The Smart, Driverless Car Race Accelerates
Another week, another few billion dollars being invested in developing the connected, autonomous “car of the future.”
This week’s deals — Intel’s $15 billion acquisition of car camera, mapping, and data provider Mobileye, which was preceded by Samsung’s estimated $8 billion purchase of Harman — highlight the veritable Gold Rush to be the primary platform that powers the Internet of Things from wearables to the connected home to the smart, driverless automotive vehicle.
Stepping Up Investments In Connected ‘Things’
After Uber and Google stepped up investments in autonomous cars, traditional car companies and electronics manufacturers reacted quickly to form alliances and stakes in companies to ensure that they don’t get left behind.
For most consumers, the idea of a driverless car still seems like science fiction — and along with the uncertainty of buying wearables, it’s not clear that people are clamoring for a virtual chauffeur.
Nevertheless, as the technological hurdles are being dealt with on the road to the driverless car, a variety of major automotive manufacturers, electronics companies, and tech platforms appear all in on the idea of “if you build it, they will come.”
To be sure, the notion of the connected car and connected home has captured consumers’ imagination. As the past has shown with smartphones and voice activated digital assistants like Alexa, that’s the first step to entering the mainstream.
It’s All About The Data
If the optimistic forecasts for the connected car are even close to being correct, these vehicles will result in an expansion in the generation of data unlike anything we’ve seen in the history of the internet thusfar.
In heralding the purchase of Mobileye, Intel itself said it expects that by 2020, autonomous vehicles will generate 4,000 GB of data per day. The companies that help power and analyze that data stand to enjoy a new level of tech leadership (not to mention profits).
In a sharp analysis of why Intel appeared to overpay for Mobileye, Marc Pioleau, the location tech veteran who left Uber to join Mapbox last month, notes that with this deal, “Intel just bought direct access into the car.”
Prioleau continues: “With direct access to the car comes Intel’s ability to start generating recurring revenue with data as a service for semi-autonomous driving. This is exactly what ARM, NVIDIA, and Qualcomm will need to do (along with anyone else looking transition to from selling hardware).”
At first glance, Israel-based Mobileye would seem fairly unnecessary to Intel’s existing ambitions in the smart car space, especially considering its recent 15 percent stake in mapping platform HERE.
What made Mobileye attractive, even crucial to Intel was its development of its Road Experience Management software, which the company bills as an “an end-to-end mapping and localization engine.”
“This is the function that would understand the ever-changing roadside environment and allows ‘localization’ or positioning of a vehicle within that roadside environment,” Prioleau writes. “They announced plans to begin collecting data with 2M cars on the road in late 2018… In the future, new cameras will be connected and will act as crowd-sourced sensors that can capture information and feed that back into a continuously updating map called the Roadbook.”
Interestingly, Mobileye and HERE began collaborating on REM and the crowd- and sensor-based Roadbook, which records and updates places of interest as well as identifies lanes, exits, and other features that provide the full view of streets and highways, in December.
“The sensors alone let the car know where it is on the road, but the car has no idea where it’s going, you still need a map,” Prioleau says. “Once Mobileye has data for the Roadbook it can then joined to various map providers. A live updating map is core to autonomous and semi-autonomous driving, and that’s what Intel is paying for.”
The Roadmap Ahead For Autonomous Cars
The same need to capture and manage data for location and mapping the road for driverless and connected cars was what drove Samsung’s acquisition of Harman as well.
Even more than Intel needs to reinvent itself from being viewed as being a chipmaker for the declining personal computer business, Samsung is anxious to show it has more going on than bad headlines from the the Galaxy 7 Note device recall to its executive scandals.
Like the initially curious Intel acquisition of Mobileye, Harman’s connection to the future of driving also seemed like a headscratcher. After all, Harman is primarily recognized for its high-end audio equipment.
But much as Mobileye has sought to expand its capabilities, Harman brings Intel two important things to the table: it has extensive ties to General Motors and Tesla. Secondly, Harman has 8,000 software designers and engineers working on cloud-based software for the automotive market, the companies boasted last November, when the deal was first announced.
“The vehicle of tomorrow will be transformed by smart technology and connectivity in the same way that simple feature phones have become sophisticated smart devices over the past decade,” said Young Sohn, President and Chief Strategy Officer of Samsung Electronics last year. “We see substantial long-term growth opportunities in the auto technology market as demand for Samsung’s specialized electronic components and solutions continues to grow. Working together, we are confident that HARMAN can become a new kind of Tier 1 provider to the OEMs by delivering end-to-end solutions across the connected ecosystem.”
The competitive advantages will tilt toward legacy tech companies or the relative newcomers will play out over the next five years, since this is only the start to the race for the connected car.
via GeoMarketing
