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Internet of Everything Turns Automotive IT into Profit Engines

Andreas Mai, Director-Smart Connected Vehicles, Cisco

Andreas Mai, Director-Smart Connected Vehicles, Cisco

The Internet of Everything (IoE) will connect vehicles and other “things” with data, processes and people to the connected ecosystem. These four elements— data, process, people and things—transforms the automotive business model. “From building cars to selling travel time well spent.” Future differentiation will be driven by creating better driver, owner, and mobility experiences and ultimately turn our vehicles into smart assistants.

“Automakers need to integrate data analytics and monetization operation with traditional product and future mobility service value chains”

Connected Vehicle Value:

Cisco predicts that connecting vehicles on a unified communications network platform can help abate many of the personal and societal costs and create a yearly savings of more than $1,400 per each vehicle:

• $550 for vehicle owners by reducing operating and insurance costs.

• $420 by reducing the societal cost of crashes, congestion and pollution.

• $300 for the automotive industry, by reducing costs of warranty, service, remote diagnostics and prognostics, over-the-air updates, more data about what their customers want, and closer CRM—all enabled by connectivity.

• $160 created by the many startups that are emerging with new technologies and business models along the entire mobility value chain, for example car and ride sharing, insurance telematics, connected parking, location based services, interactive maps.

Mastering an Avalanche of “Big Data” is the Key to unlock this Value.

Automakers estimate data from vehicles to grow from 1.5 GB per month for the average connected vehicle to 300 GB for an autonomous vehicle. Analyzing and storing relevant data will heavily rely on cloud computing.

In addition, the future mobility value chain will go beyond what automakers currently offer.

It will integrate maintenance services, energy, usage based insurance, Internet connectivity, location based services, parking, traffic lights, road charging, car and ride sharing and also other modes of transportation. To deliver this broad range of services, automakers will need to connect their operations with and tap into the clouds of their ecosystem partners.

Automakers need to integrate data analytics and monetization operation with traditional product and future mobility service value chains. Collecting and analyzing data and triggering notifications for critical or immediate response requires a smart, secure, fast and scalable enterprise grade network technology. The selection of relevant data points from end devices rather than transferring full data sets, along with real time analysis, will be key to contain costs of data transport and timely actions on the results.

Fog—Fast and Relevant Data

For the analytics to be of value, many of these calculations must be performed in real time or close to where the results are needed. Therefore, the networks that will connect the vehicles will need to have more distributed intelligence to address the local computing, storage and low latency needs. Although cloud computing is part of the solution, the cloud must stretch closer to the vehicle. We refer to this distributed compute and storage power on the edge of networks as “Fog Computing.”

Big Data and Innovation

Big data is the fuel of connected vehicles. Advanced network technology is a critical component in turning big data into value. We are investing in all parts of the Big Data value chain as illustrated by some of our recent acquisitions, such as ThinkSmart for location data analysis using a Wi- Fi infrastructure and Truviso for data analysis. We also just announced Prime for Cloud and Systems Management, which delivers key network based Big Data functionalities to the market. Cisco’s Mulesoft based API management platform significantly facilitates the life cycle management of the ever-growing number of API’s. We recently acquired a software based policy engine called Broadhop, which will become a key part of the Big Data architecture as it automates key network processes. Some of these policy recommendations can then be more easily integrated into workflow engines, also from Cisco and also software based, to allow for end-to-end execution of resource provisioning needed to address the management of millions of connected vehicles and connected transportation at least in part running on virtual machines for efficiency and scale.

Over the next decade, nearly 300 million passenger vehicles, or 25 percent of the global vehicle population, will be connected to the Internet and transport more than 400 million gigabytes of data through mobile networks each month. By 2022, the transport of this data volume represents a market potential of more than $50 billion.

The Internet of Everything will help manage this data and bring new businesses models to fruition. We are looking at new applications and services, automation of processes, integration of databases, managed access and identities, all of which across enterprise boundaries.