With those questions in mind, the opportunity
for industry players hinges on their ability to:
- Quickly build and test data-driven products
and services focused on appealing customer propositions.
- Develop new business models built on
technological innovation, advanced capabilities and partnerships that push the
current boundaries of the automotive industry.
The car data monetization opportunity begins
with an environment in which customers believe that there is something of value
in it for them and that the cost is worth the benefit.
Certain use cases rely on driving-related or
systems data (route, vehicle usage, etc.), while others require users to share
more personal data, such as the content of personal communications. Analysis
from a McKinsey study found that customers are more reluctant to share the
latter type of data, but that 60 percent of them are willing to do so when the
feature is safety or convenience related, giving auto manufacturers a path
forward to integrate these new features.
The partnerships are critical here and to that
end, the Toyota Research Institute (TRI) announced
that it is creating a user consortium and hopes to
stimulate more rapid adoption of blockchain technology by other companies
developing autonomous vehicles and providing mobility services. TRI is inviting
current and future partners to collaborate on further development of distributed
ledger applications in vehicle data and services.
Modern vehicles are increasingly aware of their
environment through onboard sensors and are increasingly connected to the
cloud, roadway infrastructure and other vehicles, all of which are generating
massive amounts of valuable data. Blockchain technology may create an
opportunity to share driving and autonomous testing data in an environment that
preserves ownership of the data by the creator.
The thinking is that blockchain technology will
allow companies and individuals to securely share and monetize their driving
information and access the data contributed by others in a secure marketplace.
This approach builds on a similar blockchain initiative to create digital
property rights in the music industry, the Open Music Initiative. Looking to companies adjacent to the automotive industry in
addressing secure data marketplaces is mission critical for some of these
Some key players are already active in the car
data space, setting business models, use cases and monetization options to
capture the opportunity within the space.
Original equipment manufacturers (OEMs), for
instance, are already becoming active in car data analytics to better
understand how customers use their cars, shape their repair and maintenance
choices and improve the link between dealers and customers, allowing for things
like real-time, remote booking of vehicle check-ups.
Automotive suppliers are developing the software and hardware that are forming the
infrastructure capable of capturing, analyzing and selling car data. Although
the range of technologies and applications spans widely, suppliers are now
facing the challenge of understanding how to leverage data to reach end
customers directly, better serve their B2B customers and improve their own
product and services portfolio.
Insurers are able to capitalize on car data by offering usage-based
insurance contracts, exploring occasion-related policies (like short-term,
location-based motor insurance) and extending their understanding of customers’
behavior beyond the yearly contract signing touch point. TRI's partnership with Los Angeles-based blockchain
platform company Gem is an innovative approach to
usage-based insurance (UBI), something that the upcoming parts of this series
will be covering in more depth.
providers can collect and process distress calls in real
time from vehicle sensors and automated alerts, optimizing the dispatching of rescue
vehicles and analyzing accident and breakdown data to provide valuable
information to car OEMs and road infrastructure operators. Infrastructure
operators, including billing/toll road operators and recharging/refueling
players, are analyzing car data to optimize the geographic deployment of their
respective services, explore variable-pricing options and monitor the status of
their assets to reduce maintenance costs and improve safety.
High-tech giants are positioned to provide the
fundamental car data analytics services that car OEMs and advertisers are
willing to buy. In addition to being the IT backbone, they can offer front-end
applications. Moreover, as the car is a central environment for digitization, multiple
high-tech giants are developing in-car platforms and operating systems to boost
the data generation and provide seamless connectivity experience across
handhelds, vehicles and other connected environments, even homes.
Startups are the smaller counterparts of the high-tech giants, entering
the car data monetization space from a variety of angles, such as developing
new apps, engineering innovative hardware/interfaces (e.g., retrofittable,
gesture-activated controls) and offering services through innovative
monetization schemes (as, for example, Pandora and Spotify did for
Service providers offer data management services such as analytics,
pseudonymization and storage and operate the back-end infrastructure and
processes for the players in the ecosystem. Mobility providers already rely on
car data to be able to offer their services such as car sharing and e-hailing.
They use the power of car data to further approximate public transportation
infrastructures and improve vehicle allocation, recharge and fleet operations.
Retailers and service
centers are using car data analytics to optimize their
sales networks and get the messages about their offerings directly to drivers.
For example, by purchasing traffic flow data, retailers can define with greater
precision their stores’ footprint (the number, type and location of stores) and
their inventory on the basis of actual traffic data, even segmenting the type
of end customer actually driving in front of the store. Assuming they obtain
customers’ clearance, they could push highly-tailored advertising to car
screens and drivers’ handheld devices on the basis of proximity and customer
Regulators and government
institutions are setting the standards regarding the
collection and sharing of car data. They are also in a position to mandate car
data-enabled services that support the public good, such as emergency call
features, and regulate controversial topics, such as technical certification of
the connected vehicles, data ownership rights and intellectual property rights
over shared technologies and services. Working with infrastructure operators on
big data, regulators can also seek to minimize congestion and reduce car
accidents using traffic flow data analysis.
The “Driving the
Future of Blockchains” series is presented by Gem, a sponsor of
Distributed.com. Read a preview of the series here and part one here.