For many users, linking their iPhone to their car is a great way to listen to their music handsfree. Apple's Carplay and Google's Android Auto are systems provided to the car companies to deliver in-car services to drivers -- but the battle brewing is who will harvest the driver data and profits from that.
With analysts projecting billions of dollars in revenue from using such data, the car companies are negotiating hard with Google and Apple to keep the data collected under their own control:
"The risk is, if you give up control and somebody else figures out that business model, then you lose the future revenue stream," said Friedmar Rumpel, vice president in AlixPartners' automotive practice.
The car companies in many cases are severely limiting which data Google and Apple have access to from the car operations or in the case of Ford and Audi; the companies are creating their own technology systems to completely replace Google and Apple's software.
The reason for this hard negotiations is that car data is not only incredibly valuable to the car companies themselves but also to third parties who the car companies look to share the data with for new revenue streams:
The vehicle's activity can reveal various information about the driver and their habits, including their most frequent destinations, where they do their shopping, what bars or restaurants they frequent, where they buy their gas, how fast they usually drive, and other such information. This data can be valuable to merchants, insurance companies and the like, and carmakers want to prevent Google and Apple from getting their hands on this information collected by in-car technology systems.
One key partner for that data are insurance companies to "allow insurers to base their rates on a driver's behavior behind the wheel."
Notably absent from the articles on this battle is how drivers themselves are negotiating for their share in these massive revenues. They may gain implicitly from some cheaper services but, like most of these corporate-to-corporate battles over data, the clear assumption is that most of the added value from the data services will accrue to the companies themselves and the key battle is over which company will profit most from consumers giving up their data largely for free.
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