Telematics: Boon or Bust?

You've heard the old saying that men will always refuse to ask for directions, no matter how lost they are. Now, there's a new take on it. According to a recent study conducted by eBrain Market Research, men are the prime targets for the new in-car navigation and information systems. You can draw your own conclusions from that, but apparently, while many men seem reluctant to go into a gas station to ask for directions, they are willing to get directions from an in-car device that uses a combination of Global Positioning Satellites and computerized mapping. But what does this mean to the mobile information industry?

If we are to take the word of the recent eBrain study, mobile navigation and information systems (also known as "telematics devices") are poised to enter the mainstream as consumers increasingly come into contact with this burgeoning technology. Helping to drive the predicted surge in telematics are potentially lower prices and higher consumer exposure to the products. Perhaps like other recently unveiled consumer electronic products, like high-definition television, for example, relatively few people own them, but a lot of people have heard about them.

In spite of very low ownership rates, nearly nine out of 10 automobile owners are aware of telematics devices, largely due to word of mouth and exposure through rental car agencies and third parties. Exposure to computer navigation systems in rental cars has been extremely important in getting the word out, since a very small percentage of the driving public has opted to pay the $1,500 to $2,000 additional price to have a factory navigational system installed in their vehicles. One has to believe that $2,000 will buy an awful lot of paper maps, which offer the additional convenience of being easily portable. (Imagine pulling your sedan into the living room so you can plan the route of your next trip.) Further, while the utility value of navigational systems varies widely from brand to brand and even model to model, some still cause significant amounts of user frustration.

A case in point is our recent exposure to the nav system in a new Infiniti I35. The system had what IT folks would call a confusing interface. It was slow to respond, and its joystick controller seemed almost disconnected from the unit at times, while at other times it seemed much too sensitive. Perhaps worst of all, this Infiniti's system was configured to prevent destination data input (picking the place you want to go) while driving. At first, this might seem like a reasonable safety feature, but consider this: in our test, it didn't just prevent the driver from using the device, it also prevented the front-seat passenger from using it. We don't know how you feel, but we don't think there is much advantage to a system that requires the car to be in "Park" before some of its functions can be brought into play. On the other hand, telematics in rental cars, which seemed to designed with a weather eye on easy familiarization, are exposing more and more people to the technology.

"Such high awareness, along with increased interest in mobile navigation systems bodes well for manufacturers," said eBrain's director of research, Tim Herbert.

While only three percent of U.S. households actually own a vehicle equipped with a telematics device, 14 percent of car owners familiar with the product have used one. Nearly 75 percent of those who have tried telematics did so on a car other than their own, including rental vehicles. Among those who have used telematics devices, the reaction is overwhelmingly positive. Some 83 percent found the product to be "very or somewhat useful."

"This is very encouraging news and points to the need to get more individuals to try these devices," said Herbert. "The key to increasing sales may be to get consumers to try one at various public events, especially those where the target market may be concentrated."

According to the survey, telematics users are more likely to be male, aged 18-34, highly educated, have household incomes above $75,000 and have access to the Internet. Among the many features offered by the technology, consumer interest is largely driven by increased safety features such as the ability to send distress signals, monitor car maintenance, traffic information and the ability to obtain maps. The "Mobile Telematics Interest and Awareness" survey was fielded via telephone to a random national sample of 1,000 online adults during September 2001.

Call him old-school, but auto journalist Luigi Fraschini would rather make do with a compass and a paper map than a GPS navigation system.