The first in-depth report into the future of the industry claims that by 2020, 90 percent of new vehicles will have in-built connectivity but that there are still a number of major obstacles to overcome before innovations can really bring consumer benefits.
Published by Telefonica, the Connected Car Industry 2013 report details what it calls the car industry's biggest transformation in over a century and how consumer demand as much as technological advancement is driving this transformation.
For example, Audi to date has 50,000 Audi Connect customers that use its telematics and infotainment systems but together they have already downloaded over 75 terabytes of data since 2011.
One of the biggest immediate changes that connectivity will bring is the way in which problems are reported, quality is measured and news is shared. Cars will be able to automatically arrange proactive maintenance appointments and notify manufacturers and other drivers of mechanical or electronic faults.
New services, new costs
But this benefit comes with a cost. Transferring data cannot be done free of charge and car companies will need to identify ways of billing for their services that do not deter consumers from embracing the technology, or from rejecting it and using apps on their own devices.
This is another obstacle. Apps and features that are safe to use in a car need to be built to specific standards and meet legal regulations so car companies have to find a way of attracting the best app developers to their vehicles for special versions of their apps and charging for them in a way that consumers don't feel they're ‘being taken for a ride'.
As the report highlights: "Car manufacturers need to develop innovative pricing models that provide the flexibility and value that consumers demand from comparable services. General Motors has suggested that mobile operators could recognise vehicles as a second device on a customer's data plan for a low monthly fee, or advertising models could be introduced to part-fund connectivity."
Telefonica believes that car companies are going to have to forge stronger relationships with network operators to solve this problem but also to be able to offer global connectivity and access to information for drivers and their cars. BMW has already taken a big step in this regard by partnering with Vodafone so that BMW owners can stream music to their cars from anywhere in Europe without roaming or data charges. Instead, they pay a simple flat, monthly fee.
'Why own a car when every car can adapt to you?'
But once all of these obstacles have been overcome, the door to fully autonomous cars will open. As futurist and report contributor Ian Pearson explains: "In the further future, cars will come to you. They will take you where you want, and then you can just abandon them to go off to serve someone else. They will in effect offer a comfortable and socially inclusive form of public transport. This could even lead to buses disappearing from our streets," he says. "Personalisation of the car environment will also become common. As you get in, the seat will automatically move to your preferred position, instructed by your phone. Even fabrics and other interior surfaces will be able to adapt their appearance and textures electronically to your taste. This could reduce the demand for ownership even further. Why own your own car when every car feels like it's yours?"