US connected-car numbers to double over next three years: Parks Associates

Some 47% of all new vehicles sold in the US will have embedded cellular modules by 2017, representing a doubling in subscriber numbers over the 2013–16 period, according to new research from Parks Associates.

In a new report examining the growth opportunities in the M2M industry, the market-research company also says that around 17.6 million consumers will subscriber to embedded connected vehicle services such as General Motors’ (Detroit, MI, USA) OnStar and Chrysler’s (Auburn Hills, MI, USA) UConnect Access.

Some 47% of all new vehicles sold in the US will have embedded cellular modules by 2017, representing a doubling in subscriber numbers over the 2013–16 period, according to new research from Parks Associates.

In a new report examining the growth opportunities in the M2M industry, the market-research company also says that around 17.6 million consumers will subscriber to embedded connected vehicle services such as General Motors’ (Detroit, MI, USA) OnStar and Chrysler’s (Auburn Hills, MI, USA) UConnect Access.

“Mobile network operators (MNOs) such as Verizon [New York City, NY, USA], AT&T [Dallas, TX, USA), and T-Mobile (Bellevue, WA, USA) see M2M as a way to diversify their revenues and secure a strong foothold in this early market, particularly in the auto industry,” said Jennifer Kent, an analyst with Parks Associates.

“MNOs can leverage their relationships with module manufacturers, app developers and consumers to provide auto OEMs with valuable integration services, thereby generating service revenues on top of network access fees,” she added.

Although OnStar was launched in 1996, carmakers like Ford (Dearborn, MI, USA) and Nissan (Yokohama, Japan) have been relying on smartphones for many of the connected services they provide.

According to Parks Associates, however, those companies are now introducing embedded modules in electric cars to provide core assistance and navigation services, including performance and diagnostics information and remote control of vehicle locking and temperature.

Outside North America, the connected-cars market has also received a boost from recent deals involving Deutsche Telekom (Bonn, Germany), BMW (Munich, Germay) and Daimler (Stuttgart, Germany).

The German operator is to provide connectivity services in BMW vehicles available from Sixt (Pullach, Germany), Germany’s largest car-rentals company, and will also equip cars from Daimler with communications technology.

“The M2M market for consumers has seen steady growth over the past decade and is shaping up for a bright future,” said Kent. “Declining sensor and networking costs, increased interest from MNOs, expanding use cases, and new business models are converging to drive the M2M industry forward.”

Kent says industry players are now pushing beyond the proprietary nature of M2M to establish new business models that enable interoperability and scalability.