Telia Wants Driving Seat in Connected Car Biz
DUBLIN -- IoT World 2016 -- Telia's launch of connected car services this month represents the Swedish operator's biggest move into a new business area in about ten years, says Hans Dahlberg, the vice president of Telia Company's global Internet of Things (IoT) business.
That move, the significance of which Dahlberg likens to the launch of TV services, also puts the telco at the intersection of dealings between end users and car service companies, shifting Telia Company (formerly TeliaSonera) out of its traditional connectivity role. "We are helping companies translate data into new services -- there is a big difference between that and simply moving megabytes from one address to another," says Dahlberg during a conversation with Light Reading at this week's IoT World conference in Dublin.
The service, which is being offered under the Telia Sense brand, allows car owners in Sweden to access a range of connectivity and other services through Telia. After plugging a dongle into the vehicle, customers can buy connectivity packages and choose from a menu of services provided by Telia's enterprise partners. At the moment, there are just four, covering inspection, insurance, repair and roadside assistance, but the list is set to grow fast, says Dahlberg. Service expansion will also take in other countries in Telia's Nordic and Baltic footprint, he adds.
This is not Telia's first maneuver in the connected car space. Like operators in other markets, Telia has provided connectivity services for car makers such as Tesla, whose hi-tech vehicles have been described as "smartphones on wheels." But the entry into the "retrofitting" game is obviously targeting a much bigger addressable market with a different service proposition. "It is a double-sided business model -- handling the enterprise part and also addressing the end consumer," says Dahlberg. "This is the first time we see the value of data not only in terms of the communication of data."
Partners may see various attractions in working with Telia, besides a major channel to market. To deliver its service, the operator has teamed up with a software-as-a-service company called Springworks, in which it now holds a 30% stake. The startup's Spark-branded cloud platform underpins the entire offering and supports services like usage-based insurance and remote diagnostics.
Spark can also aggregate data from connected vehicles and feed this back to insurance and other companies, giving them information of considerable value to their businesses. "We are working with one of the big insurance companies in Sweden, and they reckon if they could lower speeds by an average of 3-4km/h they could reduce the number of collisions by 15-20% and road deaths by 40-60 per year," says Dahlberg. The company he refers to is Folksam, Sweden's biggest insurance provider, Light Reading has learned.
Telia has devised revenue-sharing models for different business cases, ranging from transaction-based schemes to ones based on subscriber numbers. Taking advantage of the Springworks technology, it can also sell customer data to its partners, provided the customer has given it permission. "An insurance company would pay a fee to the telco for the data they get, the customer would get a discount from the insurance company in return, and the insurance company could better align risk with driving behavior," explains Erik Ramberg, the CEO of Springworks. "It's a win, win, win."
Next page: Driving ahead