Andrew Till works for Harman's Connected Service division, focusing on new emerging technology trends and defining new areas that the company can move into in the future. Over nine years at the software specialist, which has recently been acquired by Samsung, he has seen great change in the automotive industry which is becoming further entangled within the emerging mobility sector. The most significant change, he tells me, is the perception from established automakers around the world: “Every company is in a transition to become a technology and software business. Five years ago, I would say this to OEMs and they would look at me in disbelief. What they are realising now, is that the technology - particularly the software - is a transformative element in the user experience,” says Till. “When you look at the new players like Tesla, they have come in with a different design methodology. The fact that they had never built a car was not their Achilles heel that everybody spoke about, but their advantage.” This is similar to the likes of Google bringing Android into the automotive world and looking at it from a wider perspective. People are using technology at home and on the move, and software companies are trying to continue this within the car, understanding the overwhelming potential of the expanding market.
If you look at carmakers like BMW and Mercedes, they are not just automotive companies but also lifestyle brands. They have the potential to move into many markets but each time you move into a new space, you typically have to embrace a new business model. New entrant automakers, which Till calls “tier two OEMs,” are coming from markets from countries like China and, although they do not have the iconic brand status of long-established automakers, are focused on connected services and a fresh perspective that customers are now demanding. “These players are picking up platforms like Android and it is not clear if they are doing that out of strategic direction or because these platforms are available and essentially free to their software development pool of engineers. They pick up these service-based business models, unlike many traditional automakers who are still trying to figure out exactly how they will redefine their own value chain,” adds Till.
On top of this, through the new world of autonomous cars and mobility services, businesses will need to understand who actually owns the vehicle and how they will work alongside city strategies and governments. “You have a transformed experience where people are no longer driving and the potential to sell someone a service is much higher,” says Till. “We are starting to see a number of different service models, certainly the concept of selling content and services, being embraced. For example, if you take the driver profile out into the cloud, a business can allow customers to request a car on demand and get it set up for them before they receive it.” This is an innovative service model based on high levels of customisation and personalisation. Data generated off vehicles is no longer just of interest to the car manufacturer, but it is now incredibly interesting to a range of companies who are planning services to identify how customers are adapting to the new market, be it navigation, emergency services or infotainment. Till tells me that these types of scenarios become a lot more challenging as data is shared from the vehicle to someone else, which is not something the automotive world has traditionally been happy about doing. “This is understandable, but I think we are now at the point where data services and back-end platforms can support these new business models as and when companies are ready to embrace them.”
Traditional skills found inside the automotive industry are not typically cloud-based, which is now playing a strong role moving forwards with the connected car. This has caused an influx of partnerships in the industry, fuelled by more software-based companies coming into the automotive and transport sector to play specific parts of the value chain with unique skills and capabilities. “From an OEM's perspective, the future is based around collaboration, where they will bring the vision of the driving experience and interaction with the outside world, but will need someone else to specify the mobility,” comments Till. A fully integrated future requires not only that companies bring these experiences into the vehicle, but the vehicle experience out into the entire ecosystem, which again highlights the importance of collaborating with other industries to benefit customers.
Although it is important for automotive brands to keep up to date with these innovations, they must ensure that they do not create stress for customers with an influx of advanced technology. By throwing everything they have at customers, automakers run the risk of over-complicating processes that could add to the daily stress. By utilising technology to benefit society, consumers will appreciate new innovations that support them through their commute to work or when they take their family out on the weekend. Till agrees, affirming that “we need these relationships to be in place, but we have to take a user-centric view of removing friction from people's lives and make it a much more enjoyable experience from start to finish. Through this, there will be a greater affinity between the brand owner and customer.” Once again, this is why it is so important to look outside of the automotive industry, looking at the best ways of approaching this shift.
A leading from other industries that have gone through this type of changes is that, unless you do have those levels of cooperation, it is very challenging to understand all of the behaviour models and the use cases that will impact and shape your customer expectations. This is what is driving most of the partnerships that we now see being formed.
Unlike consumer electronics, the challenge with cyber security for many OEMs is that they are used to thinking about the mechanical aspects of the vehicle. Now that the industry is moving into end-to-end connectivity, cybersecurity has become a serious problem in the early stages of development. Vehicle security runs from the vehicle, across a network and out into the cloud, along with third party contributions which automakers have to make sure are all secure. Till explains that “it is no longer just about looking at your environment, but about the security within the car and working with partners to make sure that the entire end-to-end value chain is fully secure.”
Even if these companies focus on cyber security, most still do not have the appropriate knowledge to ensure complete safety to its customers. So, it is important that software specialists like Harman teach them about the Internet of Things (IoT). “There is an awful lot that you can learn from the IoT industry,” says Till. “We have been very hot on things like identity management so that a car understands that it is a car. If it is receiving instructions from an external party it should be able to question the request, preventing it from sending instructions. If what is being requested could compromise the behaviour of the vehicle, then it should cut off the connection.” In short, if you programme the vehicle to understand what it is, you can start to bring in local intelligence to know that if the vehicle receives a command that risks the safety of passengers, it can refuse the request. As soon as any security breach or glitch occurs in an autonomous car, it becomes front page news, even if the statistics show that it is far safer than a conventional car. “When you look at the statistics, new innovations around level 3 autonomous solutions run approximately 50% lower than the average number of miles per death on roads in normal vehicles,” Till adds. “Autonomous cars may be increasingly safer, but it becomes headline news every time something goes wrong.” This is understandable, as autonomous software is a completely new concept for society and challenges our concepts of trust between a person and a machine. However, this only pushes the argument that we need to move forward together, we need to develop secure networks and systems that protect the advance technology and we need to do all of this through a completely new perspective. Without an understanding of software, automakers cannot build the infrastructure needed to transform into a mobility business.