Study Shows Telematics Becoming $8 Billion Biz By 2005

Staff On Nov 6 2000 - 8:00am

OYSTER BAY, N.Y. -The telematics industry stands poised for tremendous growth and will be one of the most lucrative segments of the intelligent transportation systems (ITS) industry, according to a new study from Allied Business Intelligence.

The global in-vehicle information system (IVIS) market for personal vehicles will rise from $1 billion in 2000 to more than $8 billion by 2005. The recurring annual revenue for IVIS services alone will account for more than $3 billion of that 2005 total.

"2001 will be seen as the year that IVIS takes off," said Allied analyst Frank Viquez. "Several factors will drive this growth in telematics. Many firms were taking a wait-and-see attitude with IVIS. The pioneer efforts of GM's OnStar and ATX Technologies established the validity of the industry, and starting next year, several large new players will enter the marketplace.

"To further drive the industry, new IVIS services will also be introduced next year, such as hands-free speech recognition, satellite radio and Web-based services-such as weather, news, stock quotes and truncated websites."

With a projected 1 million combined subscribers between OnStar and ATX Technologies by the end of 2000, a viable market has been established. Starting in 2001, new entrants such as LoJack, the American Automobile Association and Wingcast (a partnership between Qualcomm and Ford Motor Co.) will initially roll out basic IVIS services.

Other intelligent transportation applications-including radio data system traffic message channel, radio frequency identification, fleet management systems, in-vehicle navigation systems, in-vehicle computing, collision avoidance systems and adaptive cruise control-are also rapidly gaining momentum.

The global commercial fleet-management market, for example, will grow from the current level of $1 billion to $3 billion by 2005

As these intelligent transportation system applications continue their assimilation into the vehicle, the need for a plug-and-play market becomes inherent, and sets of standards will be put in place by the end of 2000.

The report from Allied Business Intelligence is titled "Intelligent Transportation Systems: A Strategic Analysis of Global In-Vehicle Information, Navigation, Communications and Roadside Technologies." Details can be found at www.alliedworld.com or by calling (516) 624-3113.

* Includes home radios.

**Includes shelf, rack and home-theater-in-a-box systems.

Source: Consumer Electronics Association, Arlington, Va.cTWICE 2000