Who Will Win the “Connected Car” Wars?

The connected car is here – a vehicle able to optimize the driving experience for comfort, performance and entertainment using onboard sensors and internet connectivity.

Consulting firm McKinsey & Company estimates the global market for connectivity components and services to be worth around $30 billion, and is expected to increase 5x over the 5 years.  By 2020, one in five cars will be connected to the internet, delivering services through the car – internet radio, smartphone capabilities, information/entertainment services, driver-assistance apps, tourism information and more.

Today’s car is a modern wonder, carrying the computing power of 20 personal computers and processing up to 25 gigabytes of data an hour. In the past, the presence of onboard computers was meant to optimize a car’s internal functions but today, these components are all about user experience.

According to a study by Spanish broadband and telecommunications provider Telefonica, almost three-quarters of drivers surveyed are interested in or are already using connected car services. A similar number of people felt cars will soon have a level of connectivity on par with the smartphone most people carry in their pockets.


With so much real estate in the marketplace, established tech companies will be fighting to gain market share. Apple recently introduced Carplay, a vehicular-based operating system. Dubbed “the best iPhone experience on four wheels”, Carplay allows drivers to use their iPhone through their car’s media systems. Motorists can send messages, choose music, or even receive directions – all via voice command.

The Carplay system will be available across 29 car brands, including Ford, BMW and Toyota. Meanwhile, Google has formed the Open Automotive Alliance, an alliance of auto manufacturers and tech companies aimed at using the Android platform in automobiles. In June 2014, Google announced that it had 40 partners from all across the world.

One of the more unexpected competitors is Blackberry. The struggling company acquired Ottawa-based QNX Software Systems in 2010, providing a foot-in-the-door of the nascent connected car market. QNX was previously an industry leader in telematics –the blending of computers and wireless communications in vehicles – and today commands more than half of the rapidly growing market for in-car “infotainment”. While QNX only provides 8% of Blackberry’s revenue, it is the one area where the former giant still commands leadership. As of January this year, QNX said its software can be found in more than 50 million vehicles globally.

And so it would seem that Apple, Google and Blackberry are all jockeying for pole position, but the truth is there is far more collaboration going on behind the scenes. Carplay can run on a QNX-based system, a system that is also capable of running Android apps. In fact QNX’s VP of sales and marketing remarked that “I’ve never thought of us as a competitor…We have been working with Apple for many years”. He also said that “Google and QNX have been collaborating for years – including on the integration of Google Earth into Audi cars”.


QNX will likely continue to lead the market for the next few years. Apple will likely continue to focus on their Carplay offering, making it the most elegant on-board infotainment solution out there. Apple sees the connected car as just another accessory. They want to be in as many cars as possible, and both companies want to make money but the difference is in where the money comes from. QNX’s prerogative is to strike deals with automotive partners while Apple targets the consumer directly – extending the Apple store into the car.

Google might be on a completely different path. Although they may start out with infotainment, Google is hungry for data. Google’s $40 billion in annual revenue is driven by advertising and “access to information about exactly how and where millions of people are driving would further its advertising ventures”. The fact that Google is building an automobile-specific Android OS shows how serious they are. Staking their claim in this market will only help them in their quest for dominance in another: the autonomous car. The seamless combination of both elements, autonomy and connectivity, is the big payoff Google is looking for.

Top automobile manufacturers have been working on components for autonomous cars for years. Automatic parking systems are evidence of that. However Google has the head start, having worked in the field for years.

It’s all coming together and the future looks exciting.  In the long-term, Google is more of a competitor to automotive manufacturers than Apple or Blackberry; they are the ones who actually have the most to gain by entering the automobile market. It is easy to imagine a future where Google outsources the manufacture of autonomous vehicles under the branding of established players. They might even go so far as to produce autonomous vehicles under their own branding.


No matter what happens, automotive giants will have to watch carefully and consider their strategy. Do they engage with Google on their own terms? Do they hold their stance? Should they put more resources into driverless technology or look into building autonomous technology of their own?

The connected car movement looks to give rise to the autonomous car, and they represent the short and long-term future of automobiles respectively. As technology improves, connectivity and driverless features may converge into a perfect autonomous driving experience spearheaded by Google.  Imagine getting into your car, opening up your tablet or device – synced to your car’s on-board systems – to listen to Pandora and getting some work done while being driven to work.

I’d like to see that future. Make it happen Google!

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