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Google speeds past Apple in race to connected car experiences

The connected car could be the next big battleground for the mobile industry, with Google and Apple both aggressively moving to shore up a meaningful role in this quickly growing market.

The connected car ? whether the Internet connection is embedded in the car or enabled through a smartphone ? is expected to be one of the big stories coming out of this week's Consumer Electronics Show, with rumors already flying about a new partnership between Google and Audi. However, with plenty of competitors and brands favoring customized in-car experiences, Apple and Google both have a long road of pitching marketers and standardizing in-car experiences. 

?The connected car is nearly irrelevant to Apple and Google, which is why much of what they focus on is smartphone connections in the car for screen replication ? Apple mainly, but Google as well,? said Roger C. Lanctot, associate director at Strategy Analytics, Newton, MA.

?Only Google has explored deeper automotive implications such as the self-driving car and Google Earth,? he said. ?Google is now pushing the adoption of Android OS in the car and, very likely, Google Maps. 

"For Google, it is all about search-based advertising. Apple is solely interested in selling its devices.?

Plugged-in drivers
As more marketers and manufacturers branch out from smartphone and tablet markets for their mobile initiatives, Google and Apple are both vying for a share of the connected car market as an extension of their successes with mobile devices.

This week, it is expected that Google and German automaker Audi will announce a partnership at the CES in Las Vegas.

The deal will leverage Google?s Android operating system to power an in-car system that gives Audi drivers and passengers access to navigation tools, apps and music. Audi also works with Apple on other in-car experiences.

The partnership is Google?s attempt to take a direct hit at Apple?s iOS in the Car service that was announced in June. IOS in the Car provides many of the same features as Google and also integrates with some iOS-specific services including Siri and iMessage.

Last month, Apple signed a deal with Honda to integrate iOS into its Honda Civic car.

Similar to Apple?s strategy in other markets, the manufacturer wants sole control of the in-car experience through a closed-wall system.

Then there is BlackBerry?s QNX software, which is one of the main assets that the manufacturer is relying on to boost slumping smartphone sales.

The technology powers in-dashboard GPS and entertainment systems in addition to hooking up with the BlackBerry 10 operating system and Playbook tablet.

QNX contributed to $63 million in BlackBerry?s revenue in the second quarter of 2013 and powers a significant portion of in-car systems currently on the market.

With both Apple and Google creeping into the Canadian manufacturer?s territory, it is possible that BlackBerry may lose its hold since iPhone and Android devices make up the majority of smartphone market share.

However, the growth in Android and other smartphone operating systems means that marketers want an open system that Google is known for supporting, which could give it a significant lead over both competitors.

?While Apple has revealed itself as an early leader in the connected car/consumer telematics space through both OEM and aftermarket options for product integration, automakers aren't likely to champion the mutually exclusive operating system nature of today's smartphone markets ? at least not yet ? due to a divergence of consumer preferences across vehicle make/model car segments,? said Ryan Martin, associate analyst at Yankee Group, Boston.

?It's more likely that automakers will ? or really, should ? advocate interoperability so as to not corner their addressable market, regardless of whether Android, iOS or internal development,? he said.

At the same time, many of the in-car experiences that both manufacturers and automakers are creating are basically an extension of a smartphone experience.

Take Ford?s Sync program, for example.

Ford was early to the connected car experience with its in-car communication system Sync. A recent extension of the program is Sync Applink, which navigates mobile apps through voice recognition.

Hyundai is also in the process of developing a Google Glass app that will unlock and turn on its Genesis sedans. The app will include push notifications to alert consumers of when their car is due for a repair.

The app will fit in with Hyundai?s existent service-oriented mobile apps as part of the car brand?s Car Care and Blue Link programs.

Instead of completely reinventing the marketing wheel, the momentum for automakers right now is more around replicating a mobile screen inside the car, according to Nitesh Patel, London-based senior analyst for wireless media strategies at Strategy Analytics.

?For marketers, while the connected car provides another channel for marketers to engage with customers, the reality is the opportunity will be through amplified handset-based connectivity,? he said.

Increasing scale
According to GSMA, the global connected car market will be worth ?39 billion ? or roughly $53 billion ? in 2018. This represents nearly a seven-fold increase in the number of cars being rolled out with mobile technology.

With the number of automakers increasingly interested in connected-car experiences, the major issue for automakers will be scale.

Instead of a one-stroke approach, automakers want to tailor their mobile in-care experiences with specific value propositions based on a brand?s demographic.

Essentially, these value propositions are split between offering consumers an enhanced driving experience or advertising opportunities and the amount of overlap between the two is questionable, according to experts.

Additionally, the work with entertainment and in-car marketing could be considered the more nascent proposition since safety traditionally trumps entertainment for automakers.

Similar to the mobile ecosystem, there will always be some fragmentation in the space. However, there is a greater need for marketers to set standards around what the in-car experience looks like if marketers expect for the space to grow. 

?This will help address key market development requirements such as remotely-provisioned SIMs and interoperable architecture for in-market SIM management,? said Shane Rooney, executive director of smart cities, transport and automotive of the connected living program at GSMA, London.

?The benefits are clear for the automotive OEMs who will establish an ongoing relationship with its customers and the mobile operators providing value beyond connectivity,? he said.

Final Take
Lauren Johnson is associate reporter on Mobile Marketer, New York