Mobility Trend: Internet of Things

The Internet of Things (IoT), or should I say, the Monetization of Things (MoT)?

By the year 2020, 50 billion devices will be connected to the internet. And the car is well on its way to becoming the most sophisticated mobile device in IoT. According to Gartner, by 2020, there will be a quarter billion connected vehicles on the road, enabling new in-vehicle services and automated driving capabilities. When more and more cars are connected, what does it mean to the consumers and the automotive industry?

For the consumers, it’s all about the experience

According to a McKinsey survey, more than a quarter of the new-car buyers already prioritize connectivity over features such as engine power and fuel efficiency. People want to stay connected on the road and keep the similar experience when they are at home or at work. In the future, when the drivers are freed from driving by the autonomous cars, they will likely do more activities in the car. A seamless experience between home-car-work might become standard. Your FitBit may be able to talk to your car about your lack of sleep last night, and to ask your car to play soothing music for you on the road. Your fridge will send your car a list of grocery to buy tonight so your car can auto-route to the grocery on your way home to pick up the groceries from the auto-pick-up window at supermarket. When everything is connected, everything is possible.

For the auto industry, it’s all about monetization

When car is becoming part of a consumer’s personal assistant system (together with your iPhone, Fitbit, Nest, and Alexa, etc.), it opens so many more ways to monetize the IoT. Data plans and entertainment systems are only the beginning.

The graph below from McKinsey provides a very good categorization of data from cars, which will completely change the navigation, after-market, shared mobility and open the doors for E-commerce and advertising companies to capture the average 46 mins per day American spends on the road. Through data analytics, the car can predict your preferences, recognize your emotion, and mostly importantly make recommendations to you. Think about E-commerce in the car, targeted advertisement, and concierge services.

The Internet of Cars, or should I say, the Monetization of Connected Cars?