10
Sep
2020

5G Paving the Way for Cars with Embedded Connectivity

POSTED BY Sam Barker
A new study from Juniper Research has found that the number of vehicles with embedded connectivity will reach 200 million globally by 2025; rising from 110 million in 2020. As a result, we predict both 5G adoption and the incorporation of embedded eSIMS will be a catalyst for this growth; making operators some of the main beneficiaries of this new trend.

With remote and flexible working, the car has become an office, as well as a transportation device, and both driver and passengers expect to have all the office requirements and home comforts in a mobile setting. This includes reliable connectivity, entertainment and communication. Furthermore, users are expecting accurate and reliable advanced safety feature, which in turn demands more technology to be built into cars. And this where 5G comes into play.

Although existing network infrastructure already plays a key role in the automotive sector, operators need to be able to leverage the existing technology and move toward supporting V2NI (Vehicle-to-Network-to-Infrastructure) communication: indirect communication between a vehicle and a roadside infrastructure via the cellular network and IT infrastructure. 

At present, mobile operators are mainly delivering automotive services that tolerate some latency such as off-street parking information, traffic information and smart routing. Services that may not be delay-tolerant are delivered using cellular communication over V2N2i or short-range communication over V2I. These include hazardous notification such as roadworks warning.

This is all likely to change with the wider 5G roll-out, which provide low-latency communication and hence faster notifications; allowing mobile operators to be more and more involved in the automotive industry. If premium automotive brands, however, are pushing to introduce 5G at the earliest opportunity, OEMs are reluctant, and we predict that they will only introduce 5G technology when necessary. Therefore, we believe that 5G implementation will start in 2021.

For this reason, operators must not abandon investment into 5G until it reaches LTE levels, and, together with OEMs, they will need to work out effective pricing and bundles for customers, considering new emerging ways of ownership and use of vehicles, such as car-sharing, multi-transport subscription services and Mobility-as-a-Service. Wireless operators will need to bear this in mind, in order to successfully incorporate these trends into the planning of car connectivity solutions and turn 5G into a steady revenue stream.

Our latest whitepaper, Connected Cars: Fuelling Operator Revenue, highlights the disruptive role that 5G will have on the automotive industry, as well as discussing potential challenges and implementation strategies.

Download the whitepaper: Connected Cars: Fuelling Operator Revenue
Related Research: Operators & Providers; Mobile Operator Business Models; In-Flight Entertainment & Connectivity; Direct Carrier Billing; Edge Processing in IoT; Robotic Process Automation in Telecoms; AI Strategies for Network Operators;