What's Next: Navigating Global Challenges with the Innovation Generation

How a Connected Car Could Mean More than One Without a Driver

Innovations in automotive technology could fundamentally alter other sectors.

Technology that connects cars to traffic signals and can help drivers steer clear of collisions are just the beginning. As auto manufacturers look to innovations that will bring the industry into the 21st Century, the race is on to find new and useful ways to link cars to the world around them using an ever expanding array of networks.

Imagine the vast mob of vehicles criss-crossing a nation’s network of expressways and each communicating with the other. Experts say this scenario, which is already budding in the U.S. and elsewhere, could help reduce accidents, increase fuel efficiency. According to some forecasts, it could also fundamentally alter the landscape for businesses that intersect with the automotive industry.

Once the network of connected cars is writ large, sectors including insurance, manufacturing and even telecommunications might never be the same.

At the most basic level, connected cars feature systems capable of tapping into wide and sophisticated data networks, such as the street-light grids familiar in developed urban areas. Some connected cars, such as the prototypes Google is developing, are also automated and do not require drivers.  The availability of both could grow over time.

Why consumers can’t get enough of the connected car concept

The connected car market—which includes everything from on-board safety systems to more sophisticated systems that interact with outside networks—is expected to reach $131 billion by 2019, according to the Transparency Market Research firm. TMR cites increased consumer demand, the rapid growth of network technology and increased connectivity as the main drivers behind the potential boom. Proponents of the technology say cars connected to the Internet would be safer, smarter and more fuel efficient. While some have cast a skeptical eye on the technology—privacy concerns loom large in the debate—the momentum toward an internet of things (or cars) is steadily building.

“The cars produce literally hundreds of megabytes of data each second,” John Ellis, a Ford technologist once told The Washington Post in the early days of the technology’s development. “The technology is advancing so much faster than legislation or business models are keeping up. . . . What can government do? What can you do?”

As the debate of privacy rolls on, advocates focus on what they say are the positive benefits of accepting the technology.

Intersections that contain connected car technology move traffic more quickly and safely, according to reports. Delays are reduced by 17 percent, the amount of gasoline a driver uses is lowered by 5 percent and CO2 emissions drop by 5 percent, Ben Collar, director of research and development for Siemens Road and City Mobility, told finance site MainStreet.com.

Automotive innovation could spur change in other sectors

For all these reasons and more, firms in the automotive industry and beyond are scrambling to get involved with the technology before it truly becomes mainstream.

AT&T in October announced it activated 1.3 million connected devices in the last quarter of the year, 500,000 of them in connected car features.

“This is huge news for AT&T, which has worked hard to forge partnerships with car makers like General Motors and Audi, as well as establish a developer platform called AT&T Drive,” the tech site Engaget reported. “The company says that this brings the total number of AT&T-connected vehicles to two million, which means that it increased its fleet by roughly thirty percent.”

In addition to transforming the mobile communications industry, the connected car could have major implications for the insurance industry as well.

“We have connected vehicles that do not crash that often and eventually autonomous vehicles that hopefully never crash,” Cisco 's director of smart connected vehicles, Andreas Mai, told The Motley Fool. “You need to reduce the risk premiums that we are paying with our car insurance companies. So, their business model is transforming."

It’s a familiar pattern: Innovation hardly ever exists without disruption. Many in the major manufacturing, development and technology sectors have embraced this fact when it comes to the excitement surround connected cars. The trend toward the connected car, along with the connected watch, the connected home, the connected phone and the connected everything else, is increasingly clear—and exciting.

As Collar told CBS News, "We are recognizing that our society is moving toward a more connected state.”

An Arabic translation of this article is provided here.