THE BLOG
06/17/2013 07:06 pm ET Updated Aug 17, 2013

The Next Mobile Frontier: The 'iCar'?

Last week, the newest frontier in mobility and application development dawned: the "iCar." During its annual World Wide Developer's Conference (WWDC), Apple announced plans to bring the iOS experience in 2014 to at least 12 different car markers. The news follows other major program announcements in the recent past, such as Ford's (they were not part of Apple's announcement) March release of the OpenXC architecture, allowing independent developers to create hardware and software that can interact with a car's on-board system in Ford vehicles.

Up until now, many car manufacturers have largely missed the boat on the mobile and smartphone revolution. For years, automakers have been enchanted with the promise of in-car software such as navigation, voice recognition and satellite radio systems, largely built on closed and "homegrown" technology that was proprietary to that automaker. Car manufacturers hoped if they could simply convince drivers their in-car system was best or simply a bit more useful than other automotive competitors, they could create loyalty and drive additional profit from the higher margins on these systems. However, these technologies were often expensive, poorly designed, limited and very slow to update (if at all) -- problems iOS and Android are well-suited to solve. So while automakers stumble to release mediocre/incremental and inferior in-car technologies, apps provide low-cost, innovative, ever-evolving solutions to drivers' needs. Think about it -- how many times in the car (hopefully pulled over) have you used your $2 (or free) app to accomplish a task that your $2,000+ car system couldn't do as well? According to the J.D. Power and Associates 2012 U.S. Navigation Usage Satisfaction Index, you are not alone. Satisfaction with in-car systems dropped another 13 points in the study's 1,000 point scale to 681, one of the lowest scores on record. Even more telling? Of the 20,704 owners polled, 47 percent had downloaded a navigation app to supplement their in-car system, up from 37 percent in the 2011 study. Further, the research showed that owners "definitely would not" or "probably would not" buy the navigation systems in their vehicles if their smartphone's navigation could be displayed on the car's screen.

This week's "iOS in the car" announcement is a major shift and an acknowledgement from automakers that apps (and iOS in particular) represents the best way to solve a driver's needs. Better than that though, the news is an opportunity for automakers and developers to collaborate in ways that were unthinkable only a short time ago.

The car not only represent a wholly under-served market for the consumer but vastly important strategic move for the two major players in mobile -- Apple and Google. Google's purchase of Waze is an exciting first response to Apple in the burgeoning battleground for automotive users and their data driving. Waze's traffic crowd-sourcing technology is a potentially powerful way to recruit hundreds of millions of Android units to provide essential data on accidents, conditions and traffic on roads around the world.

As Apple and Google continue their battle for market dominance and search for new user data, the car represents a huge opportunity to both serve the consumer and gather vital user data. It was only five years ago the smartphone "app economy" didn't exist. Five years from now, a key auto purchase decision may be if it runs Android or iOS.