What Is Telematics and Why Does it Matter?

Automotive technology is undoubtedly impressive. 

Growing up, I remember playing my favorite cassette tapes and CDs in my parents’ station wagon. My parents, in turn, remember their first cars with an 8-track player. Now, we can connect our iPhones to our cars via CarPlay to play music, direct us to our destination and use Siri to send messages to our friends. Cars are becoming increasingly connected over time.  In fact, companies are creating so many vehicle-related technologies that we’ve coined a term used almost exclusively for the automotive industry: telematics.

So...What Exactly is Telematics?

Telematics is the utilization of telecommunications networks to transmit information to and from assets at a distance. To put it in easier-to-understand terms, it’s the tracking, monitoring and connectivity of vehicles. Essentially, anything that would be considered part of the Internet of Things related to vehicles could fall under telematics.

As a note, we get the word “telematics” from the blend of “telecommunications” and “informatics.” Word math!

The field of telematics took off with the creation of the GPS system by the US military and was first made available to the public in 1985. It really gained steam with the popularity of emergency assistance buttons in cars (never forget the amazing OnStar commercials), which would make a call to local authorities in the case of an accident or another emergency. We’ve gone far beyond these initial uses. Telematics have become so commonplace in many areas of the automotive industry that we don’t even think of them as advanced connected technologies, such as remote keyless entry. When was the last time you’ve walked away from your car, locked it, and thought about how it actually worked? You can thank telematics for that one!

Telematics has always involved the transfer of data from a device to a means of analyzing it. Earlier technologies required a physical transfer of data through USB ports to a computer. Now, telematics can exchange data via Bluetooth or cellular networks directly from the device rather than just relying on a wire-based transfer. Developers have also always built telematics on closed systems, but with the advent of APIs and interoperability, they have moved to open platforms to allow integration with other software or accessories.

Telematics Applications & Examples

We’ve discussed what telematics is, but let’s dig a bit deeper into some of the current and future uses to really understand how this field will shape the automotive industry as we know it.

Fleet Management

Many companies own a large number of vehicles and contract them out for use by other companies to complete deliveries, transporting or hundreds of other applications. On average, the industry loses over 50 million hours recording and storing driving usage data. On top of this, fleet managers use retrospectively self-reported data to keep tabs on performance, drivers and the health of each vehicle. This doesn't help managers predict maintenance issues for vehicles, streamline compliance or adequately improve the efficiency of its fleets.

With an IoT-enabled onboard diagnostics solution, managers and drivers can be on top of maintenance issues before they cause a breakdown or other urgent vehicle issues. Fleet managers can also use IoT to direct drivers’ behaviors to save money and ensure the safety of their people behind the wheel. This second Applications is closely related to the telematics systems enabling auto insurance companies to tailor rates specifically to a driver’s history, saving money for safe drivers.

Car-to-X Technologies

Car-to-X is an incredibly exciting field to those eagerly awaiting the passenger economy and the growth of true smart cities. The name sounds vague, and it's that way purposefully. Replace “X” with vehicle, pedestrian, cloud… you name it. As new vehicles or concept cars are released each year, we’re seeing an increasing amount of sensors added to the bodies that allow for car-to-x capabilities. 

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One of the areas that has generated a lot of hype, and rightfully so, is car-to-car technologies. Vehicles can utilize sensors to “talk” to other vehicles on the road, preventing many human errors that lead to accidents. When a car relies on intelligent sensors to communicate with the cars around it, the flow of traffic will also be more constant, rather than stop-and-go, due to a few bad drivers. This area is already seen in newer cars on the road, such as with Ford’s Traffic Jam Assist – a mode that allows the car to match the speed of the car ahead of it in congestion.

With a connection to the cloud, vehicles can receive over-the-air (OTA) updates for different systems, such as infotainment centers, to always be up-to-date with new releases. This benefits not only the user experience and application robustness, but also security updates. I don’t think we need to go over why security patches and updates are important.  

Previously, vehicles couldn't receive updates, and the only way to get them would be to buy a brand new car. That’s one expensive update. Hope Bovenzi of Texas Instruments explains the car-to-x area of telematics and more in-depth on our podcast. 

Telematics: The Future of the Automotive Industry

Telematics is an incredibly important and lucrative area of IoT – don’t sleep on it. As vehicles get closer to higher levels of autonomy, telematics will grow as a field.

Vehicle manufacturers should feel confident in their investments to upgrade technology, and vehicle telematics companies should continue to push the envelope. With synergies between the two, the future base model vehicle and included technologies will look entirely different from the current base in just a few short years. 

Want to learn more about vehicle-related IoT? Check out IoT in the Transportation or Automotive sector.