Many technology giants view cars made smarter by plug-in devices as the next big thing after smartphones, smart television and routers.
For years, automakers have been moving in this direction, but the problem is that the smarter the car gets, the more unaffordable it becomes. This has left the door open for third parties to offer small and cheap devices with highly compatible standards to carve a niche in this emerging market.
After all, with about 137 million cars running in China as of last year, no one can afford to overlook the market potential.
At this year’s Beijing Auto Expo, Baidu unveiled CarNet, a Bluetooth-based auto accessory that can seamlessly connect the driver’s smartphone with the car’s onboard computer.
Tencent (00700.HK) also launched the trial testing of Lubao Hezi this May, a USB-drive-like device, which, if plugged into a smartphone, can display real-time fuel consumption, distance covered and other driving feedback data.
Alibaba is also said to be studying similar offerings following its takeover of AutoNavi Holdings Ltd. (AMAP.US), a digital mapping and navigation firm that commands the largest user base in the country.
These products can cost less than 1,000 yuan (US$161) per unit, according to Southern Weekend.
The race is not limited to the big guns. A Beijing-based startup has come up with AutoBot, which sells for just 299-399 yuan. It features quick engine check, fuel consumption analysis, shortest route search, voice navigation as well as pertinent tips to enhance safe driving.
Even before the “go smart” drive, carmakers have equipped their models with an onboard diagnostic (OBD) computer since the late 1990s. The system monitors the condition of the engine, powertrain and other key parts of the car. Repair or maintenance can be done promptly with the information provided by OBD. However, only mechanics could access it through an OBD port usually found under or near the steering wheel.
Carmakers use various versions of OBD and none of them are willing to allow tech firms to directly embed their software and products into the system. As a result, all of the smart accessories available on the market rely on the OBD port to connect to the car.
It is said that even Apple Inc. failed to convince carmakers to open their OBD when it proposed to run its iPhone-based iOS mobile operating system directly within the in-car control systems. Apple CarPlay, which allows Apple devices to function with built-in display on the car dashboard, is seen as a mere workaround since it also has to use the port.
In this regard, Apple and other tech firms are basically in the same league in terms of technology, but product homogenization is becoming a problem, analysts say.
The race is now focused on who can break through the barriers put up by the carmakers. The tech firm that can establish an alliance with the carmakers to offer integrated services within the OBD ecosystem will hold an edge over rivals who can only offer plug-ins.
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