Palm has announced it will launch a voice-activated in-car kit for its PDA.
Palm will form a joint venture called MobileAria with one of the world’s largest in-car systems manufacturers, Delphi Automotive Systems. The idea is to allow drivers to manage personal information and access mobile Internet services whilst keeping their hands on the wheel and their eyes on the road. The first systems to be launched will appear in mid-2001.
The company’s first project will consist of a Delphi in-car system cabled together with a Palm PDA and a mobile phone. This is quite limited in terms of added value. However, before very long MobileArea will also aim to incorporate internet-based entertainment systems, as well as integrating car and PDA functions more smoothly. It aims to market first to end-users, but ultimately to automotive companies as well. The hope is to derive the majority of revenue from access to subscription services.
Since the market for telematics services is expected to reach E10 billion by 2005, this could be a positive financial move for Palm. If the company becomes a major player in the telematics area, this will give the company’s operating system a substantial advantage over the rival Epoc technology that mobile phone manufacturers are currently rolling out. After all, people will want to ensure their cars and phones are compatible. And Delphi’s size and market power may well allow the venture to grab a substantial share of the market.
But any company that wants to get a slice of the telematics market will need to act quickly. Although it is doubtful how much people will be prepared to pay for in-car services, there is already a lot of competition in the market. It seems likely that prices will come down quite rapidly as this increases. This is good news for consumers, but it will be increasingly hard for companies to make money unless they can attract genuinely large volumes. Palm and Delphi are in a better position to do so than many.
