Intel invests in connected cars

Connected car technology is getting another boost, this time in the form of a hefty investment by the world's largest chipmaker, Intel. Earlier this year, the company announced several investments designed to spur innovation and product development of connected vehicles. Like this article? Sign up to receive our weekly news blasts here.

Among those investments: a new Automotive Innovation and Product Development Center, expansion of Intel Labs Interaction and Experience Research (IXR) in automotive, an academic outreach program and the establishment of the $100 million Intel Capital Connected Car Investment Fund.

According to ABI Research, the installed base of embedded and hybrid connected car systems is expected to grow from 45 million at the end of 2011 to 210 million in 2016.

Those systems can range from fully-embedded OEM systems like Onstar to factory-installed hybrid systems (Ford SYNC), Internet radio/smartphone solutions or aftermarket solutions for vehicle tracking, road use tracking or insurance applications.

"In today's mobile world, personal computing touches every part of consumers' daily lives while at home, at the office and on the road," says Intel president and CEO Paul Otellini. "By broadening our research efforts, academic and capital investments and opening the Automotive Innovation and Product Development Center, Intel is deepening its understanding of how people interact with their cars and how Intel innovations can enhance the automotive experience."

The product development center in Karlsruhe, Germany, will focus on development of technologies for in-vehicle infotainment and telematics solutions. Intel also announced plans for a comprehensive academic program that includes fundamental and applied research, curriculum development and internship programs. The program will be hosted at the Karlsruhe site.

Many flavors of connected vehicles According to ABI practice director Dominique Bonte, the company generally classifies connected car technology in four group: safety and security (like telematics solutions), infotainment (Internet radio streaming, connected navigation); cost saving applications (insurance) and convenience applications (concierge services, remote door lock controls, etc.).

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Across the globe, there could be a number of ways that connected vehicles are utilized. Some governments would like to establish road use charges that help reduce traffic congestion while making use taxes more fair, and connected vehicles would enable that type of tracking. Some insurance companies are also investigating ways to charge premiums based on actual miles driven and driver behavior; Progressive already has a system in place — called Snapshot — which does exactly that.

The biggest market, Bonte says, is in connected infotainment. Toyota's Entune and the Audi and TomTom in-dash navigation solution are good examples. In-car Wi-Fi networks are another key innovation, allowing drivers to use mobile devices in the vehicle. Integrating drivers' smart phones with vehicle systems will also be increasingly popular.

"Beyond that, we see additional applications," Bonte says. "Car sharing, for example. You use telematics to let people locate and open the car to use it. Car manufacturers can also contact customers to upsell them, send emails and establish an ongoing relationship that allows them to increase customer loyalty. There's no limit to how connectivity can be used in a vehicle."

As more technology enters the interior of the car, there is the danger of driver distraction. "The big fear is that exposing drivers to more information, especially things like Facebook or Twitter that can be distracting, could lead to accidents," Bonte says. "You see a whole range of solutions emerging so that drivers would, for example, only be allowed to access these applications when the vehicle is stationary."

But Bonte says that ABI believes that the increased level of distraction will be compensated for with more advanced levels of autonomous driving. "That's already starting to happen, where you have collision detection systems or lane departure warning systems that alert the driver to impending accidents or collisions," Bonte says. "By having these autonomous driving features, OEMs will move ahead with more entertainment in the car."

Google, for instance, already has several self- driving vehicles on the road in the U.S., and several OEMs have models on the road with collision avoidance systems.

As for the Intel investment, Bonte says that while their interest in the market is significant, the recent announcement of $100 million is a drop in the bucket compared to the potential size of the market. "Intel's goal is to have their chipset solution used by vehicle OEMs," Bonte says. "In that context, they want to help grow the industry, which is good. They want to help smaller companies to design solutions. But in the back of their minds they are trying to promote their platform. There are one billion cars in the world, and that is expected to grow to 3 or 4 billion.