Toyota Unveils Its Connected Strategy, Sidelines Google And Apple

Author

Bertel Schmitt

November 4, 2016

Google and Apple can be proud of one thing: they lifted global automakers off their collective duffs. Around the world, OEMs suddenly race to close the perceived digital gap, as they are hell-bent on connecting the billion or so cars on the world’s roads to the cloud. One by one, however, OEMs announce that they will shoot for the cloud without the help of Google or Apple. Toyota, the world’s largest automaker unveiled part of its digital strategy today – a strategy that has Google and Apple out of the equation.

“To guarantee the safety of the customer, the manufacturer must be the platform provider,” said Shigeki Tomoyama, President of Toyota’s newly founded connected car company, which in tune with the prevailing zeitgeist is simply called “Connected Car Company.” The platform has a likewise simple name: “Mobility Service Platform,” or MSPF for the acronym-addicted. To build that platform, Toyota took full control of its platform creation, choosing to not go the simple route of calling Cupertino or Mountain View.


toyota-platform

As intimated by your truly a week ago, Toyota’s digital platform runs on Automotive Grade Linux, a mission-spec operating system jointly developed by automakers and suppliers around the world in open-source fashion. Permanent connectivity is provided by the Japanese telecom company KDDI and local mobile data carriers. KDDI has collaborated with Toyota since the early days of G-Book, Toyota’s Japanese answer to GM’s Onstar.

Cloud services are provided via Microsoft’s Azure, which was introduced to Toyota in 2011 by Mark Benioff’s Salesforce. Oddly, Salesforce was not mentioned at all today.

Google, wait outside

You are not alone in missing Apple and Google in Toyota’s digital lineup. The Silicon Valley companies reportedly ditched plans to make cars and shifted to strictly developing automotive software, but Toyota is closing the door on participation from the tech giants. When asked by a reporter where Google and Apple fit into Toyota’s digital plans, an iPad-wielding Tomoyama diplomatically said that “we do not think we will be competing head-on with IT companies such as Google, with our platforms linked together, we can provide even better services for our customers.”

 

Shigeki Tomoyama (Picture: Bertel Schmitt)

 

Shigeki Tomoyama (Picture: Bertel Schmitt)

A look at Toyota’s new systems architecture shows how the company views that togetherness: Android and iPhones can be beamed “picture only” onto the car’s screen via Ford-developed SmartDeviceLink, but the real apps will be written by Toyota, or supplied by 3rd parties writing to a Toyota-supplied application program interface, or API. “We also plan to use over-the-air wireless transmission to automatically update onboard software,” Tomoyama promised.

Toyota’s apps run the gamut of what Apple and Google currently offer, but are more customized to the driving experience. Dynamic maps show the best route like Google maps, but due to tighter integration with the car’s onboard sensors, the Toyota map can perform tricks like warning about ice on the road or flashing the best evacuation routes in case of natural disasters. If a red light blinks in the dash, the Toyota customer no longer will have to dig for the manual to decipher the LED’s deeper meaning. The problem is analyzed, explained, and if necessary, a computerized concierge books a service bay at the next Toyota dealer – directions to which are provided on-screen. Eventually, the dynamic maps will be updated in real time and they will reflect the inputs collected by cars in front of us.

Some of the possibly creepier aspects of the system are that it can grade our driving habits and send them to our insurance company. Millions of Americans already have traded their privacy for lower insurance rates, and Toyota wants to facilitate the trade.

 

 

In the cockpit of the latest Prius hybrid vehicle (Photo: TOSHIFUMI KITAMURA/AFP/Getty Images)

Toyota hearts car sharing

Toyota embraces car sharing as one of its platform services. What am I saying? Toyota hugs, kisses, and fondles car sharing. “The biggest problem of car sharing is the key,” said Tomoyama, and Toyota solves that with its Smart Key Box. It literally is a small metal box full of electronics, connected to the car’s Controller Area Network (CAN), its GPS, and wirelessly to Toyota’s cloud. A “key,” actually a small digital token, is generated and transmitted to the user’s smartphone. The user walks up to the car, their smartphone communicates with the box via Bluetooth and the door opens if the box agrees with the digital key. The car is ours, as long and as far as the owner decides.

The Smart Key Box can be retrofitted to most halfway modern Toyota cars. By 2020, the box is planned to be in most Toyota cars in the U,S. and Japan, with other markets to follow. In series production, the box most likely will make way to integrated electronics.

 

The Smart Key Box (Picture: Bertel Schmitt)

 

The Smart Key Box (Picture: Bertel Schmitt)

Toyota’s jump on the car sharing bandwagon is not the “if you can beat them, join them” move surmised elsewhere. It is a way to sell more cars. Toyota thinks that by 2020, there will be 10 million shared cars in the world, and Toyota wants to own that market. It also sees it as a way of making car purchases financially a little more palatable. Through special lease programs, money generated through car sharing will be deducted from the lease payment. Having a busy car can pay for itself.

Japan-German data axis

Other large OEMs are making similar moves, and the ones who can afford it are united in the aim of keeping Google and Apple away from their crown jewel data. Last week, Renault/Nissan announced a similar own platform project. On Monday, Ford hired Blackberry, not Google or Apple, to write the software for the Dearborn company’s connected vehicles.

Germany’s carmaker powerhouses Daimler, BMW and Volkswagen jointly spent $3.1 billion to buy Nokia’s mapmaking business in another move to keep away Google and its allegedly free maps. Automotive News wrote on Monday  that a digital mapping company “wants to bring a Japanese automotive partner into its ownership as it expands to supply the high-definition maps and cloud computing necessary for self-driving cars.” Japan’s automakers have a similar joint venture, called Dynamic Map Planning Co.

A German/Japanese data axis “would make strategic sense,” a Toyota executive told me today on the sidelines of the event. Dynamic mapping is all about scale, the more cars you have on the roads, the better the maps. Once every car has the same capabilities of a Google car, and it needs them to be halfway autonomous, Google maps will end up as disrupted as paper maps are today.

$800 billion market

There is one aspect of the Big Data game that is rarely mentioned: a connected customer will remain tied to the company. Carmakers lose touch with the customer once the warranty runs out. The seas of used car buyers mostly remain uncharted waters for auto company marketers. Once connected throughout the life cycle of the car, customers remain plugged into the world’s largest customer retention program, they are willing targets for new tires exactly when the old ones are worn out or for a new car when the old one is too costly to repair. Arthur D Little estimates the size of the global automotive aftermarket alone at $800 billion annually, Google advertising revenue was $19 billion last year.

 

This article was written by Bertel Schmitt from Forbes and was legally licensed through the NewsCred publisher network.

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