BTC Inc
by Jill Richmond, Jul 06, 2017

Driving the Future of Blockchains Part Two: The New Mobility Ecosystem


Gem Auto 2

Cars now generate data about how they are used, where they are and who is behind the wheel.

With greater proliferation of shared mobility, progress in powertrain electrification, car autonomy and vehicle connectivity, the amount of data from vehicles will grow exponentially, raising a key question: How might industry players in the evolving automotive ecosystem turn car-generated data into valuable products and services? More importantly, where does the architecture lie to permission and secure that data? 

With those questions in mind, the opportunity for industry players hinges on their ability to:

  1. Quickly build and test data-driven products and services focused on appealing customer propositions.
  2. 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.

Driving Action

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 moonshots.

Pole Position

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.

Roadside assistance 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 music-related content).

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 preferences.

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.

You might also like

How Blockchains Can Influence the Influencers

Christopher Tozzi

Contributing Writer

UPS Steers Into Blockchain Trucking Alliance

Michael Scott

Contributing Writer