Time For A Software Update On Your Car, Not Your Phone

Abhijit Sengupta Feb 03, 2022

Automobiles are no longer mechanical devices. Instead, they are ‘computers-on-wheels’ running millions of lines of codes, evolving into software-driven transportation platforms. Original Equipment Manufacturers (OEMs) are leveraging in-vehicle software and technologies such as Advanced Driver Assistant Systems (ADAS), connected services, and infotainment systems to improve driver’s safety and the overall driving experience.

According to Allied Market Research, the global automotive software market was worth USD 18.5 billion in 2019 and is expected to grow to USD 43.5 billion by 2027. The potential of 5G and artificial intelligence (AI), as well as innovations in semi-autonomous and autonomous vehicles, and data monetization in the extended automotive ecosystem, will unlock new use cases and transform urban mobility.

The rise of software-defined vehicles

Traditionally, automotive OEMs strive to provide the best mechanical features such as horsepower and torque in vehicles. With the rise of software-defined automobiles, this dynamic is changing.

Consumers today are increasingly interested in features that are defined by software, such as autonomous driving features and a modern in-vehicle infotainment (IVI) system that connects with smart devices or sensors. This demand opens up a slew of touchpoints in the form of periodic software upgrades to correct bugs, enhance vehicle performance, address vulnerabilities that could compromise security, and allow hackers to gain access or control to a vehicle software, or to add new services.

Rather than focusing on hardware, OEMs are increasingly looking at new business lines or revising bill-of-materials efficacies specified by software functionalities for future models. With connected vehicles bringing in more data than ever, manufacturers can now analyse those data to discover manufacturing flaws, address reliability concerns that may be re-engineered and rectified in future models to improve their offerings to consumers.

For example, VinFast, a leading Vietnamese premium automobile manufacturer recently announced that its first three electric vehicle models will feature location-embedded software development kits (SDKs) in conjunction with its mobile app to give a smart in-vehicle navigation experience. Drivers will be advised about charging stops on existing routes as well as unforeseen re-routes using multi-stop route planning.

Throughout the VinFast’s vehicle’s lifecycle, the firm will employ the navigation-as-a-service strategy to simplify the infotainment supply chain and development process while adding new services to its navigation capabilities. This will not only save the company money but also enable it to scale rapidly, offering a one-of-a-kind IVI system that sets it apart from its competition.

Connectivity influences the driving experience

As we transit from combustion vehicles to electric mobility, we will see customers prioritizing in-vehicle experiences, driven by fingerprint sensors, touch controlled navigation system, equipped with voice controls and AI.

Just like how we receive regular software updates on our smartphones, drivers will now receive in-vehicle notifications to prompt them to upgrade their vehicle software so they unlock updated features. With the aim to enhance driver’s safety, such software updates will enable drivers to receive alerts that the ADAS has a new capability to aid expressway driving or that their car’s range has been increased based on analysis of thousands of hours of battery cycles.

Real-time data can also be used to monitor vehicle performance, generate real-time traffic and road hazard alerts, instantaneously call for emergency assistance, and even anticipate mechanical problems before they occur.

Aside from safety, software-led technology is also redefining in-car leisure & entertainment. As 5G goes mainstream and the Metaverse dawns, the car will be a moving entertainment pod, beaming high-definition games, surround-sound movies, and new forms of multiplayer interactive elements tied to virtual reality technologies. Eventually, driving will become a safe and fun experience.

Future-proofing the business of mobility

The increasing shift to a software-defined automotive industry isn’t completely unchartered territory. There are parallels to be drawn between the evolution and growth of automobiles and smartphones. In the early 2000s, the battle of phones was dominated by hardware features. Each OEM competed over who had the flashiest feature. However, by separating hardware and software, smartphones altered this dynamic. Smartphone OEMs could now construct different operating systems and deliver upgrades over the air (OTA), while developers create new apps, focusing on software and services.

The automotive sector appears to be following suit, heading towards an all-connected future. This has a direct impact on companies who are partnering with automakers. Historically, automakers and parts suppliers have a vertical relationship, but this is weakening. Instead, car manufacturers are strengthening horizontal collaboration with technology and software companies. As a result, the automobile industry's growth will no longer rely on the quantity of vehicles they sell, but on connectivity-driven growth supported through strategic alliances.

Mobility is undergoing one of the most significant transformative, economic, social, and technological revolutions in a generation. It is being moulded by disruptive factors such as electrification, connectivity, and on-demand in-vehicle experiences. Those that can fully appreciate the impact and timing of disruption, as well as seize the correct emergent possibilities, will triumph.