Frost & Sullivan Foresees Revenue Opportunity in Automotive Apps

According to a new report by Frost & Sullivan, there is a revenue opportunity for vehicle manufacturers to deliver applications to their customers if they can develop the right eco-system.

According to the report, “Smartphone interface technologies such as Ford SYNC Applink, Nokia MirrorLink and several other concepts have given VMs the confidence to pursue smartphone and apps, not as a threat but as a revenue generator and crowd puller. With all this in place and the advent of touch screen and advanced voice interfaces inside the car, the time is ideal for VMs to leverage these drivers and make a revenue case.“

However the market research firm pinpoints an important challenge on the road to app success. “The biggest challenge that remains is that of Vehicle Manufacturers (VMs) allowing previously tier 2 software providers, handset makers and app companies more power than before,” remarks the author of the report, analyst Krishna Jayaraman. “Considering the tight control VMs exert over their supply chain, this will be the biggest block to overcome, if VMs hope to make money out of apps and smartphone interfaces.”

The key point for Frost & Sullivan is that car makers need to create an ecosystem of developers and apps that they can host inside the car through either a common standard like the Nokia MirrorLink or through a proprietary standard like the Jaguar Connect and View, developed with RealVNC.

“Either way the need of the hour is not a strict OEM, tier 1 or tier 2 relationships,” explains Jayaraman. “Instead, what is required is an ecosystem approach where every partner adds value to the overall offer.”

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