For this vignette of a recent episode of the Futurum Tech Webcast, Part of the 5G Factor series, analysts Shelly Kramer and Ron Westfall and examine the key trends in the 5G market assessing the market impact of the AT&T and GM alliance aimed at delivering 5G connectivity to GM cars in three years.
Their discussion covered:
- The market significance of the GM and AT&T partnership that is bringing 5G cellular connectivity to select Cadillac, Chevrolet, and GMC vehicles by 2024 as well as supporting GM models from 2019 and newer that are equipped today with 4G LTE to migrate over to the 5G network.
- Why the alliance heralds the democratization of connected car technology and applications, including the NVIDIA Hyundai partnership’s aim to bring 5G connectivity and advanced safety features.
- How 5G capabilities can make infotainment capabilities more flexible and safer.
- Understanding that the OnStar service connects about 60 million vehicles across US roadways today and how it can advance ecosystem-wide assimilation of 5G technology and features.
- How the Qualcomm acquisition of Veoneer further validates the connected car business case.
- Why Tesla’s vision of automobiles as computer on wheels is coming closer to fruition.
Shelly and Ron see the connected car segment gaining broader ecosystem support as the deployment of 5G networks accelerate and the expansion of major alliances assure broader adoption and interworking.
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Shelly Kramer: And with that we’ll move on to some other G’s. One of the things that caught my attention and that I wrote about this week was about the GM partnership with, AT and T on 5G cellular connectivity and I thought this was really fascinating. And I actually am a car person, it’s funny, I don’t know that I’ve always been that way, but I’m a car person now. And I’m really fascinated by the advancements in the automotive industry and what we’re seeing happening in some key partnerships. But speaking of this partnership, the GE and AT and T partnership, the companies announced that they’ll bring 5G cellular connectivity to select Cadillac, Chevrolet and GMC vehicles by 2024. And so that connection boost will impact faster navigation, better coverage, more reliable software updates, more rapid software updates for the in vehicle infotainment systems.
And also an interesting point, is that GM models from 2019 and newer that are equipped with 4G LTE will also be able to migrate to the new network infrastructure. So I think this is really important for a couple reasons. One is, I think that we’re seeing the democratization of connected cars. And we talked about this earlier before this show started, and I drive a fancy luxury car and probably, this is actually the second luxury car that I’ve had that’s been pretty connected, but this one is even more connected. And I drive a 2020 Mercedes and as I was telling Ron in our earlier conversation, I don’t think I could run into anything if I tried, because the car is equipped with so many safety features that it literally shuts down if it senses me getting too close to somebody, or if it senses me backing up and there’s something in the way, and this is really, really interesting.
And then of course, once you get used to those safety features, or if you drive a vehicle like a Tesla, and you’re used to getting software upgrades through the internet, right? All of a sudden it seems so backwards to be driving a car that doesn’t afford that safety and those luxuries and those easy updates. And so I wrote last year about a partnership between Hyundai and Nvidia that will enable Hyundai to bring connected vehicle features, the top of the line connected vehicle features to its entire fleet in about this same time period.
So I think what we’re seeing is car makers embracing the IOT, embracing 5G, embracing all things that contribute to the connected car ecosystem and I think that’s a good thing. And I think that what this announcement signals of course, is AT and T’s belief in their 5G network and that it’ll be ready to handle millions of connected cars by the end of 2023, when those 2024 models are released. And so I think we’re going to see some impressive growth there. Ron, are you paying attention at all to the whole connected car and 5G driving this innovation there?
Ron Westfall: Oh, you bet. I’m like you Shelley, I’m a car lover. And so I think one reason why the major carriers are promoting their collaboration efforts and the automotive side is, because almost everybody is interested in it, so a great way to promote your wares. And I think it’s important that it really is when it comes to 4G, 5G connectivity, mostly about enabling the infotainment capabilities. For example, I have an older model Honda Odyssey, and the infotainment is really a DVD player. And that’s a hassle to have to switch those out and you have little kids in the back and they’re clamoring for, “I want to watch Despicable Me instead.”
Shelly Kramer: Right.
Ron Westfall: So it’s almost you have to pull over if you really want to be safe about updating that. And what I think is definitely exciting about the 5G connectivity capabilities, is just having that flexibility to do video streaming to the infotainment system, having just more flexibility on the computer screen and so forth. And I think that will be welcomed by everybody, it’ll make cars safer, it’ll just give people more options to entertain the backseat drivers, especially on long distance driving. So this is just I think a good example of the ecosystem coming together and improving these capabilities.
I also think it’s important that when you look at suppliers on the Silicon side, like Marvell, I think they’re definitely advancing what could be called ether networking for the automotive sector. So instead of legacy proprietary inner working, which can make the cars more expensive, they also quite simply can be complex to ensure it’s working. By using ethernet networking principles are already universally applied and offices and so forth. To automobiles, I think we can see even more advances in terms of these capabilities. So that’s a great example of different technology trends coming together to fulfill that vision of the automobile becoming much safer, becoming just smarter more agile and so forth. So it’s a thumbs up.
Shelly Kramer: And I think that our conversation here over the course of the last couple of minutes has focused on consumer vehicles, but they’re huge applications that this new level of connectivity brings to fleets and fleet management services. And when I was writing this article about the GM and AT and T partnership, one of the things that GM’s VP of global connectivity, Santiago Chamorro mentioned, that their OnStar vehicle service connects about 60 million vehicles across US roadways. And so enabling that 5G access, the 5G network for strategic partners will play a big role in growing other mobility services and things that we see in smart cities of the future. And that future is this far away, it’s not really a long time away. So I think that was really exciting.
And also, our team in general is, we look across the industries as a whole and trends. And I mentioned Hyundai’s partnership with Nvidia and what Nvidia does, is really allows powers that connected car operating system across the entire Hyundai fleet using NVIDIA’s drive platform. And this is really a focus on extending a software defined connected car experience and bringing the very best in driving, which I think is really cool. And some recent news that our colleague Daniel Newman wrote about too, was watching what Qualcomm’s doing in the automotive industry. And they’re doing some pretty significant things and we expect that to be even more significant in the coming months.
Qualcomm’s recently pursued Veoneer, which is a developer of full stack automotive technologies, including safety systems like radar and vision systems and driver monitoring systems and all different technologies, also autonomous driving features and restraint controls. And so we don’t know yet what’s going to happen with Qualcomm’s bid to acquire Veoneer, but we are certainly watching that with anticipation, because what it does show us, is that Qualcomm’s ambitions and strategy and strategic focus in the automotive industry, is significant and certain to get even more significant over time. So I thought that was pretty interesting in terms of what’s going on for car people.
Ron Westfall: Yes. And I think it’s important to note that a lot of the vision, certainly advanced by Elon Musk with the whole Tesla offering, is that automobiles are increasingly becoming computers on wheels. And so I think this is aligning with fulfilling that vision and overall its good news, because again, it’s just making these built-in capabilities safer. And a lot of it really is coming down to on-board computing. Yes, there will be role for 4G, 5G connectivity for infotainment, but there’s still, I think a little confusion that, oh, if you have an autonomous car and it’s relying on sensors embedded throughout, an urban grid.
Shelly Kramer: Yeah.
Ron Westfall: And if one of those sensors doesn’t communicate, the car will suddenly shut down and cause an independent set of accidents, well, that’s not what it’s being pursued here, not at least in the foreseeable future, that would be much further out. And it would be for selective capabilities like fleet management, not individual cars.
Shelly Kramer: Right.
Ron Westfall: And so we can’t get too far ahead of ourselves. We really have to focus on when it comes to the 4G, 5G connectivity capabilities, it really is a specific set of technical features. And it’s not a comprehensive car capability that is going to be offered anytime soon.
Shelly Kramer: Yeah, absolutely.