ConGHughesed

"ConGHughesed" is intended to be a play on words. I had a fraternity brother in college who used to wear a shirt with "GhOTi" on it, and he was so proud that if you said it correctly, his shirt read "fish". In that spirit, the title of my blog is intended to be a bit of double entendre- both "confused" and borrowing from Latin ("con" meaning "with") (and another tribute to my high school Latin teacher), my blog title "With Geoff Hughes".

Life can be confusing but maybe together we can share some big thoughts and ideas that make life less confusing and more interesting.

There are a variety of topics of interest I will write about, including cars, beer, wine, books, skiing, Duke basketball, and I'm sure other things over time.

Its important to understand that these opinions are my own, and not those of my employer.

Welcome, I look forward to a fun collaborative dialog!

Geoff

Monday, January 18, 2010

The intersection of auto and personal technology

Automotive interior design is now a powerful market differentiator and a compelling part of our driving experience. The recent announcements about Ford enabling wifi, and social media services (twitter, etc) in their new product lines got me thinking about what technology I want in my car. I have a great car, an Audi, and the lease is due in the near future. The one flaw in my Audi is the iPod "integration". Audi's idea at the time I leased my car was to leverage the ipod as a second CD changer- disks 7-11 being the first 5 playlists on the iPod and disk 12 being the entire song list. This is a completely cumbersome and inefficient way to listen to music. Audi is recognized as a thought leader in automotive design, so it is a surprise that Audi failed to understand how poor this ipod interface is. My understanding is that the ipod integration in newer Audis may be more user friendly. Auto manufacturers have continued to evolve their product line in such a way that outside of significant expense, there is no practical way to customise your vehicle's interior. Look at most new car dashboards and center consoles. Don't like your factory audio system? How many people today are going to rip out the factory stereo and replace it with an Alpine? Not many of us are getting invitations to "Pimp My Ride".

While far from authoritative, a quick google search indicates that the average cost of a new car checks in around $29k, and the average time an American owns his or her car is about 6 years. An undated JD Power survey suggests the average length of cellphone ownership is less than 18 months. This difference in time of ownership is the crux of the entire problem- do we as consumers want to trust an absurdly change resistant automotive industry keep pace with the rail gun acceleration of changing personal technology?

This brings me to the title conundrum- the intersection of auto and personal technology. Let's take GPS navigation as one example. You can buy a respectable brand name GPS receiver (like an entry level Garmin Nuvi) for around $100 from Amazon. A base trim Honda Fit costs around $15k, and in order to get a navigation system, the MSRP swells to around $19k - an over 25% price increase, and a real dollar cost increase of $4k. Now, absolutely, the navigation system itself does not cause the sole price increase, but in the Fit, you cannot get an integrated navigation system any other way. For sake of illustration, lets assume that navigation system is $1500 of the difference between the base and top level trim cost. Navigation on a Lexus IS is a $2500 option, and $2100 for a BMW 3 series, so $1500 seems like a reasonable assumption for our Honda Fit example.

Even if you break your toys all the time and you have a frightful habit of misplacing gadgets , you could afford to replace your non-integrated entry level GPS 15 times over six years. As a side benefit of being a butterfingered and forgetful person, you would take advantage of trickle down technology where the GPS system of 6 months ago has now decreased in price and you get better feature/functionality for your money, not to mention the fact that the money you kept in your pocket should earn you some interest, to boot.

Are there some advantages to integration? Yes, of course! In the case of a navigation system, you get a larger screen, possibly some other bells and whistles like Bluetooth phone integration, and speech recognition. All these features would be found on more expensive standalone GPS receivers, but still be significantly cheaper than the assumed initial cost of the integrated car GPS.

Take another example outside the automotive industry. Whether desktop or laptop, 6 years is now a long time to own a computer. Even if you bought a state of the art PC, at some point, you run out of memory and CPU cycles, hard drive space, or even compatibility to run the latest operating system from your vendor of choice. To deliver internet based services in your car, auto manufacturers essentially have to install a PC equivalent somewhere in your vehicle. Will this PC be user servicable? User upgradable? User replaceable? Will you have to drive your car to the dealer for operating system upgrades and patches? Will the car be smart enough not to do an upgrade while you are driving if it interfaces with safety systems? Will your car ever need a reboot? What if your car gets a virus?*
[*side note: yes, there are cars running MS Windows already, and have been for years- notably BMWs with iDrive, and Ford's SYNC among others. Some of these questions are indeed tongue in cheek.]

What this integration of personal technology in your car will lead to is technology lock in. This is clearly an advantage for the manufacturer, and a disadvantage for the consumer as technology obsolescence sets in. Do auto manufacturers think technology lock in is what consumers want?

I see three potential solutions to the issue (aside from the obvious " keep the technology out of my car!" answer). The first is an answer that will reinforce current American consumer habits - leasing. If you lease a car for 3 years, you keep yourself within the range of your technology being current and non-frustrating. Going back to the Honda Fit, that $1500 navigation system adds around $42/month to your lease. Honda's website suggests the monthly lease is $395/month, so the navigation system is about 11% of that monthly cost. Which is more appealing- a $42/month cost hidden in your monthly car payment for three years or an up front top of the line $500 GPS? Or a basic GPS and $400 to save or spend elsewhere? The base Fit with automatic transmission is an estimated $320/month lease, so spending $100 on a non-integrated GPS will save you $75/month (probably enough to pay your monthly gasoline bill) or $2700 over the 3 year lease.

The second, better answer is an option that auto manufacturers would resist. Modularity, or at least upgradable technology would allow consumers to buy the car they want and keep feature current with changing technology. After all, how many people can afford (or would want to) buy new cars at the same rate as cellphones, GPS receivers, or PCs? Would you pay an extra car payment a year for the automotive equivalent of software or hardware upgrades to enable new features?

The third, possibly ultimate answer that builds on modular, upgradable technology and is a win for both consumer and manufacturer would be to have the services available to the car but kept outside the car itself. Yes, I found a way to integrate "cloud services" into a discussion around cars (apologies to my colleagues in the server, storage, networking and virtualisation arenas!). The right way to integrate personal technology into a car would be to leverage a platform that would enable the services you want to be available, and give you options to stay current. There are similar models in existence today- think Nintendo Wii updates, networked Blu-Ray players, Sony's PS3, or even the Roku box that streams content from Netflix and Amazon. This platform can also represent an ongoing revenue stream for the automotive manufacturers, much like a subscription to OnStar does for GM today.

Automotive design engineers, I want my music (including my ipod or mp3 player of choice) to easily integrate with my car, or have a user friendly delivery mechanism. Other technologies that could lead to distractions (WiFi, social media access, etc) should have a "drive time" lock out, or be configured in such a way that the services are available to passengers but not the driver- there is a really cool dashboard screen in the 2010 Land Rover that shows different information to the driver and front seat passenger based on viewing angle- that is some cool technology.
Check out http://www.automotive-access.com/two-images-on-one-screen-using-parallax-by-land-rover/

What do you think about the intersection of automotive and personal technology?

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