The real cost of in-car entertainment

There is a battle going on right now for the money that will be made from you and your car - and a very heavy fresh salvo has just been fired off. It has been announced that BMW, Mercedes-Benz and Audi - happy bedfellows, all three - have joined forces to spend the thick end of £2bn on Nokia HERE.

Now, HERE may well be one of the most influential companies we’ve never heard of. An amalgamation of three different mapping firms, HERE has grown over the best part of a decade to the point where, Nokia claims, its map information is installed in more than 80% of new-car infotainment systems. It has map data for almost 200 countries, and live traffic services for more than 30.

On the face of it, the German brands have merely moved to safeguard that data. HERE will carry on selling its information to other manufacturers, allowing them to develop proprietary systems, and the division’s less successful smartphone app business is poised to continue. Think a little further down the line and you can also see why accurate mapping and traffic data will be increasingly useful as cars gain greater autonomy. Why wouldn’t these three heavy-hitters want to make sure they own the back end driving that technology?

This reasoning seems valid enough - but I can’t stop thinking that there’s a bit more to it than that. This move signifies a decision by at least major car manufacturers - and let’s also acknowledge that the Audi tie-in really means the entire VW Group - to not capitulate and hand over key chunks of in-car infotainment systems to non-automotive firms like Apple and Google. And why? Because there’s money in it.

Information on where and how you drive your car is going to be worth more and more in years to come - and we’re starting to see car companies jostling for the right position to get a slice of those profits. They’ve been struggling to keep up with smartphone interfaces that are updated every few months instead of the three-year cycle involved in even a vehicle facelift. 

The foundation of the manufacturers we all know and love is hardware. But we’re already entering a phase where software - the interfaces and services that we all use when we’re on the move - is almost as important. Audi, BMW and Mercedes-Benz clearly think it’s worth working together on - and how often does that happen?