The Emerging in Vehicle Intelligent Transportation Systems Market

By Starry, Claire | Business Economics, April 2001 | Go to article overview

The Emerging in Vehicle Intelligent Transportation Systems Market


Starry, Claire, Business Economics


The in-vehicle Intelligent Transportation Systems (ITS) market is emerging as a major force in mobile communications. The industry has grown from a few companies pursuing new applications for their technologies to an industry dominated by major automotive, communications, computer, and software companies. Alliances were a key growth strategy and significantly reduced stakeholder risk and product time to market while enabling small as well as large companies to participate in what was then an unproven market. Now, automotive original equipment makers (OEMs) are at the forefront of in-vehicle ITS development, with several other industries eyeing the car as the next major market for their products and technologies.

Over the past fifteen years, the in-vehicle Intelligent Transportation Systems (ITS) industry transformed itself from a few companies pursuing high-risk product development in an unproven market to a dynamic industry and fast-growing market consisting of major companies in the information technology (IT), automotive, communications, and retail industries. Telematics, or the basic technology infrastructure encompassing in-vehicle navigation, communication, information, and entertainment services, is expected to maintain its rapid growth, expanding from a worldwide market of about $4 billion today to about $47 billion by 2010, as reported in Global Positioning & Navigation News (October, 2000).

ITS products and services provide an intelligent link connecting travelers, vehicles, information/ content, and infrastructure, with the goals of reducing traffic congestion and pollution and improving vehicle safety and efficiency. In-vehicle ITS units are becoming more complex and multifunctional, often providing several if not all of the following capabilities:

* Driver assistance with navigation systems enhanced by route guidance

* Driver safety and security systems

* Communications, computing, entertainment, and other systems for drivers and passengers

* Improved commercial vehicle productivity through automated tracking, dispatch and weigh-in-motion systems.

The History of ITS In-vehicle Information Systems

In the late 1980s and early 1990s, a handful of companies started exploring ways to use wireless communications, information, and computing technologies to assist drivers. The market was unknown and risky; consumer response to products was unexplored. Investors and developers in small ITS start-ups found alliances an effective means to obtain the technologies needed to support their research and development as well as deployment efforts. Most of the alliances were technology driven, but some also had market development as a primary objective. The alliances enabled members to share risk, reduce the time to market, and gain access to core competencies not available within their organizations.

Companies such as Etak and Navtek focused on providing digital maps for the in-vehicle navigation market while another two companies, Qualcomm and HighwayMaster (now @Track), pursued fleet management systems for long distance trucking. In vehicle traffic information, safety and security, and wireless communications later became part of bundled ITS offerings. By the mid-1990s, major companies in aerospace and defense, looking for diversification opportunities, were participating in alliances to offer products such as MayDay and GPS (global position satellite) positioning and tracking for vehicles. Also entering the industry were wireless communications, computer, software, and entertainment companies looking to tap a new, large market--the personal vehicle.

The industry was ripe for alliances and collaboration. Micro soft, SunMicrosystems, and others started vying for the operating system for in-vehicle computing systems while IBM, Hewlett Packard, Motorola, and other major companies pursued hardware, interactive voice, and other applications. …

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