Study: Satellite targets connected cars
September 8, 2020
By Chris Forrester
Connected cars and vehicles, with their potential for massive terabytes of data, are very much on the radar for satellite operators.
A study from Northern Sky Research (NSR) says “Connected cars are one component of this new revenue growth, and with a huge addressable market, it’s no wonder satellite operators, ground equipment manufacturers and service providers are all keen to enter the fray and carve out a piece for themselves. After all, with tens of millions of cars sold per year, penetration into a small percentage of cars sold would lead to enormous revenues, right?”
The answer is not so simple which NSR admits; “With challenging use cases, pricing issues, and installation problems all creating barriers to widespread implementation. How should companies adapt to Connected Car realities?” NSR asks.
The research company’s latest study (Land Mobile via Satellite) says that even while excluding trains and buses the broadband Connected Car market will reach more than $1 billion in value by 2029, from a negligible amount today.
Revenues generated currently are mostly from first responder type vehicles – fire services, ambulances and police. “Even in places like Japan, where there is significant terrestrial connectivity, emergency responders are actively keen to install satellite connectivity to increase reliability and reach. Luxury vehicles will also be expected to incorporate satellite connectivity in some models after 2025/2026, once vehicle designs incorporating a flat panel antenna are locked in in the near future,” states NSR.
“However, with automotive market research company Jato identifying that in 2018, 86 million cars were sold in the top 54 world markets, NSR expects a penetration rate, even in 2029, to be well below 1 per cent. Substantial new revenues will be generated from this relative niche; however, NSR is not expecting further penetration of the consumer market given the number of challenges more broadly.”
NSR admits that today’s activity is handled by terrestrial means, and mostly via third-party devices such as a smart phone. “Safety and emergency calling does not require a broadband connection and could be supported by a store and forward type L-band solution, or even a nanosatellite terminal – much like Europe’s terrestrial eCall service,” says NSR.
Kymeta, which specialises in ground-based satellite antennas (usually for military vehicles) has its u8 version antenna available for $999 per month.
NSR suggests that these costs will fall but even Kymeta would have difficulty in bringing its costs down to mass-market levels. Another business, China-based auto-giant Geely is also working in this area – and is building its own satellite mega-constellation – but given its Chinese credentials might not find acceptance everywhere.
NSR’s advice is that satellite operators must be crystal clear about their objectives: “Before autonomous car sales become widespread, targeting only the highest value customers is a must (the rest will use terrestrial only networks, if any), and be complete with an end-to-end service platform. Attempting to target the broad consumer market will only waste years of effort, with a platform with mismatched consumer technology rather than focused enterprise and first responder features, and a go-to-market strategy to match.”