehicle, the manufacturer had very little contact with you for years until it was time to sell you another car. The Internet of Things is changing all that. The IoT-enabled “connected car” turns the vehicle itself into a hub for an entire ecosystem of connected services that offer consumers a wealth of benefits including enhanced safety and security, a richer user experience and a new suite of product offerings. From the manufacturer’s perspective, this also helps establish an ongoing customer relationship as well as incremental revenue streams over the life of the vehicle.

Across the world, 23 million cars on the road today are connected to the Internet, and that figure is expected to increase to 152 million. Historically, GM vehicles have been a hub for additional services, like its OnStar safety and security services. And in this past year, new vehicles in the U.S. are now equipped with 4G LTE mobile hotspots, with even more services promised in the future.

More vehicle manufacturers are jumping on board, as well, adding value-added connected IoT services to more new vehicles. Let’s take a look at some of these new connected car services and how IoT is providing the foundation on which this ecosystem is built.

Mobile hotspot

Gone are the days when being in the car meant you had to be disconnected. Many of today’s vehicle manufacturers are introducing in-vehicle mobile hotspot capabilities, giving both driver and passengers the ability to stay connected while on the road. In addition to GM, Audi equips its vehicles with Gemalto enabled mobile hotspot services through its Audi Connect service and Ford’s new Sync 3, powered by BlackBerry’s QNX, is included in more than 30 million vehicles spanning 250 models.

Because vehicle manufacturers are leveraging IoT platforms that enable connectivity via a network of mobile operators, passengers can connect their laptops, smartphones and tablets to the car to surf the Internet, watch movies and access social media. And for drivers, they’re loyal to the manufacturers who enable them to enjoy the benefits of this new in-car experience increases.

Over-the-air updates

Over-the-air (OTA) software updates in cars are very similar to the software updates that occur in smartphones. Any software update for a vehicle’s connected services is done wirelessly OTA, keeping the OEM in contact with the vehicle but removing the need for a dealership visit.

This matters because in the past year alone, over 60 million cars were recalled in the U.S., many attributed to software glitches. The cost – and burden – that recalls place on the driver and the vehicle manufacturer can be severe.

Many manufacturers are making strides to increase OTA offerings. Thanks to Gemalto, Audi provides features such as parking and gas prices using OTA updates on its Audi Connect solution, while GM has been offering OTA updates to its Bluetooth platform using the OnStar embedded connectivity platform. OTA updates are slowly becoming an industry standard – Chrysler UconnectMercedes-Benz mbraceBMW ConnectedDrive and the Toyota Entune systems regularly send firmware OTA updates to fix software glitches in their vehicles.

Infotainment

Sure, cars have been enabling us to connect our devices via Bluetooth to make calls and navigate – but what about the ability to use your favorite streaming apps to get the content you love without having to fiddle with your phone while driving and consuming valuable data plans? By leveraging the always-on connectivity that IoT provides, today’s connected car manufacturers are providing an entirely new interface for delivering and interacting with streaming content services like Spotify or Pandora.

IoT platforms also provide an easy way for content providers to monetize their services and optimize them for the connected car environment. Vehicle manufacturers, premium content providers, and even brick-and-mortar retailers can use IoT to give car owners a free trial of their services or other offers. OnStar’s new AtYourService feature brings commerce directly to the car, connecting retailers to drivers while they’re on the road. Online coupon services like RetailMeNot and Entertainment Book can deliver shopping coupons to the car’s dashboard for retailers located in the driver’s direction.

 

And IoT isn’t just about getting the service to the car – it also enables providers to track usage (or non-usage) patterns, prompt drivers to try new features, top up a diminishing data allotment or upgrade the service when the time is right. IoT has become the strategic platform to help deliver and monetize these services. 

Safety and security

Safety and security remain the most important aspects of any vehicle. And with today’s connected cars, IoT enables the vehicle to continue to fulfill that role even after an accident has occurred. For example, IoT empowers pre-installed services like Volkswagen’s Car-Net with 24/7 automatic crash notification, which can automatically alert emergency services when an accident has occurred.

These possibly life-saving features are wholly dependent on reliable, low-latency connectivity, because a delay in notification (and the resulting delay in medical response) can literally mean the difference between life or death.

Usage-based insurance

Another emerging value-added service enabled by IoT is usage-based insurance (UBI), which tracks a driver’s behavior to establish a personalized insurance rate plan for each driver. Whereas insurance providers were previously limited to providing rates based on general factors like age, average mileage, accident and history, IoT provides a myriad of opportunities for customization.

For example, Allstate’s Drivewise program uses a small device deployed in your vehicle to collect information about your driving style. Data points collected include speed, brake activity and the time of day you drive. By collecting this data, Allstate can customize rates for each driver, incentivizing safe driving behavior and reducing premiums. Allstate has also partnered with Airbiquity, a provider of connected vehicle services, to further develop the insurer’s Roadside Assistance program offerings that leverage driving data.

A number of startups are building off this idea of collecting driver data. Commercial plug-in modules like those from start-up Mojio connect cars to the cloud via embedded radio links and upload hundreds of data points about the car every minute, tracking everything from the brakes to the locks. It then uses these data points to provide connected car services in partnership with apps like Concur to measure gas mileage and Glympse for GPS tracking.

A new business model

IoT is turning the vehicle into a powerful hub, enabling developers, manufacturers and service providers to offer value-added services and effectively changing their relationship with customers.

Connected services strengthen the vehicle manufacturers’ relationships with their customers and enhance brand loyalty – all while developing new and ongoing revenue streams throughout the life of the vehicle. Manufacturers can monitor customers’ experiences in real-time and on the road, enhance product quality, and investigate potential post-sale opportunities. And in turn, service providers are encouraged to explore an open platform for the production of apps that bring innovation to drivers and their passengers.

Armed with the power of IoT, vehicle manufacturers are on the leading edge of evolving user experiences and new business models based on IoT services. It’s no longer about a one-time product sale – it’s about creating an ecosystem wherein they can deliver and monetize services on an ongoing basis.

The connected car industry’s successes have been a guiding light for many other markets as we see businesses everywhere embrace the evolution from a product company to an IoT services company.

Source:http://techcrunch.com/2015/01/31/how-connected-cars-have-established-a-new-ecosystem-powered-by-iot/

Telematics May Become a Reality Beyond Auto by Jim Sadler

Editor's note: Jim Sadler is CIO of Xchanging.

The joys of the open road. The wind in your hair. Just you and some music on the radio. But are you really alone in the vehicle? Increasingly, we’re accompanied on our travels by a little black box, or even our own smart phones masquerading as little black boxes, betraying our driving style and habits back to some unseen data warehouse.

Meet your new co-driver: telematics. No longer just a techno nerd’s laboratory experiment, telematics—simply defined as the use of wireless devices to transmit data in real time back to an organization—is becoming big business in the automotive industry, and has the potential to transform the entire insurance business across almost every personal and commercial line.

Telematics as a mainstay

By 2017, it’s estimated that more than 60% of the world’s vehicles will be connected, actively monitoring the safety and security of vehicles and drivers. In fact, Progressive, which launched the first telematics product in 1998, has reported that it accounted for more than $1 billion in premium revenue for usage-based insurance policies (i.e. paying according to how many miles you drive or how well you drive).

Progressive is forecasting that over 25% of the entire U.S. automotive-insurance premium revenue will be generated via telematics by 2020, representing more than $30 billion.

Whereas much of the development has been around usage-based systems, telematics devices are now far more detailed in the information they provide when it comes to the insured’s driving behaviour including the time of day, travel, location, speed and acceleration.

In a way, this is risk that can be modelled to the infinite degree. Your insurer now knows everything about your driving habits. They’re not relying on an actuary’s interpretation of how a 35 year old with 15 years’ experience might handle a six year old Porsche Boxster 3.4 S. Even though the ability to discriminate by gender when pricing an automotive policy has been ruled illegal, why should insurers be bothered? Not when they now have access to information that is far more insightful than the statistical broad brush of yesteryear.

Beyond automotive usage

The ability to then use telematics and profitably tap into a market where 92 percent of drivers are reported to believe that their premiums should largely be based on the way they drive should be very attractive.

Very exciting, but why stop at automotive when it comes to developing insurance policies that truly reflect the actual risk—not simply an actuary’s perception of risk? The life sector for one could benefit. How about an app that measures your vital signs such as blood pressure, heart rate and overall physical health in real time and feeds information continually back to your insurer? The Quantified Self Movement is already pioneering the use and development of self-tracking tools that help people make sense of their personal data. Are you fitter than the average 40 year old? Then telematics could be a way for you to secure lower premiums.

Commercial lines such as property could also benefit. What about smart buildings that are able to relay information about their operation in real-time? If a window is left open overnight, perhaps that information could signal a security risk to the owner so it doesn’t happen again. But premiums could also be adjusted to reflect the changing risk profile.

The insurance business really does have an opportunity to transform the way it does business from the pricing of risk right through to claims handling and day-to-day communication with its clients.

Of course, there is a price to pay. It was Greta Garbo who pleaded ‘I want to be alone.’ To that I say ‘good luck’ in an electronically connected world where your every move can be monitored and assessed. But if it leads to a more relevant insurance product and a cheaper one for many, then I’m sure it’s a price that most will be willing to pay.

Source: http://www.propertycasualty360.com/2013/12/17/telematics-may-become-a-reality-beyond-auto?t=analytics-data

 

 

 
Software - the new battleground for carmakers by Edward Taylor and Ilona Wissenbach

 

A BMW i3 electric vehicle is prepared for a display during set up for the 2014 Consumer Electronics Show (CES) at the Las Vegas Convention Center in Las Vegas, Nevada, January 4, 2014.

CREDIT: REUTERS/STEVE MARCUS

(Reuters) - The new Mercedes-Benz C-Class has cameras that can read road signs and sensors to judge distance to the car in front, but is not yet able to make full use of the hardware.

What may sound like a shortcoming is in fact a deliberate strategy by manufacturer Daimler (DAIGn.DE), and a sign of things to come for the global luxury car industry.

Owners of the upscale Mercedes compact will be able to add new functions such as predictive cruise control - which lets the car drive itself in some situations - by updating the car's operating system when the technology becomes available.

Taking their cue from gadget makers such as Apple (AAPL.O), Daimler and rivals are developing cars to receive software updates that include new tools or even improve fuel efficiency, much in the way an iPad gets new capabilities with each successive operating system.

That is a big change - and a potential saving - for an industry used to spending heavily to revamp ageing models.

"We are entering a new era," Mercedes-Benz development chief Thomas Weber told Reuters. "Until now, cars retained the properties they had on the day they were purchased."

Daimler's push shows software is emerging as a new battleground among carmakers seeking to use technology to make cars safer, more entertaining, and better at solving problems such as locating a parking space or the nearest hospital.

While the aircraft industry has long relied on computers to fly planes, cars have been held back by insufficient broadband telecoms infrastructure, the price of computing power and regulatory limits to automation.

But software is now set to become as important to carmakers as traditional engineering, according to Thilo Koslowski, an analyst with IT and research group Gartner Inc.

"What we are witnessing is a change that will impact the industry for decades to come," said Koslowski, who used to work at German luxury carmaker Audi. "The next venue of competitive differentiation will come from software."

SMART CAR

While some drivers remain sceptical about surrendering control, many are ready to embrace functions which let them access information, make calls, e-mail or listen to music in traffic, according to auto supplier Continental, which interviewed 4,000 car owners in Germany, Japan, U.S. and China.

"What a customer knows from his smartphone, he will also expect from his car," Mercedes' Weber said in an interview.

In anticipation of rapidly changing customer tastes in so-called infotainment, Audi introduced a system which allows customers to swap hardware components when they become outdated.

Gartner's Koslowski believes the promise of software updates will become a major selling point for carmakers. "The average consumer doesn't really detect advancements in mechanical engineering. But they understand an upgrade in infotainment," he said.

Software is also starting to help drivers in a myriad of other ways. For example, it allows drivers of BMW's (BMWG.DE) i3 electric vehicle to gauge whether a battery has sufficient charge to reach a destination. In some cities, the car can even help to look up the timetable of alternative transport methods such as trains and buses, and find a nearby charging station.

Increasingly, system updates can alter a car's actual driving performance. An upgrade to Tesla's (TSLA.O) electric Model S sedan, for instance, commanded the suspension to increase ground clearance at highway speeds.

Software can also modify engine regimes or shut down some cylinders to adjust the balance between efficiency and power in real time, reducing fuel consumption.

Mercedes-Benz, meanwhile, is working to offer predictive cruise control in its cars and trucks, a tool to adapt a vehicle's engine revs and gear to suit the gradient of a slope.

Currently maps used in satellite navigation systems are not able to gauge the gradient of a particular road, a feature that will emerge as maps evolve, enabling Daimler to develop software for more cost-efficient driving, Weber said.

"If the car is equipped with the right hardware, you can add functions at a later stage," he said ahead of next week's Detroit auto show which will showcase the new C-Class.

The promise of advancements in software has led Mercedes-Benz to overhaul its research and development operations in California. It plans to double resources at a new headquarters in Sunnyvale, where around 100 staff work, although it declined to put a timeframe or figure on the investment.

NEW FRONTIERS

Ian Robertson, BMW board member in charge of sales, believes software can be used by automakers to expand into completely new areas of business that go beyond driving.

BMW has invested in ParkatmyHouse.com, an online parking marketplace which brings together owners of private parking spaces and people in search of parking. The service has more than 400,000 customers.

Upgrades to software are not always popular, however, as Microsoft (MSFT.O) found with its Windows 8 operating system. Increasing complexity in vehicles can also bring problems.

Renault (RENA.PA) blamed glitches with the R-Link touch-screen entertainment and navigation panel for delays to its Zoe electric car, while Ford (F.N) tumbled to the bottom end of U.S. vehicle reliability rankings because of flaws in its rival MyFord Touch system.

Few doubt, though, that the growing power and ambition of on-board software can only accelerate in the next generation of upscale cars.

Manufacturers will "switch to an architecture that controls vehicle function through software" to reduce weight and production costs, Forrester Research said in a recent report.

"New features and updates (will) come principally from software rather than hardware." (Additional reporting by Laurence Frost; Editing by Mark Potter)

Source:http://in.reuters.com/article/2014/01/10/autoshow-daimler-software-idINDEEA090ET20140110

 

U.S. study of automotive location data raises privacy concerns
 

The government's research arm found that data-hungry in-car location services could use some improvement in the privacy and consumer notification departments.

The Government Accountability Office's report prompted U.S. Sen. Al Franken, D-Minn., the longtime comedian and political pundit, to call on Congress to pass a location-privacy bill.

"Companies providing in-car location services are taking their customers' privacy seriously -- but this report shows that Minnesotans and people across the country need much more information about how the data are being collected, what they're being used for, and how they're being shared with third parties," Franken said in a statement.

"This report also underscores the need for me to reintroduce and pass my location privacy bill. It's just commonsense that all companies should get their customers' clear permission before they collect or share their location information."

The report can be downloaded in .pdf form here.

The Location Privacy Protection Act was the first of several privacy bills introduced in the past few years to make it out of the committee stage a year ago. If passed, it would require companies to obtain user consent before collecting or sharing mobile location data. Expect the new GAO report to influence updates to the bill.

The report, released publicly this week, evaluates the practices of ten firms that enable location-based services for vehicles, including six auto manufacturers: Chrysler, Ford, General Motors, Honda, Nissan and Toyota.

Navigation device makers Garmin and TomTom, along with map and navigation application developers Google and Telenav were also included. The report looked at the types of car-related data collected by the firms, what they use it for, and whether their privacy and data protection practices jibe with industry guidelines.

All of the automakers share location information with third parties, according to the GAO, to provide services such as traffic information, connections to live operators, or telecommunication and information processing for global positioning systems, known as telematics.

All firms evaluated share location data with law enforcement, and some offer aggregated data not associated with individuals to "university research programs, the National Highway Transportation Safety Administration, and state departments of transportation for research purposes … and to improve information about traffic patterns for infrastructure planning."

Selling to insurers?

Location data could theoretically be sold to insurance firms to better target services based on driving habits or to aim ads at drivers based on where they are. Through small devices installed in cars by a small crop of beta testers, mobile app developer Dash Labs tracks 300 data points including the car location, the type of vehicle being driven, who's in it and the time of day the driver is behind the wheel.

The firm, not evaluated in the GAO report, aims to sell the information to insurance firms or automakers, and counts Foursquare founder Dennis Crowley among its advisers.

"Dash will not share individual driver data with third parties without explicit opt-in from the user," said Dash CEO Jamyn Edis.

The GAO report suggests that the companies' disclosures about privacy practices are sometimes unclear.

"Without clear disclosures about the purposes, consumers may not be able to effectively judge whether the uses of their location data might violate their privacy," notes the "In-Car Location-Based Services" report, originally provided last month to Franken, chairman of the Privacy, Technology and the Law Subcommittee.

"Furthermore, risks increase that data may be used for purposes the consumer is not expecting or to which the consumer might not have chosen to agree," adds the report.

Recommendations

The GAO recommends the companies give people using their services more control over the location data collected.

"None of the 10 selected companies allow consumers to delete the location data that are, or have been, collected," states the report. Some of the firms do not retain location data, or they de-identify it so it cannot be connected to individuals. However, four of the firms reviewed, which go unnamed in the report, do store location data tied to individual vehicles.

"In such cases, consumers are unable to prevent the retention or use of retained data, should they wish to do so," the report said.

The researchers also indicated that a contractor working with three of the firms studied may store data including specific locations visited, vehicle identification numbers and other information for as many as seven years.

The longer data is stored, suggested the GAO, "the more vulnerable the data are to use by bad actors, such as hackers, or to unauthorized third party access." 

 

Read more:

http://www.autonews.com/article/20140109/OEM06/140109855/u.s.-study-of-automotive-location-data-raises-privacy-concerns#ixzz2qImax3qp 

Are Cars Turning Into the Ultimate Mobile Device?

By Luke Kintigh, iQ Managing Editor

 

 

When it comes to mobile technology, most people think of small portable devices, not a two-ton machine. But today’s automakers are embracing smartphone and mobile computing technologies that will safely integrate our digital lives into our driving experiences.

A record nine automotive firms are appearing at the 2014 Consumer Electronics Show to highlight new tech innovations that are redefining mobility. Instead of bringing your tablet from your home to your office, you might have a dashboard that brings your Internet access in a safe way while you drive. 

“What's remarkable is seeing how well the automotive industry fits into CES,” said Elliot Garbus, general manager of the Automotive Solutions Division at Intel.

“It's a busy time and the presence of automakers continues to grow.”

Intel will be showcasing two vehicles at its CES booth this year. According to Garbus, who’s responsible for delivering Intel’s vision for connected cars, spanning from in-vehicle infotainment(IVI) systems to intelligent transportation systems.

IVI systems offer real-time info, voice recognition, and in-car connectivity to mobile devices and the Web, letting consumers seamlessly carry their daily digital habits into their cars. In-Statforecasts that more than 35 million IVI systems will ship in 2015.

“There’s a lot of focus on IVI because it brings differentiation,” Garbus explained. “We're seeing desire by consumers to maintain a connection with their digital lifestyle and that’s influencing their purchasing decisions.”

Services like Pandora are already being integrated into cars, and experts predict more apps will be built into vehicle design to create a mobile phone-like experience for drivers.

In the near future, a problem could be fixed by having a car download a software update, whereas automakers in the past would have had to issue a recall. Such innovations are allowing auto firms to maintain a connection with customers and provide continuous improvements. More than 42 million cars are expected to be equipped with Internet access by 2017, according toiSuppli.

Automakers are also introducing sensors that provide “computer vision,” which allows cars to see the road, detect blind spots during lane changes, and even warn drivers about bicycles or pedestrians nearby.

“I've seen NHTSA Data reports stating that about 90-percent of the recorded accidents are a result of human failure of the parties involved," said Garbus. "Now we’re seeing tech that’s leading to self-driving vehicles, and more automakers are trying to design an accident-free vehicle. Computing combined with sensors can create cars that are aware of their surroundings and provide a safer driving experience by controlling the car directly or warning the driver. It’s about using tech to help keep drivers safe.”

Semi-autonomous and fully self-driving cars are closer than ever before, but given the industry’sfour- to five-year design cycle, most of the advanced models showcased at CES may not hit the market until 2018.

Intel’s Intelligent Systems Alliance is hoping to accelerate the development timeline by harnessing more than 2,500 tech solutions based on the latest processor technology. By collaborating with companies like Jaguar Land Rover, Intel aims to speed time-to-market for intelligent driving systems by sharing its research and development experts and resources.

“We have great research in Intel Labs on leveraging user experience inside cars, understanding how people use their cars, and how to enable cars to leverage their tech to enhance experience,” Garbus noted. 

That means that soon, the mobile device you use most often might not be in your pocket, but in your driveway.

Read more from Intel iQ on the future of automative and technology

Subscribe to the CES 2014 Flipboard magazine to stay updated on the latest trends and announcements from CES.  

 

Images courtesy of Intel Free Press and Jaguar Land Rover.