The consumer and commercial telematics revenue size will reach nearly $20 billion by 2018, said Juniper Research.

Telematics revenue will include soft revenues from areas such as car servicing, Big Data enabled by telematics, and enhanced customer service.

The report said soft revenues will form a key part of the future Connected Cars market as they will allow automotive manufacturers to generate revenues throughout the lifetime of the vehicle, rather than just at the point of sale.

Soft revenues will remain a major untapped revenue source for the consumer telematics industry, the report said.

SIM mandation will drive new revenue streams

Regulation in key markets, especially in Europe and Latin America, will mandate the inclusion of SIMs in all new vehicles allowing OEMs to develop revenue streams around the embedded SIM model.

Split billing will also become increasingly important. The ability to split the telematics bill, pioneered by major operators and systems integrators will have a positive impact on the telematics market. Granular billing for infotainment and other services will lead to new business models.

App integration into the vehicle through smartphone-tethering and direct integration into the head-unit will be accelerated by the launch of services like Apple’s in-vehicle offering CarPlay. In-vehicle apps will become widespread in the next five years, even though most apps will be available free of charge.

Smartphone-tethering and in-vehicle Apps will drive down the price of vehicle manufacturers’ own embedded infotainment services.

The use of LTE is expanding in developed markets for telematics and infotainment, particularly in North America and Europe, despite a higher module cost.

TelecomLead News Team