Vehicle Data Has Value
Finally, a value is being associated with the data coming from the ever increasing number of connected vheicles on the road. Andreas Mai, director of product management at Cisco Systems, Inc. has placed that value of data generated by a connected vehicle at a cumulative total of around $1,400 USD per annum. Put into perspective that might approach $7,000 over five years and possibly a whole lot more if one considers the average age of vehicles in operation today, which by the way is 11.4 years.
Despite the reality that there are certain privacy issues (and standards) to be ironed out along with the overarching question of who owns that data, my vote goes to the driver, to be resolved, four specifc categories of savings and earnings are called out.
1. Motorists can utilize the data their vehicles generate to save about $550 a year, with increased fuel economy, taking advantage of traffic re-routing and saving time stuck in traffic and with lower insurance rates based on where the vehicle is operated.
2. They can also save a whopping $420 per year by using technology and data to car pool with a resultant decrease in road capacity utilization.
3. Service providers can earn about $150 per year by providing guidance and navigation, parking, toll and emergency services.
4. And auto manufacturers can save $300 per year in lower warranty costs and with other profitable apps delivered.
Certainly there are real opportunites across the universe of drivers for the first three points…but the really intreaguing one to me is that of warranty savings and consequently quality improvment. Using data from the vehicle to compress the latency of a warranty claim, recognizing faults at the instant of occurance and begining the data analysis necessary to understand the failure and conditions surrounding that failure can lead to tremendous quality improvements and resultant cost savings. And being able to predict, based on real-time or near-real time data, can save further dollars by moving to fix small problems before they become bigger problems with more collaterial damage and customer frustration.
And any savings in warranty reserves can drop straight to the bottom line as profit. This is tangible and it is possible today. And there are further savings and revenue growth possibilities as quality and service are improved based on the volume of operational data. Mai indicates that 74% of morotists are willing to share vehicle information, if they get a benefit. This should be a no brainer!