RIM could make comeback in connected car space

There are great opportunities in the Machine to Machine sector, largely due to the sheer volume of devices expected to be connected to the Internet of Things. The Telematics market is the longest-standing and most mature part of the M2M industry and has been a test bed for the design of more robust, reliable and longer-lasting components.

The fact that Google has just acquired the first-ever self-driving car licence should come as no surprise. Yet a surprise participant that could make a huge impact on the market is Canadian Blackberry maker RIM, which could see its software development offset poor performance in the handset and tablet space.

RIM’s QNX platform is used in 60 per cent of cars currently on the road, the firm revealed at its BlackBerry World event earlier this month, and according to Jamie Moss, senior analyst at Informa Telecoms and Media, the firm already has the expertise required to develop a strong offering for the connected car market.

“Many people look at operating systems such as iOS think of it as being far too closed so it will never move beyond Apple’s own products and with Android the concern is that it’s far too open, and it’s a bit too “fuzzy” to use in specific deployments – it is best as a general purpose operating system for phones or tablets,” he explains.

“But RIM has the experience that is required to develop something for such a specific type of industry and such a specific type of product.”

RIM’s role in the automobile space is not a well known one. Operating on a white label basis, the in-car computers are often not branded as RIM or Blackberry, but the QNX operating system is what the head unit in the majority of cars run on.

“Drivers don’t know they’re driving a RIM device – QNX would have been commissioned by the individual car manufacturers for RIM to produce a version of the operating system that conformed to their particular requirements and allows the particular services that they wish to offer,” explains Moss. “It usually ends up being branded by the actual company vending to the consumer – so, typically the automobile OEM. They’d be oblivious to the fact that it’s QNX, let alone that RIM now owns QNX.”

At CES this year, Mike Lazaridis said in what turned out to be his last keynote to analysts as RIM’s co-CEO that software development is the key for the firm. The BlackBerry maker has a built a huge hardware portfolio, but the margins on the hardware side have been suffering, while margins on the software side are very good, even if the software side accounts for a lower proportion of overall revenue.

Operators too have not fully exploited the opportunities presented in the in-car market. Three’s CFO Richard Woodward told Telecoms.com that a negligible amount of revenue comes from M2M, but he expects it to grow in the future to a significant proportion.

Despite the negligible revenues operators are currently seeing from M2M, they believe that M2M services will generate five per cent or more of their revenues by 2015, according to the recent Informa-SAP M2M Communications survey, which drew input from more than 260 M2M stakeholders in 50 countries.

Given the strong ties that exist between mobile operators and RIM, it is quite plausible that RIM could recover from the torrid time it has of late by making a comeback in the car space.