IoT services are becoming crucial for both automotive enterprises and consumers. As the automotive industry shifts from a product-centric to service-centric business model, the connected car will function as a platform for various services. However, security is the main challenge to overcome as vehicles become more connected. Standards must be developed to securely interface connected vehicles while maintaining privacy. This transition allows automakers to develop continuous customer relationships beyond the point of sale.

1. Prepared by Helene Andre, Business Development & Marketing
For PRIME Paris Region International Mission Enterprise
June 2015
IoT Services
in the Automotive Sector

2. IoT Services in the Automotive Sector - Agenda
IoT Services Become Crucial For Both Enterprises & Consumers
From Product-Centric to Service-Centric Business Model
The Car as a Platform of Services…Changing The Automotive Ecosystem
Toward a Broad Array of Services
Security As The Main Challenge To Overcome
Building interfaces & security standards for the Connected Car
Toward a Continuous Customer Relationship

3. IoT Services Become Crucial For Both Enterprises & Consumers
For Enterprises
Services derived from the connected devices will drive IoT revenues
IoT Business revenues in 2020 : $300 Billion  90% from software & services
For Consumers
These services will provide awareness, knowledge & actions on their surroundings
Ultimate answer to their need of cost-effective & tailored solutions
Products to be designed as Connected Platforms of Services
Gartner, Press Release, December 2013

4. From Product-Centric to Service-Centric Business Model
Product
One-time product sales
After-sales service
Shift in Value Creation
Companies need to create and capture value differently
Experience
Recurring revenues
Continuous customer relationship
HBR, How the Internet of Things Changes Business Models, July 2014

5. The Car as a Platform of Services…
90%
40%
10%
40%
20%
23M
Connected vehicles
2015 2020
152M
Connected vehicles
The car becomes a platform of services connected to the city, to
companies and to other vehicles
hardware contentsoftware
IHS, Emerging Technologies: Big Data in the Connected Car, Nov 2013
Morgan Stanley, Self-Driving the New Auto Industry Paradigm, Nov 2013

6. …Disrupting The Automotive Ecosystem
The IoT-enabled car is a hub for an entire ecosystem of connected
services provided by various players for various players
Drivers & Passengers
Car Makers, OEMs & Traditional
suppliers
GM, VW, Renault-Nissan, Valeo, Delphi,
Faurecia…
Third-party suppliers & Content
producers
Garmin, Apple, Netflix, Google, Comcast

7. Toward a Broad Array of Services
CB Insights, June 2015

8. Toward a Broad Array of Services
4G LTE
Smartphone
Infotainment Safety &
Security
Usage-based
insurance
Data
Management
Over-the-air
updates
Business Insider, March 2015

9. Toward a Broad Array of Services
Infotainment Safety &
Security
Usage-based
insurance
Data
Management
Over-the-air
updates
Business Insider, March 2015
AT&T Mobility is currently emerging as a leader in infotainment in the USA. The
carrier has secured Tesla, Subaru. AT&T has made it easy for the customers to use AT&T
with their car by allowing AT&T-equipped cars to work inside AT&T's shared data plans.
There’s room for more carriers but also for content producers to gain ground in the car
space. According to Business Insider, 25% of global consumers would be willing to receive
in-car advertising if it meant they got free basic services in exchange.
Google is developing a version of its Android software that would be built directly
into the consoles of cars. Such a move could obviate the need to have a smartphone
connected to the car's infotainment system.

10. Toward a Broad Array of Services
V2V
V2I
OBD-II plugin
Infotainment Safety &
Security
Usage-based
insurance
Data
Management
Over-the-air
updates

11. Toward a Broad Array of Services
Infotainment Safety &
Security
Usage-based
insurance
Data
Management
Over-the-air
updates
There are services that can be preinstalled by the car manufacturer like
Volkswagen’s Car-Net which can automatically alert emergency services when an accident
has occurred. These services can also be provided by additional devices. The Automatic car
adapter can alert Automatic’s call center to send emergency services to the location of the
crash and notify emergency contacts.
Beyond emergencies, Garmin launched Garmin Traffic–a subscription add-on to
their GPS devices that helps drivers avoid traffic and other delays in real-time. Traffic alerts
come from a traffic data collection system that analyzes traffic flow data collected from
millions of Garmin device owners, cellphone owners, incident reports, fixed traffic sensors
on major roads…

12. Toward a Broad Array of Services
OBD-II plugin
Bluetooth
Smartphone
Infotainment Safety &
Security
Usage-based
insurance
Data
Management
Over-the-air
updates

13. Toward a Broad Array of Services
Infotainment Safety &
Security
Usage-based
insurance
Data
Management
Over-the-air
updates
Connected cars, and soon autonomous cars, are expected to bring accident rates
down. It is an incentive for insurers to develop usage-based insurance instead of relying on
premium income. Insurers now have to tailor their product offerings with historical and
real-time data about customers’ behavior. Like Allstate and its Drivewise program that
collects data every time customers drive their vehicle and that rewards safe drivers.
Big data analytics can help insurers monitor how their customers drive. But
incumbents may be too slow to catch up with startups like Metromile and big data kings
like Google. Metromile offers per-mile car insurance and is already attracting low-mileage
drivers. Additionally, carmakers may choose not to share the data they collect and rather
use it to bundle their own policies in with their vehicles. That’s what BMW has hinted at.

14. Toward a Broad Array of Services
SIM card
4G / LTE
Infotainment Safety &
Security
Usage-based
insurance
Data
Management
Over-the-air
updates

15. Toward a Broad Array of Services
Infotainment Safety &
Security
Usage-based
insurance
Data
Management
Over-the-air
updates
Over the air updates enable to keep contact with the vehicle while skipping the visit
to a dealership.
Tesla is better positioned than most automakers to offer OTA software upgrades,
particularly major ones that affect the powertrain and not just the infotainment or
navigation system. This is because all of the Model S's electronic control units (ECUs) can be
centrally accessed as part of the vehicle's telematics system. On most vehicles, there are
hard firewalls between ECUs that serve navigation systems, entertainment units and
powertrains to avoid hacking and protect IP.
But Tesla is not alone, Mercedes has partnered with Verizon to develop and offer Mbrace2
to its drivers.

16. Toward a Broad Array of Services
Infotainment Safety &
Security
Usage-based
insurance
Data
Management
OBD-II plugin
Bluetooth & Smartphone
GPS & Radio
Over-the-air
updates
TechCrunch, January 2015

17. Toward a Broad Array of Services
Infotainment Safety &
Security
Usage-based
insurance
Data
Management
Over-the-air
updates
TechCrunch, January 2015
Airbiquity is a platform of services that goes from collecting to analyzing data. It links
the vehicle to Airbiquity cloud via mobile or embedded device. Airbiquity then delivers
smartphone apps, cloud content, and services through the vehicle head unit with the
driver’s smartphone. Airbiquity raised a bit more than $35 million.
Mojio connect cars to the cloud via its OBDII plugin devices. Mojio includes built-in
connectivity and a GPS in its unit (Vs. Bluetooth and smartphone). It uploads hundreds of
data points about the car every minute, tracking everything from the brakes to the locks.
Everything is available for developers on Mojio’s open source platform. It then uses these
data points to provide connected car services in partnership with apps like Concur to
measure gas mileage and Glympse for GPS tracking.

18. Next opportunities
Security As The Main Challenge To
Overcome
Building interfaces & security
standards for the Connected Car
Continuous Customer Relationship
+ IoT services in the automotive sector

19. Security As The Main Challenge To Overcome
Securing both hardware and software in the car against hacking
Central telematics systems Vs. Closed circuits
Many embedded systems that have not been designed to be connected to the outside
world, are wired to other systems more vulnerable.
So, how should mission critical software be wired to other software in the vehicle to
ensure both security and efficient updates? Some will advocate in favor of privacy by
design creating closed circuits, while others will be less conservative and will design
central telematics systems
IHS, Emerging Technologies: Big Data in the Connected Car, Nov 2013
Morgan Stanley, Self-Driving the New Auto Industry Paradigm, Nov 2013

20. Building interfaces & security standards for the Connected Car
Self-regulating industry approach to solve privacy & connectivity issues
Most car manufacturers and OEMs believe that there is strength in unity.
British Telecom has announced the launch of an ethical hacking service: a new
security service developed to test the exposure of connected vehicles to cyber-
attacks. The objective is to include suppliers, IT security specialists and certification
bodies to build the security standards of tomorrow.
IHS, Emerging Technologies: Big Data in the Connected Car, Nov 2013
Morgan Stanley, Self-Driving the New Auto Industry Paradigm, Nov 2013

21. Toward a Continuous Customer Relationship
It is a perfect opportunity to create more
value and to enhance brand loyalty.
Service providers are encouraged to explore
open platforms for the production of apps
that bring innovation to all users: drivers,
OEMs and all the automotive players.
In terms of value creation, services are becoming far more important than
hardware. In this new paradigm, customer relationship goes far beyond the
sale.

22. Sources
gartner.com/newsroom/id/2636073
hbr.org/2014/07/how-the-internet-of-things-changes-business-models
business.time.com/2014/01/07/your-car-is-about-to-get-smarter-than-you-are/
forbes.com/sites/eliseackerman/2014/12/11/freescale-talks-about-its-sweet-spot-the-growing-market-
for-connected-cars/
businessinsider.com/connected-car-is-next-digital-platform-2015-2#ixzz3WqCnR29M
techcrunch.com/2015/01/31/how-connected-cars-have-established-a-new-ecosystem-powered-by-iot/
wired.com/2015/05/feds-say-banned-researcher-commandeered-plane/
marketwatch.com/story/bt-launches-ethical-hacking-service-to-enhance-the-security-of-connected-cars-
2015-04-20

23. About PRIME & French Tech Hub
PRIME is a transatlantic innovation platform
promoting the Paris region as a center of innovation
and engaging in activities to encourage and
incentivize American companies and organizations
to invest in the Paris region.
PRIME is a subsidiary of Paris Region Entreprises.
French Tech Hub serves as the U.S. Hub for
entrepreneurial and innovative French companies.
We provide custom-tailored services to help our
clients strategize, launch, expand, and achieve their
business potential.
For more info,
Contact Olivier Allegret
Olivier.allegret@parisregionentreprises.org
For more info,
Contact Marie Buhot-Launay
marie.buhotlaunay@frenchtechhub.com