Mobility-as-a-Service: How can automotive OEMs monetize quicker with a mobile access solution in 2017?
Two years ago, Gartner predicted that “(…) 37% of enterprise revenue will come from digital business by 2020, more than double the 16% it was in late 2015”.
This is very well reflected in the automotive sector today where industry OEMs are focusing all their efforts on generating service businesses that include electric mobility, along with adjacent service models such as car sharing and new mobility concepts that change the ownership of vehicles altogether. This change in end-user markets towards car ownership has had a big impact on innovation management and business strategy in OEMs such as BMW, Mercedes and Audi.
We have now witnessed great services – apart from the car sharing, car on demand business model, we now also have the car becoming a delivery address for parcels as shown by Amazon together with DHL and Audi.
These mobility services position automotive OEMs at the focal point with a strong focus on car fleet, car rentals, sharing but also novel logistic services as mentioned above. Mobility-as-a-Service is the future and without much of a surprise, it is essentially driven by seamless user experience and flexibility.
Challenge within Vehicle Access (the customer)
In an ideal world, each time I rent a car, I just go to the vehicle, open it and drive off not having to go through a registration and the physical key handover. When using a premium renting on Sundays when I go to the mountains and need a bigger car, I do not really feel like facing a concierge who brings me the car keys while I am still in my PJs. I would rather get the key straight on my phone and access it whenever I want to without having to wait for and then meet servicemen on my doorstep.
In the above scenarios, increasingly becoming part of the Mobility-as-a-Service, I could have my keys virtually deposited to my phone the moment I book the vehicle. No hassle, no waiting, no awkwardness, no admin. Just the key on my phone, off I go.
Current solutions in the industry
Fortunately, automotive companies know it and started addressing this mobile access issue. At the beginning it was clear that a secure, reliable smartphone vehicle access that can be adopted for all these mentioned scenarios globally was needed.
However, what happened was, some car manufacturers approached it by giving it a lick and a promise quickly which resulted in having a way too long response time every time the driver touched the “open” button on their phone, very poor security (remember recent hack attacks) or access technology that did not work in an offline environment which in effect left customers stranded in the mountains or in underground car parks not being able to open the car.
Additionally, some only implemented it either on Android or iOS which from the start did not promise a huge scalability potential.
We have also seen OEMs keeping the offline functionality but this meant a heavy reliance on using the smart element ( e.g. a smart card). This is a good solution for an extra security in the direct OEM sale to the end customer, but doesn’t work in the new mobility era as it is poorly integrated with the app / digital process which is the very thing that makes the customers happy.
Remembering that it is the user experience that makes the Mobility-as-a-Service thrive, the listed above simply hinder any efforts of achieving it.
With this in mind, these are still very current and valid car manufacturer’s challenges which could not be solved in 2015 and 2016 and these are definitely to be addressed in 2017 as otherwise they will have a hard time being successful in the new digital era that puts a big pressure on providing mobility for happy customers.
To recap, these are the following OEM challenges in the Mobility-as-a-Service business:
- Access control is depending on online connectivity – people locked out of the cars in areas where there is no online connectivity
- Offline functionality relying heavily on smart cards – poor integration with the app / digital process itself
- An inconsistent response time (~30 sec – 4 min) – this influences the user experience badly – people just want to press “open” and have the door opened in no time
- Relying on traditional IT network security only – which is not prepared to work reliably on a scale of 40.670,637 cars produced and connected annually in the EU, US and Asia!
The most secure technology for vehicle access
Automotive OEMs know that if they want to succeed long term by providing Mobility-as-a-Service and roll out globally, they will have to base the access on both, Android and iOS which currently have 99% of the market share. Consequently, in terms of security set-up, they won’t be able to continue using Pre-shared keys (PSK) as having the software security with the highest security standards on every device possible can exclusively be provided by PKI (Public Key Infrastructure). Additionally, they will search for more flexibility to control their future business and assets with ease so the solution has to be fully scalable.
PSK and PKI explained
In order to explain the difference between PSK and PKI in simple words and on a commercial level, it is worth comparing PSK to access in Middle Ages; in order to enter a castle, you needed to know a “secret” word. But this word was shared, sold or “tortured” out of people and hence it was not very exclusive and/or secure. Pre-shared key was also a base in all the car access systems that were recently hacked into.
PKI (Public Key Infrastructure), on the other hand, can be compared to the access nowadays; you can only cross the country border if you have your passport which has been previously authorized by the government, and you often will need visa, which, if it doesn’t match your passport, there is no way you can enter the country.
Forecast and tips for 2017 mobile access control
Will the year 2017 be the year with less threats in the vehicle access environment? Hopefully yes as more PKI based technologies are being brought forward.
However, in order to make the future bright in the vehicle access technology, the outlined challenges will need to be addressed with a solution that can:
- Be available on 99% of mobile operating systems for large global roll-outs
- Close the “local gap” between smartphone and car allowing for access at anytime and anywhere and independent of the online connection
- Create an ultimate and fast user experience – response time of approx.1 sec
- Support Bluetooth LE (no need for pairing) / NFC / WIFI
- Be retrofitted in existing OCU / TCUs with Bluetooth (with no need for pairing)
The years 2017-2020 will be the years of mobility emerging as the new wave and for more consumers to experience. It will also be the year of clever solutions that can be flexible and adaptable for a huge scale roll-outs. Access control will be a significant part and it is worthwhile to consider an intelligent solution that will last car manufacturers forever, supporting their growth, rather than bringing it to a halt.