Telematics – Market Growth Prospects

Market Growth

Telematics is a multifaceted field that comprises of telecommunications, vehicle technologies, road transportation and road safety. It is designed to improve vehicle performance by using progressive technology, which offers better services through innovation. Ernst & Young have reported, that there will be rapid growth of the global telematics market, with approximately 104 million new cars expected to have some form of connectivity by 2025. As such, most operators are focusing on broadening their scope of capabilities, by addressing other roles outside of connectivity and further into the realm of IoT.

Mobile operators are generally bound to their native country and to even bigger players in the industry, which may put constraints on their growth potential. Telematics consists of many players, and as such, it becomes increasingly difficult to formulate a seamless network of partnerships to ensure the efficiency of services between operators and other service providers. Connected car and telematics contribute to market growth and more progressive dialogue between operators and the automotive industry. Building stronger, lasting partnerships in this specialized market, will help operators capitalize on the full value of the IoT revenue chain.

Fleet management to enhance safety

Safety for vehicles remains a fundamental priority. This may include anything from GPS navigation, automatic driving assistance systems to emergency warning systems (sensors).

Road safety is a significant public health issue all over the world with the average number of deaths reaching 1.35 million, annually. As such, monitoring drivers’ behavior has been a positive aspect of technological development for improving road safety. Research has discovered that young drivers are the most negligent – with drivers aged 16-19 years, 6 to 8 times more likely to crash than those aged between 55-59 years. Driver behavior can include monitoring erratic or aggressive behavior to support accident prevention. It is a core aspect of fleet management to ensure that technology is used for the greater good of our transport ecosystem.

In-vehicle connectivity

The connectivity of vehicles presents both challenges and opportunities. Data is usually collected as valuable information to enhance safety features such as a remote unlocking system – to access a vehicle when keys have been lost. Proactive vehicle maintenance and remote diagnostics can monitor engine performance and can provide vital information to technicians, who can assess the problem of a car much more efficiently. Fast real-time data can be shared for efficient monitoring and maintenance – such as, when a driver is in need of remote assistance whilst on the road. However, such a wealth of data exchange can mean increased vulnerability to cyber-attacks and data breaches, which would require stringent data protection regulation.

Areas for growth

Telematics-based insurance is an area for substantial growth. This form of insurance would be adopted to accurately assess and evaluate automotive damages and reduce driving data fraud. An active telematics insurance policy would comprise of a box that contains a SIM card, which is installed by the insurance company into the vehicle. Using the information that is transmitted by the box, the insurance company can use that data to evaluate driver behavior, which may or may have not contributed to an accident claim. This may also help reduce the overwhelming number of fraudulent claims. The development of insurance coverage will provide useful information on road behavior as well as help individuals improve their driving habits, based on the review of their records. The evolving paradigm shift will benefit the larger ecosystem in relation to crime prevention, road safety and driving skills.

Telematics – a global incentive

Essentially, telematics allows for a fully-integrated design response chain, which provides the most efficient, high-tech method of response in an incident. Such a seamless flow of data collection and transmission, calls for the openness of the tech and operator ecosystem to co-operate in order for this multifaceted, heterogenous system to be standardized across the globe.

References:

Warren, I., Meads, A., Whittaker, R., Dobson, R., & Ameratunga, S. (2018). Behavior change for youth drivers: design and development of a smartphone-based app (BackPocketDriver). JMIR formative research2(2), e25.