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M2M Services

Sprint Insures Its Spot in the Connected Car

Sprint is looking to secure its spot in the connected car by first securing its customers as they drive.

The carrier announced new additions to its usage-based insurance offerings on Tuesday -- a product to disable text messages when a wirelessly connected vehicle is in motion and premium add-on connected services such as vehicle diagnostics, trip reports, and accident detection, as well as voice-powered "infotainment" options such as Internet radio and social media.

Sprint Corp. (NYSE: S)'s machine-to-machine (M2M) technology, as part of its Integrated Insurance Solutions portfolio, also gives insurers and policy holders analytical data about their customers' driving behavior. Bill Faresich, senior product manager for usage-based insurance at Sprint, says the carrier provides the devices, telemetry, and cloud-based backend system for driver scoring, customer fulfillment, and customer care. It's too much for the insurance company to do alone, he says. (See Big-Data Is Key to Consumerization of M2M.)

"We've taken the devices and logistic support and tried to make it a turnkey offering so a lot of small/medium insurance companies don't have to reinvent the wheel," Faresich adds. "They aren't good at supporting devices, and they don't know about telematics."

While there are several apps on the market that disable texts at the user's command, Sprint's text disablement product, built with partner Modus, is a device that plugs into the car's on-board diagnostic port (OBDII). The device blocks the driver's phone from sending or receiving text message or using data at all while in motion. It can also alert parents when their teen driver goes beyond a pre-set "geofence."

Like all the mobile operators, Sprint is keen on building partnerships in the automotive industry. Its approach, however, isn't centered solely on connectivity. Rather than looking to embed 4G in every car on the road, it wants to act as a systems integrator tying cloud-based services to the car. Sprint's Velocity platform, launched in 2012, is its complete system built for automakers to integrate and customize as they wish, including Sprint's LTE network -- or another if they so choose. (See If These Cars Could Talk.)

Sprint's after-market products, on the other hand, only need Sprint's 2G network to transmit around 2MB per month. The insurance division is separate from Velocity, but Faresich says the two could soon merge as the carrier collects in-car data to submit to insurance companies.

Telematics, along with fleet management, is one of the biggest vertical focuses for Sprint's M2M practice. According to Current Analysis , Sprint has around 3.3 million connected devices as of the second quarter, making up about half of its wholesale and affiliate connections.

— Sarah Reedy, Senior Editor, Light Reading

pdonegan67 9/3/2013 | 12:38:44 PM
Auto industry's engagement in early 5G dialogues There's evidence of the auto industry now engaging at a much earlier point in the development of standards for Next Gen connected car technologies. BMW, for example, is already engaging in drawing up requirements for 5G, for example.
Sarah Thomas 9/3/2013 | 9:29:02 AM
Social Media In terms of what social media in the car could look like, Faresich says it could be competing to get the best driving score against friends or to have the greenest vehicle. I think a lot of these programs are aimed at teen drivers who might be interested in connecting in that way. If it helps lower their insurance, I'm sure that's a plus too.
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