The tech industry has been
cozied up with automotive for years – Ford & Microsoft launched SYNC over
ten years ago – but only recently has there been sufficient technological
advancement to create a meaningful need to extend tech brands into the vehicle.
The first major successes were Apple’s CarPlay and Google’s Android Auto, and these platforms have created waves of disruption through the
industry. While automotive OEMs still struggle to figure out how to build
compelling in-vehicle infotainment experiences, it seems the tech industry has
been able to build compelling experiences from nearly day one.
No company has invested more into
its automotive expansion than Google, whose far-reaching investments (including
those by its parent company, Alphabet) paint an extraordinarily comprehensive
ecosystem of technology platforms that allow Google to monetize mobility.
In this insight, we have catalogued
five distinct products & brands that have positioned Google as a leading
force in the automotive space in the coming years.
While consumer virtual personal assistants are still relatively new, Google and Amazon – the two dominant
market leaders – have taken distinct approaches to extending their presence.
Amazon’s Alexa can be found in millions of homes, leveraging the popularity and
low price point of the Echo and Echo Dot smart speakers. Google Assistant is the market leader in terms of
performance, and with the announcement at Google IO 2019 that its entire
knowledge graph has been compressed to a mere 500 MB, we can expect that
feature-rich, reliable, and low latency Assistant will be the leading
in-vehicle experience on the market by 2020.
Android & Android Automotive
After announcing agreements to launch Google’s proprietary embedded Android Automotive platform with Volvo and Renault-Nissan-Mitsubishi, Google has detailed its plan to allow developers to build and deploy apps on the platform starting later in 2019. Support has already been built into Android Studio 3.5, with only media apps being made available to start, while other apps – such as messaging and social media – will be made available later. The platform follows the Android Auto framework for apps.
Even OEMs who have not adopted Android Automotive are moving towards the open source flavor of Android, with a majority of OEMs globally adopting Android Open Source Project for its IVI operating system.
As a separate brand under the
Alphabet umbrella, Waymo has generally stayed away from Google’s other industry
activities. However, as perhaps the most advanced robotaxi company on the
market, Waymo is poised to disrupt the automotive industry even more broadly
than Assistant and Android Automotive. Consider a scenario where consumers are
summoning Waymo vehicles, and when inside the vehicle are presented with an
entirely Google or Waymo branded experience, leveraging the Android Automotive
platform. This scenario marginalizes the traditional OEMs as wholesale
suppliers to companies like Waymo and further explains why we see multi-billion
dollar investments from companies like Ford and GM into mobility and automated
While there are other extremely
viable mapping platforms, no one has dominated the consumer
mapping and navigation market quite like Google Maps. The ability to search for
a destination on your phone and then have it seamlessly appear on your embedded
Google Maps experience is one of the killer apps of mobility that will be
incredibly difficult for anyone else besides Google to replicate. Unless Google
adds native Maps integration with non-Android Automotive systems, we’d expect
this experience to be one of the main selling points of vehicles equipped with
Google Maps is also the key to the
platform that brings everything together – Google Ads. If Google controls the
entire customer journey, a diverse array of monetization opportunities through
advertising present themselves. Consider the ability for retailers to promote
POI search results, including in real-time on the journey itself, and
furthermore provide compelling discounts or promotions. Outside of Waymo, this
is the real monetization opportunity that motivates Google’s automotive ambitions:
to create a closed-loop of consumer data that allows them to target high-value
ads within the journey planning process.
"It’s probably a stretch to say that
Google will be the dominant automotive company of the next decade" says Alex Oyler, Head of Car IT at SBD Automotive, "but
with a portfolio of investments that positions it as a leading market force,
automotive OEMs, tier 1s, and service providers will all be investing in and
building solutions that allow them to either compete with an aspect of Google’s
value chain or position themselves within, often times at much lower margins".