Saturday, October 12, 2013

Mobile computing and the future of the automobile

I'm deviating from my usual focus on capital markets here to share some early thoughts on what I believe to be the future of the automobile industry.

Recently, after a decade of not owning an automobile, I purchased a car. The car comes with an in-dash entertainment/navigation system that would have likely blown my mind ten years ago but today, despite it being an award-winning top-of-the-line system, it feels nothing short of antiquated. I find myself constantly thinking, “My phone would be better at this.” The problem, in my opinion, is the mismatch between mechanical and computing life cycles. The median age of the American automobile fleet is 11.2 years according to consulting firm Polk. In a computing time-table, 11 years is an eternity. To put it in context, the first generation iPhone was released only 5 years ago, in June 2007. In that short span of time we’ve seen cellular data technology transition from GPRS/G2 to 3G to 4G to 4G LTE which represents an increase from ~150kbps effective speeds for non-EDGE 2G to 11-16mbps on the newer 4G LTE networks. In the last 4 years alone, mobile phone bandwidth has increased by a factor of 6 and screen resolution has doubled and we’ve seen the introduction of what is probably the most advanced voice-recognition technology available to the mobile consumer.

How is this relevant? Except for functions that are unlikely to change much in coming years like speakerphone capabilities or digital audio playback, the technologies at the center of modern in-car computers like data connectivity, A-GPS-aided navigation and voice recognition are evolving more rapidly than the replacement cycle of automobiles, leading to cars which have useful lives multiple times longer than the technology at the center of the user interface. Which brings us to the question; does the automobile really need an embedded computer?

As smart-phones become ubiquitous and the computing power available in them grows exponentially, it makes sense to allow our smartphones to become our on-board entertainment and navigation systems. Just like the embedded car-phone gave way to Bluetooth hands-free technology and trunk-loaded CD changers were replaced by mini jacks and Bluetooth audio, so will data connectivity and navigation / entertainment systems. It simply makes no sense to embed wireless connectivity circuitry that will be woefully out-of-date in 3 years to a machine expected to last 15 years or more. It artificially severely limits the useful life span of an automobile and non-luxury producers will soon adapt as they see the opportunity to reduce costs while touting it as an advantage for the type of consumer that can’t afford to replace a car every 3 or 4 years.

Once products like Ubuntu EDGE become a reality, there will be no need for auto manufacturers to include on-board entertainment computers anymore. Cars will feature a “dock” (wired initially, but eventually transitioning to wireless and featuring inductive-charging) and the necessary peripherals (microphone, displays, speakers, physical controls, if any). Your handset already has your music, your phone book, your address book, voice recognition, data-connectivity and A-GPS capabilities. Most importantly, your handset can (and does for many of us) back-up wirelessly and constantly to the cloud, ensuring that replacing our smartphone is as easy as buying and activating a new device and ensuring the possibility of massive data loss is minimal and the pain of transferring information to a new car (for example, a rental) is painless.

41 comments:

  1. This is the exact same logic I argue for the "Apple TV" being a separate display & CPU. It makes more sense to connect my phone to a jack and mirror have the in-dash unit function as a second monitor that gets it's info from the phone while charging it.

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