Connectivity, App Stores and Cloud-based

Delivery Platforms

Future of European and North American Telematics and

Infotainment Market

June 2011

2

OEM Developed Apps are a Reality Now

Fiat, GM, Ford, BMW, Mercedes, VW all Join the Fray

OEM Developed Apps are a Reality Now

Fiat, GM, Ford, BMW, Mercedes, VW all Join the Fray

Brought-in Apps like Pandora going Standard

Toyota Entune Infotainment offers Multiple Apps

Brought-in Apps like Pandora going Standard

Toyota Entune Infotainment offers Multiple Apps

Terminal Mode Type Solutions are Ultra Critical NowNokia has established

partnerships with several OEMs

Terminal Mode Type Solutions are Ultra Critical NowNokia has established

partnerships with several OEMs

Touch Screens Important Feature Desired by

Consumers EU and NA consumer study

shows 80% consumers favoring

Touch Screens Important Feature Desired by

Consumers EU and NA consumer study

shows 80% consumers favoring

Tier 1 Suppliers are Actively Developing Next Generation

Infotainment StacksHarman Becker Single Largest

Tier 1 Suppliers are Actively Developing Next Generation

Infotainment StacksHarman Becker Single Largest

Global Trends and Highlights – OEMs are Using Apps as a New Medium to Reach to Consumers

EV Related Apps are a Common Trend Now

e.g. GM, Ford, Nissan, BMW all have convenience apps

EV Related Apps are a Common Trend Now

e.g. GM, Ford, Nissan, BMW all have convenience apps

3

OEMs have to address challenges associated with the integration of smart phones in car

Standardi-zation

Life cycle gap

User friendly

HMI

Liability

Driver Distraction

Safety Legislati

ons

Challenges

Source: Frost & Sullivan.

In-vehicle Infotainment Market: Challenges to OEMs (Europe & U.S.), 2010

M699-18

4

Internet in the Car: From an automakers perspective Brought-In method the most cost effective and way to bring internet radio into the car

Beamed - In

Brought - In

Built - In

These are head-units which are installed when the vehicle is assembled.

A dedicated SIM card built into the vehicle

Bluetooth is the primary method of data transfer from the portable device to the car speakers

These are portable devices such as mobile phone or music players. The mobile phone network is used for connectivity (tethering)

These are mobile phones used as a modem or have a USB modem

Connectivity is provided by tethering consumer mobile phone or having a modem in the car

BMW Connected Drive

Ford SYNC

Source: Frost & Sullivan

Smart drive kit for iphone + smart drive app

GM OnStar**

**OnStar has some safety features built in but a variety of media features are beamed in only on request

USB Modem

ClarionMIND Pioneer in-dash unit

Aftermarket

These are aftermarket head-units that provide access to internet with use of consumer mobile phone

5M653-18

Replicate Enable Provide

Most cost effective Most rich experience

Mobile phone based apps

Embedded Apps

Example: NOKIA Terminal Mode

Positives: Low Cost of Development for OEM, Design advanced interfaces which can easily access information from portable deviceNegatives: Loosing control of infotainment, Possible High level of distractionApprox implementation time 6 months after introduction of Terminal Mode Minimal source of Revenue

Example: Ford Sync, Fiat Blue&Me

Positives: Relatively low cost of development, allows consumers to associate with brand, provides connectivity of CE devicesNegatives: Is not always the best integrated solution, possible level of distraction

Approx implantation time 2 yearsPossible source of revenue include subscription to critical services

Example: Harman 3G Infotainment System,

Continental AutolinQ, InkaNet 3G, GENIVI

Positives: Safest and best way for integrated experience, strong association with brand, flexible system allows to upgrade and keep in line with technology Negatives: Cost associated is usually high, proprietary systems

Approx implementation time 5 yearsHigh source of revenue

OEM Roles – Currently Divided between Replicator and Enabler, AutolinQ might be the First full Provider

6

Simple CableSimple CableInterface Method

Functionality

BMW audio interface, USB cables and audio

cables.

Phone gets connected to car through a cable.

Only functionality available through simple

cable is accessing music from phone. It

allows hassle-free and easy connectivity, but

limits functionality.

Bluetooth Steering Wheel

Bluetooth Steering Wheel

Nokia Terminal Mode

Nokia Terminal Mode QNX iPod outQNX iPod out

Fiat Blue&Me technology, Bluetooth

car kits

Bluetooth in car pairs with Bluetooth-equipped cell phones and allows telephony, access to contacts and music using steering wheel

controls. It has wireless connectivity, but performs limited

functions.

Upcoming Nokia terminal mode

concept

Terminal mode connects phone to car through a

cable and allows all smartphone functions in

the car.

It gives blown up functions, but may cause distraction.

ipod out connectivity in BMW (Pandora)

Similar to terminal mode, QNX iPod out

currently allows music access in car through

ipods and iphone. Pandora Radio is the

first application in BMW.

Examples

Smartphone Interfacing Technologies

Standardizing the interface is the latest trend in the infotainment market

In-vehicle Infotainment Market: Description of Various Interface Technologies (Europe and North America), 2010

Source: Frost & Sullivan.

M699-18

7M5B6-18

Renault TomTom

Toyota Entune

Chevy MyLink

Entry Level Infotainment Solution

Offers voice, touch screen and central console control options

Easy to UpdateIntegrated dedicated SIM for LIVE services

Joint development by OEM and non automotive supplier

Integrated Infotainment SystemVoice and steering wheel controls based system

OnStar services platform integration

Addresses both entertainment and safety functionality

Connected services platform enable delivery of mobile applications and services safely and securely into the car

Voice, smartphone App controls and touch screen

OEM controlled app environment

Current Infotainment Approaches: More focus on developing intuitive HMI to provide access to smartphone and other portable devices

8

Cloud-based Deployment ModelsToyota and Ford are Pioneering Cloud-Based Research with Toyota Specifically Focusing on Creating a Complete Mobility Platform using Microsoft Azure Cloud Platform

• Google• Using Google

Prediction API to Increase Driving Efficiency

Ford

• Microsoft• Using Azure Cloud Platform to create a mobility platform for connected services

including services for EVs

Toyota

• Salesforce.com• Using Salesforce

chatter a private social network that

will connect car, dealerships and

Toyota

Toyota Friend

Using Google prediction API, Ford is trying to understand driving habits and apply predictive

analytics based on patterns to suggest optimized driving

routes, types to the driver (all cloud-

based)

Toyota and Microsoft have partnered to

create a Toyota Smart Center using

Microsoft Azure cloud platform to power next generation connected

services including services for the EV as well general mobility

related services

Partnership with Salesforce.com to

utilize its private social network to power a

connected communication

channel between car, driver, Toyota and

dealerships to enable vast variety of alerts

and services including critical ones for EVs

2012 Global Rollout2015 Full Scale

Deployment2012 Launch

9M6AO - 18

Cloud based

Partial Intelligence in Car Smartphone based

Vehicle based

Revenue Opportunity: HMI – Display

Apps

All Data accessed from CloudSmartphone / in-built modem used for connectivity

Revenue Opportunity: App / embedded unit

Virtual skins loaded both on car and mobile phoneSmartphone provides connectivity

Revenue Opportunity: HMI - Display

Revenue Opportunity: HMI - Display

Apps Apps

Apps

Smartphone used for connectivity

Apps

Future Connectivity Trends: VNC based data replicator method popular today as future leans towards cloud based head unit

10

20162010 Western Europe

North America

Brazil China India Korea Russia0

1000

2000

3000

4000

5000

6000

7000

8000

2014

8.4M

Th

ou

san

ds

17.2 M

OE Embedded Navigation – Growth expected across markets as connectivity gains importance among OEMs. China is leading the emerging economies.

9.3

Total Market for OE embedded Navigation Forecasts ( Unit Shipments)

Source: Frost & Sullivan

55.2%

28%

44.8%

26.7%

11.9%

11M6AO - 18

Telematics Related Apps

BMW Roadside

Assistance

Mercedes Mbrace

App

BMW Connected

App

Continental TPMS App

Vehicle Information

Apps

Audi Car Monitor

App

myChevrolet App

Ciao Fiat Smartphon

e App

Dynolicius –

Diagnostics App

Entertainment Apps

Toyota I Heart

Internet Radio App

Ford - Sync Enabled Pandora

Ford – Sync

Enabled Stitcher

BMW/Mini Connected

App

Location Based Service Apps

Toyota Park Smart

App

OnStar Mylink App

Trapster – Speed

Camera App

Viper Smart Start

Remote App

Navigation Related Apps

TomTom Navigation

App

Bosch Navigation

App

Toyota Smart G-Book App

Mercedes Smart

Drive App

Others

EV Apps – BMW

Active E, Nissan

LEAF apps

Zip Car – Car

Sharing App

Fauercia Smart Fit –

Seat Related

App

Green Apps – Green

Meter App

OEMs are Currently working on Developing API to Control Entertainment Apps on Smartphones through vehicle HMI and at the same time working on Free LBS Apps

12

Europe : Current Usage of Apps

• Apps that keep people generally informed are most popularly used. Yet, awareness and usage of apps is low-to-moderate.

• Apps used inside the car are generally car-related – with navigation being the most popularly used. • High Apps Users – though a small segment of the population – are likely the target for car-related apps, given their daily usage of multiple apps.

Navig-ation

Live Traffic

TravelMusic

Internet Radio

Access to Smartphone Apps Inside Car

Source: Frost & Sullivan

High Apps Users: 9%

Moderate-to-Low Apps

Users: 88%

13

Embedded Systems Being Replaced by Hybrid

Systems

Revenue model in short to medium term will focus on

interfaces

Terminal Mode Type Solutions are Money

Spinners

QNX iPhone out is already commercialized by BMW

and similar implementations will follow

Mission Critical Services will be Embedded in

Europe

Services like eCall, SVT will be embedded for reliability

and accuracy sake

Vehicle Related Apps are Crucial for OEM

DevelopmentDiagnostics type apps will be developed by OEMs as this data is proprietary to

them Key Findings &

Conclusions

Apps Usage

Apps usage in Europe from smartphone in cars is very moderate and used on a

weekly level

Conclusions - Opportunities are High in Integrating Concepts like Terminal Mode thus Allowing a Host of Features in a Low Cost Manner inside the Car