In late April, the Senate Transportation Committee in California voted not to approve legislation that sought to provide consumers with clear notice that their vehicle had an embedded telematics system and that it was transmitting information to the vehicle manufacturer. The bill further sought to provide car owners with the ability to direct information transmitted by the telematics system to entities other than the vehicle manufacturer. The vote in the committee (three yes, one no and seven not voting) reflects not so much opposition to the issue of car owner privacy or competition in the auto care industry, but more to the fact that few legislators really understand the issue. Unfortunately, the absence of awareness of the impact of telematics both on car owners and competition is not confined to just legislators. Most car owners and likely even many in the auto care industry are unaware that vehicles are increasingly becoming equipped with telematics systems and what kind of information is actually transmitted to the vehicle manufacturers through these systems.
The ability for car companies to constantly tap into the vehicle’s on-board computers will provide a treasure trove of information regarding how a vehicle is driven, mileage, location, diagnostic fault codes and if it has been in an accident -- all in real time. Armed with this information, the car company and their franchised dealers will have the ability to develop more accurate models that predict possible component failures, improve and expand customer services, implement more targeted marketing campaigns, develop more efficient supply chain systems and more quickly respond to roadside emergencies, to name just a few. While independent auto care facilities could also benefit from access to this data, currently the car companies control access to the embedded telematics system, meaning they have a significant amount of power to determine who benefits and who does not benefit from telematics.
Some vehicle manufacturers realize that the more service they can provide to their customers will make their vehicle more desirable to potential customers. These manufacturers have provided “kits” to companies looking to build an “app” for the vehicle. The kits provide information on the vehicle’s telematics system such that an independent company could integrate their app into the embedded telematics system. This initiative is pretty smart for those manufacturers, but it is important to remember that the car company still maintains control of who can obtain the kit and who is approved to provide an app for their vehicles.
The bottom line in this debate is control -- should it be the car company or the car owner? In my opinion and that of the Auto Care Association, it is the car owner that should decide where their data is sent. However, this is easier said than done. At the current time there is really no technical method for a car owner to determine where data off their system can be sent. Working with a task force that is comprised of a host of trade groups and companies, the Auto Care Association is attempting to address the technical barriers to open access to embedded telematics. However, this is not easy task and there are some significant challenges including how to protect certain safety-related vehicle systems that, if hacked, could pose a danger to the motorist. Further, once a standardized interface is developed, the car companies are going to need to adopt the standard in order for it to be effective. It is unclear at the present time how likely it will be that car companies will cede full control of their systems.
This all brings me back to the vote in California. While the effort by AAA of northern and southern California has certain raised the profile of this issue, more needs to be done to educate car owners and legislators on this important issue. Second, it is important that the industry, hopefully that includes the car companies and the auto care industry, cooperatively develops a standard by which non-car company entities can obtain access to a vehicle’s embedded telematics system with the permission of the car owner. Once this standard is developed then it will be up to the car companies as to whether they will adopt the standard. While it is possible that control of access to data sent via telematics systems will become a legislative issue, pitting consumers and the auto care industry against the car companies and the dealers (sound familiar?), I hope that the car companies will see the writing on the wall and work toward ensuring that their customers have control of the data being sent by their system and the right to determine if and where that data is sent.