Connecting Car With Consumer Electronics Profitable, Critical
By William Diem WardsAuto.com, Aug 12, 2008 5:14 PM

TRAVERSE CITY, MI – Ford Motor Co. is getting an average $750 more on the hot-selling Ford Focus this year than last year, as customers downsizing for better mileage are demanding more features in small cars.

And a key element in the Focus’ better bottom line is the Microsoft Corp.-supplied Sync system.

For Ford, the Sync in-car connectivity is an essential revenue builder, says Jim Buczkowski, director-electrical/electronic systems engineering. Cars with Sync move off the dealer’s lot twice as fast as non-equipped vehicles.

Currently, 38% of Ford’s fleet can be equipped with Sync, and all of its ’09 models will offer the communications system.

Buczkowski says Ford’s decision to introduce Sync first on the Focus was highly strategic. The auto maker wanted to make the technology available to the greatest number of customers, employing the same thinking Henry Ford used with the Model T.

The Ford experience meshes with the general feeling in the connectivity business: new technology goes quickly when it grows.

Buczkowski: Sync essential revenue builder.

“In 20 years, we’ve gone from rotary telephones to what we have today,” says Paul Brubaker, an administrator with the U.S. Department of Transportation.

Cell phones grew from just a handful in the market in the early 1990s to 4 billion in use around the world now, and there currently are 180,000 antenna towers in the U.S., alone.

The general idea is auto makers will build cars that can handle rapidly changing consumer electronics, because the lead time for car development can’t keep up with the 6-month development time and 2-year average lifetime for consumer electronics.

“Our prediction five years ago was that cars would be de-contented” of consumer electronics, says Adam Drobot, chief technology officer at Telcordia Technologies Inc. “You can’t buy a cell phone from a car company any more.”

Drobot says auto makers have certain areas of the connected car that will remain theirs:

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“That spot that the driver sees in a safe spot on the console is owned by the auto industry,” and the power and antenna available in the car is more powerful than can be carried into the vehicle as part of a cell phone or other portable device.

But services aside from those related to security and safety will be handled more efficiently by other parties.

“The electronics industry has crossed a threshold of impulse buys – $300 buys a lot of capability,” Drobot says.

The infrastructure will be slower to build its networks of wired roads and bridges.

Michigan has conducted some experiments quickly, such as adding sensors to the Mackinac Bridge last year in a period of just three months. But there are limits to how much can be spent to wire an infrastructure. Michigan has 10,000 bridges, for example.

Experiments already are under way to bypass infrastructure investment by leveraging consumer electronics. In the SafeTrip-21 program being conducted in the San Francisco Bay area, the U.S. DOT and partners are using the moving signals from cell phones and PDAs to more cost-effectively paint a picture of traffic movement.