Schmidt was in Australia and gave iTWire an interview on a wide range of telematics (computer remote monitoring) and traffic trends.
TomTom Telematics is primarily for commercial fleet use but since Schmidt sold his Datafactory AG to TomTom in 2005 he has seen telemetry used much more broadly than fleet reporting and management.
In Australia alone, he said, more than $3.37 billion was lost annually due to traffic congestion in cities like Sydney, Melbourne, and Perth, according to the TomTom Traffic Index 2017 and analysis conducted by TomTom Telematics. Compared with driving in non-congested conditions, vehicles spent 25% more time on the road. The figures are conservative as many (commercial) drivers are paid more than the minimum wage.
Q. Can you tell us about TomTom Telematics?
You all know TomTom for its personal in-car navigation devices but it is much more than that – I am going to call it a “product stack”. We have the only independent global street mapping division (after HERE was sold to a group of automotive manufacturers and Google owns Google Maps).
We have a traffic detection system that is so much broader than just SUNA or government traffic.
We have telematics software and hardware, and we have enormous experience plus a wide range of products and services supporting the development of autonomous vehicles and the high precision needed to keep them safe and on the roads.
So, we have a product stack that works well together.
Telematics is the business-to-business division of TomTom and has been operating since 2005. It specialises in telematics, vehicle tracking, navigation, two-way communications, job scheduling and report logging capabilities for commercial fleet users.
Its software comes as a Software-as-a-Service (SaaS) platform. More than 46,000 customers with more than 700,000 vehicles use it already and these numbers keep growing fast.
A small black box (telematics unit) is installed in the vehicle to collect telemetry and it communicates via 3G to the software. The driver has a choice of a 5” touch screen device or a 7” tablet depending on their needs like a camera, communications, etc. These are secured via a mobile device management (MDM) platform.
Q. Isn’t telematics a little intrusive for the driver?
Some of our competitors suggest it is the sheriff who enforces good behaviour, but let me tell you it is so easy to get around the rules.
TomTom takes the opposite tack – we take a friendly approach that makes the driver totally comfortable with us. There is no big brother watching, just friendly advice to help them do their job easier and better. We even give things like coasting advice and other driver hints. It may be simply a state of mind but our approach works better than the carrot and stick.
The benefits are lower fuel consumption, better route management (no doubling back) and happier customers who know when you will deliver (as we mix traffic reporting with location and do know when you should be there).
It is very easy to sell the concept. A proof of concept (POC) uses existing, pre-telematic, statistics and we can show where these can be improved. If it does not deliver benefits, then it is equally easy to uninstall as install.
Q. Is Australia a good market?
Australia is a big country, there is a lot longer distance freight, and a lot more congestion in capital cities — $3 billion is wasted due to traffic congestion — so, yes, it is a great market.
At present, Australia has an estimated market penetration of 20% for telematics solutions, but that is way lower than other developed countries.
Q. You mentioned being able to tell a customer when the freight would arrive.
In the past, you had to wait around or nominate either AM or PM for a delivery – very inefficient. With Telematics, we can improve the customer experience by automatically sending a text with realistic delivery times, once the driver is on the road.
The key to any business is improving the customer experience and for this reason, a lone van, local delivery drivers, and large fleets are looking at telematics, especially our cloud-based, subscription model.
Q. You mentioned connected cars – how involved is TomTom?
As a group, TomTom is transitioning up the ladder to a very strong position as we have the whole product stack. We are leaders in precise mapping down to five centimetres (traditional GPS could be 10 metres) – it Is called High Definition mapping. We are the only independent supplier of that. Our software is also helping to predictively manage the vehicle.
Let’s call it collaboration with major car makers, Microsoft Azure, Qualcomm, NVIDIA (graphic processors) and others to create an open environment that will take this forward faster than the closed automotive environment, which often takes about five to eight years from concept to production of a new car model.
We have the essential components, patents, knowledge, and skills to transform automotive mobility.
Q. Could the technology for autonomously driven cars be retrofitted?
Not really. Some modern cars have the sensors, but most do not. There is a difference, however, between an autonomous car and a connected car and the latter can be retrofitted more easily.
But I question if there is a market for connected private cars e.g. adding Wi-Fi Internet and some telemetry because the economics don’t stack up. There is no return on investment and you can buy a simple 4G dongle to get the Internet now.
In a fleet, telemetry pays because there is a return on investment in six-to-nine months.
But that does not mean TomTom won't develop low-cost devices – 40% of new cars are in fact owned by car-leasing or car-rental companies. They are interested in having a direct relationship with the car/driver and having telemetry to provide things like usage-based insurance.
Telemetry could lead to more bespoke insurance plans, even allowing the driver to shop their telemetry around for the best deal. We are calling that a TomTom Driver Score and insurance companies are beginning to know what that means in terms of driver risk.
Like all technology, Moore’s Law will eventually produce a crossing point where it is viable in private vehicles.
And that applies to the software too – we have opened up a range of APIs that developers and others can use to integrate TomTom Telematics into their software, ERP, accounting and more systems. It is leading to an explosion of scalability and connection with computing devices and peripherals that are enabled by the cloud.
TomTom does not formally have an app store but it does have a Web-based marketplace that lists what developers are doing and what additional software they have to offer in combination with TomTom Telematics. This is leading to some interesting global introductions and unique solutions for businesses.
What is going to happen in the next 5-10 years for telemetry?
Let’s focus on fully automated cars. In five years, they will be common on the roads and public acceptance will be growing.
In 10 years, they will likely occupy a significant part of the car park as people give up private car ownership. Your car will be an app and a fleet of autonomous vehicles will service your mobility needs 24/7.
In Australia, due to long distances, fleet telemetry is a no-brainer and we see a massive uptake by both small van and large interstate haulage operators. That is going to pave the way for autonomous trucks doing delivery where the driver becomes the human link.
Q. What are your parting messages to iTWire readers?
- It is an exciting journey – we are transforming mobility as we do it for both the consumer and the fleet operator.
- We need to be innovative if this is to succeed. That is not to say the automotive manufacturers with their inherent safety and systems won’t get us there eventually, but we think the open structure we are part of is better for attaining velocity. It is far more innovative and scalable than a proprietary solution.
- If you don’t do telemetry from a driver focus, then it will fail. It needs to be a valuable driver support tool (until autonomous vehicles take over).
- The whole thing must be easy to use. Complex systems requiring constant intervention will fail.
- TomTom is very open and collaborative. Its ecosystem, software, and hardware are not proprietary and encourage innovation, bringing a lot more value to customers than closed systems.