AI of Things (XII): OEM solutions for the connected car

Daniel García    15 November, 2022

We recently decided to renew our car at home by switching to a new one that is safer and more efficient. After the purchase process came the long awaited day of picking up our new car. When I sat in the car that afternoon and fiddled with the car’s settings, the section that caught my attention was the “Connected Services” section.

After activating them, which involved installing an app on my phone and giving permission several times in the car to share my data… BAM! I was in control of my car from my phone. I could see where I was, check my tyre pressures, check mechanical alerts and even unlock and lock the doors, all remotely.

This may seem like just another optional extra among the many accessories, but let me tell you, this changes the game. And it’s a reality.

What is telematics for or why should I connect my vehicle?

Fleet management services use telematics to monitor the use and status of fleet vehicles and optimise their use by improving fleet utilisation, safety and efficiency. This allows companies that market or use fleets to have better control of their fleets and greatly reduce operating costs.

Let’s take a practical case of a vehicle that is initially purchased by a renting or leasing company to rent it to other companies for 2-3 years and then resell it to a vehicle dealer who will sell it to the “end” customer for private use.

Telematics will give us confidence in the whole process. As the data is synchronised on the network, the possibilities of fraud or rogue traders are eliminated. It allows the leasing company to control that the use of the vehicle is in accordance with the contract. It allows the end customer to know that the vehicle he is buying really has the kilometres that it has.

Some other examples of how connected car generated data can be used to your benefit:

  • To contact emergency services in the event of an accident;
  • To “predict” when your vehicle will need maintenance or repair to avoid breakdowns;
  • To enable insurance companies to offer you tailored, or even lower, premiums (e.g. based on distance travelled, driving style and routes);
  • To provide “smart parking” information;
  • To automatically pay for parking or tolls;
  • To provide reliability on the condition and use of second-hand vehicles.
  • To advise you on the easiest and safest routes, avoiding traffic jams and road hazards;

The shift: from aftermarket device to OEM solutions

These services, which are many years old, have been based on “aftermarket” devices, which are purchased and installed in the vehicle using the OBD ports. The solution itself was part of the problem. The logistics of designing, manufacturing, installing and maintaining devices that work with the myriad of vehicles and manufacturers on the market are not insignificant.

As we discussed at the beginning of the article, vehicle manufacturers, known as OEMs (Original Equipment Manufacturers) are now starting to include telematics capabilities in their vehicles as standard from the factory, without the need to install any additional devices. This opens up a huge opportunity to deploy telematics services in both business (B2B) and consumer (B2C) environments that will allow us to improve all aspects of road communicatio.

The challenges: homogenisation and securitisation.

But it is not all so simple. While previously we had the challenge of integrating a hardware device with the different models and manufacturers of our fleet, we now have the challenge of integrating with the OEM telematics services that each of the different manufacturers provide, with different data, access and activation models. And at the same time it is critical to ensure that this information is shared in a secure, informed and authorised manner in line with data protection regulations.

As we can imagine this presents exciting challenges for the automotive industry, with two clear lines of work:

Photo: Chuttersnap / Unsplash
  • The first is to make data easily accessible, standardising both the platforms and the data itself and the quality of the data so that an application or service works the same on a SEAT, Renault or PSA vehicle.
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  • The second is to generate trust, both in users (data generators and holders) and consumers (companies or services that want to access them).

Let’s imagine a case of “Telematics Insurance” where “You pay as you drive”. Only if I, as a user, make an informed and active decision to share my data with my insurance company, they will have access to it in order to be able to discount my policy.

And on the insurance company’s side they need the assurance that other competing companies (including manufacturers) do not know they are accessing this data and cannot analyse how it is used to compete unfairly.

The European Automobile Manufacturers Association (ACEA) has published a position paper will be of interest to anyone who wants to go deeper into this issue and which introduces a concept that aims to solve this problem.

The “Neutral Server” concept

The Neutral Server initiative, which was announced at the end of 2016, is sponsored by the European Automobile Manufacturers Association (ACEA) with support from the European Union and other relevant industry players, proposes a solution that makes vehicle data securely available to service providers:

What is a Vehicle Data Neutral Server?

A Neutral server is an infrastructure that allows service providers to access vehicle data without having to sign a contract with vehicle manufacturers.

These servers are completely “neutral”, meaning that they are not operated or funded by the manufacturers, but by an independent party. Of course, these neutral server operators are obliged to apply state-of-the-art security and data protection measures.

Neutral servers also guarantee customer choice. With a neutral server, vehicle users are free to obtain services from the vehicle manufacturer, its network of authorised repair shops or any other service provider of their choice.

Similarly, the neutral server facilitates access to data, particularly for small and medium-sized companies, by offering them access to multi-brand data on a single server, rather than forcing them to use multiple servers from different manufacturers.

Photo: Markus Winkler / Unsplash

Given the potential of this type of infrastructure, there are multiple companies and initiatives working to capture a part of the business: IBM, Otonomo, Wejo are some of the contenders in a market that is opening up right now.

A doorway to the future of connected car

Once these aspects have been solved, in the medium term, the OEM means the democratisation and standardisation of telematic data and the services that rely on them. An explosion of these services is expected in the coming years, both in business (B2B) and consumer (B2C) environments. 

The most obvious area is autonomous driving. Higher levels of vehicle autonomy, covering autonomous driving, depend on more vehicles becoming increasingly connected, exchanging real-time information wirelessly with other vehicles, with road users, with infrastructure and with third-party service providers.

Telefónica Tech and the OEM

Telefonica Tech has been working for some time with our vehicle solution partners to incorporate OEM telematics into our service portfolio. Some of our customers are already starting to deploy Fleet Management solutions more quickly and cost-effectively by eliminating the need to purchase and install a third party device. 

We are also working with some of the major players in the industry to develop and exploit the server-neutral concept.

And of course on our side we are developing and deploying the critical infrastructure that, like 5G networks with their lower latency, are critical to enable the advanced use cases we have discussed.

🔵 More content on IoT and Artificial Intelligence can be found in other articles in our series – the first article of which can be found here,

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