Microsoft is planning to use its vast trove of patents and intellectual property to make itself a major player in the connected car market. Toyota, which is already investing billions in the technology, is the first auto maker to sign up.
In a March 22 blog post, Erich Andersen, corporate vice president and Microsoft's chief IP counsel, writes that Redmond doesn't want to build connected cars itself, but plans to entice automakers of all kind to use its technology by licensing out patents, including ones for Cortana -- its digital assistant -- artificial intelligence, operating systems, sensors and security.
"We don't make cars, but we have a long history of working with our partners in the automotive industry to deliver great products and services that power the automotive sector," Andersen wrote in the post.
In a report, Allied Market Research puts the connected car market at $141 billion by 2020, which translates to an compound annual growth rate (CAGR) of nearly 33% between 2014 and 2020.
Microsoft, like many other tech companies, is trying to partner with traditional automakers to grab a slice of this pie.
While Microsoft is focusing on patents, Intel is using cold hard cash to move into the connected car market. Earlier this month, it bought the Israeli firm Mobileye for $15.3 billion, and the chip maker plans to blend its cloud computing and data center technologies with that company's sensors and on-board cameras to make autonomous driving safer and more efficient. (See Intel, Mobileye $15.3B deal has cloud under the hood.)
Other tech firms are eager to jump on the bandwagon as well. Nvidia and Bosch are building a new connected car platform that will use AI to help cars and vehicles drive themselves.
Microsoft has been using its patent portfolio in interesting ways over the last few months. In February, the software giant announced a program called Azure IP Advantage, which allows the company's cloud customers to use its intellectual property to fight off patent trolls. (See Microsoft Azure Offers Patent Troll Protection.)
Toyota was also one of the first customers to sign up for that program as well.
By getting into the connected car market, Microsoft opens opportunities for a range of its products and services. For example, if Microsoft is supplying connected car technologies, why not use its Azure cloud platform to collect, store and later analyze all the data the vehicle collects? The data is then beamed back to the car through Cortana or another interface.
The patent program can also place Microsoft at the forefront of the Internet of Things, since much of the data will be picked up by sensors and other devices within the vehicle.
Microsoft has been trying to ingrain its technology with cars since 1995, most famously with the Ford Sync. It's also worked with Tesla and Nissan on different vehicle projects.
The full list of patents that Microsoft is offering includes: operating systems, file storage, connectivity, sensors, gesture computing, graphical user interface, voice recognition, multi-touch, security and AI.
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