Tech giants scramble to tap internet solutions for cars

Tech giants scramble to tap internet solutions for cars

Staff Reporter 

2014-01-29

In line with a global trend among international auto multinationals, Chinese enterprises are scrambling to invest in car-related internet technology, attracted by the emerging market’s huge potential.

Following in the footsteps of Huawei and ZTE, both leading Chinese telecommunications enterprises, United Electronics, an internet firm, took a stake of over 75% in the Chinese Carsmart website, which provides technology solutions for cars, at 562.5 million yuan (US$92.9 million) in early June last year. Hi-RTK Road, a GPS (global positioning system) service provider, acquired Guangzhou O.CN Internet Technology, a 3D map database, for 83 million yuan (US$13.7 million), last year, in order to tap the emerging market of in-car information systems.

The car-related internet technology fad is sweeping the global hi-tech market, as evidenced by the high profile of auto-related internet companies during the US Consumer Electronics Show held in Las Vegas in early January this year, where tech giants, such as Intel, Ericsson, Qualcomm, Google, and Apple, displayed various internet and driverless-car solutions. The displays attracted even more attention than smart wearable devices during the exhibition.

Previously, Intel set up a US$100 million fund for car-related internet solutions, Ericsson teamed up with Volvo in rolling out an auto cloud system, and Apple unveiled their “iOS in the car” plan, aiming to incorporate the iOS 7 system into the in-car systems of major automakers. Google, which has been quietly carrying out R&D on driverless cars, announced on Jan. 6 the setup of an “open auto league,” in cooperation with auto giants, for the formulation of Android-based auto systems.

“The auto industry is undergoing a dramatic reform behind the scenes, the outcome of which will determine the fate of industry players,” remarked Li Shufu, chairman of Zhejiang-based Geely Auto, adding, “The internet will increasingly be integrated into vehicles, leading to the birth of driverless cars.”

SBD, a market research firm, predicts that capacity of the global car-related internet solutions market will top US$53 billion by 2018, attracting the participation of automakers, hi-tech firms, startups, venture capital firms, and telecom firms.

Intel has been pioneering the development of mobile chips for in-car information systems. The aforementioned US$100 million fund will be invested in the development of in-car information and entertainment systems and applications, as well as driving assistance systems, such as night vision, voice and gesture recognition, and eyeball tracking applications. “Incorporating internet technology into cars will make them smarter and safer, linking up humans and cars via mega-data transmission and then materializing a series of services, such as instant transportation and remote diagnosis, which will lay a solid foundation for smart transportation,” remarks Hans Vestberg, president and CEO of Ericsson.

 

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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