The idea of having devices in a car that can provide information about the car's overall status is a tempting one for many car owners, and onboard diagnostics (OBD) telematics can offer that extra bit of help that many drivers crave. A new report from ABI Research (News - Alert), meanwhile, suggests that the number of drivers with subscriptions to OBD aftermarket telematics devices is set to climb over the course of the next five years, up well over 10 times the subscriber numbers expected for just the end of the year alone.
The ABI Research report expects subscriptions for OBD telematics to hit 9.5 million in 2014, which is a pretty healthy number, but by 2019 it's going to increase by over a factor of 10 to reach 117.8 million in 2019. That's a huge increase by most any standard, and according to ABI Research VP and practice director Dominique Bonte, there are several factors contributing to that substantial gain.
Bonte noted that telematics devices in dongle form have been gaining a lot of ground in North America and Europe, with dongles the weapon of choice as OBD vehicle ports are a mandatory addition to vehicle operations. Plus, telematics markets in North America and Europe are currently more advanced right now, and several options are available to allow that OBD port to offer up a variety of tools from location tracking to driving behavior monitoring to even what amounts to the Holy Grail for many drivers: in-car Wi-Fi connectivity. With a substantial amount of marketing going into telematics efforts--particularly from major carriers like Verizon, AT&T and Sprint in the U.S as well as Vodafone (News - Alert) in Europe—that's opening up some substantial opportunities for drivers to get such devices into vehicles.
Meanwhile, around 2019—just when the current forecast has run its course—the dongle market is set to start buckling a bit, but OBD telematics will carry on. The issue here will prove one of format change, as the market is set to reportedly move from OBD dongles to factory-installed original equipment manufacturer (OEM) telematics devices. However, there will be challenges for the OBD telematics market as a whole, including issues of standard formatting in vehicle data from OEM devices, as well as a closed approach to APIs in which third party developers can't get in on the field to bring new potential applications to the market.
The good news, though, is that those issues are comparatively easy to fix. Changes in formatting, changes in philosophy...these are things that can come around as the result of a multi-party meeting or even a “eureka” moment, so to speak, and change with comparative speed. Once one company puts such changes into play, any positive result seen following that will likely be seized upon by competitors looking to keep up with a clear trend in the market, and that will in turn open the floodgates for third party support.
Still, it's quite clear that there will be plenty of action in the OBD telematics market for quite some time to come. Some changes in the field will spur still more growth, and that makes this a field that has quite a bit of potential behind it as evidenced by even the numbers currently in play. OBD telematics are likely to be part of a lot of drivers' lives for a long time to come.
Edited by Rachel Ramsey