Tech start-ups target diagnostics port

As more technology companies develop connected vehicle applications, the OBD-II port has become a critical part of a rapidly growing tech market.

According to ABI Research, OBD-II-based solutions will lap head units with visible displays when it comes to infotainment, location, and other in-vehicle applications and services. Sales of OBD-II form factors will see a compound annual growth rate of 29.5 percent and account for more than 70 percent of aftermarket infotainment shipments in 2020.

At the Consumer Electronics Association, the number of OBD-II offerings from members is also growing. According to Laura Hubbard, senior manager of industry communications at CEA, traditional aftermarket suppliers and a new wave of start-ups are targeting the handy diagnostic port with new applications.

"Some of these companies come from an automotive background," Hubbard says. "There is such a lag time in the technology being added to the vehicles by the OEMs that by the time the car is in production, the tech might be obsolete. These new companies can get that technology into the car without it having to be built in, and they connect with smartphones, which in many cases are more powerful than the computers in the vehicle."

Onboard diagnostics (OBD) plug-in systems typically make use of an embedded cellular connection to communicate with the vehicle CAN-bus. In addition to familiar usage based insurance (UBI) equipment, there are also plug-in solutions for vehicle diagnostics, driver tracking, Wi-Fi hotspots, and other applications.

Right now, the biggest piece of the OBD-II pie belongs to the UBI market, which will generate $475 million in revenue for manufacturers by 2020, according to Ptolemus Consulting Group. U.S. companies have had an easier time because the OBD-II ports are standard in all vehicles produced after 1996. In Europe, the OBD ports follow different standards, making it difficult for manufacturers to market solutions.

Third-party suppliers also have developed multi-purpose connected vehicle platforms. Vinli, for example, is an OBD-II device that includes Wi-Fi, vehicle tracking, teen driver monitoring, diagnostics, roadside assistance, home automation, and an app store that provides access to other solutions. Drivers pay a $30/year subscription fee. Upgrades for premium apps and services cost an additional fee.

Other vendors with similar offerings include Automatic, Mojio and Zubie. Most of these devices provide an application development framework so that developers can provide software solutions that take advantage of the wireless vehicle-mobile phone connection enabled by the hardware.

“This is what makes OBD-II platform aftermarket application frameworks like Mojio or Vinli so appealing,” said James Hodgson, analyst at ABI. “A simple reality of the OBD port is that only one is to be found in every car – with no easy way of adapting it to support the various solutions which need its power and unique access to CAN-bus data. OBD dongles with support for multiple third-party applications enable the peaceful coexistence of would-be competitive services, as well as the promise of more to come.”

Hubbard says that many companies targeting connected vehicle applications are getting a foot in the door by targeting fleet management. "They don't just want to monitor the driver, but monitor the cars and get specific information that might help them with saving money," Hubbard says.

These new applications are taking a variety of forms, and all take advantage of the same type of connectivity that aftermarket repairers hope to leverage into better relationships with their own customers. For example, SMARTwheel (created by a group of New Hampshire teenagers) is a device designed to prevent distracted driving that actually snaps onto the steering wheel and delivers alerts if you take your hands off the wheel.

"Companies are really tapping into the technology in mobile phones in interesting ways," Hubbard says. "They are looking for ways to use smartphones safely in the car, as well as the sensors built into the phone."

Both OBD-II and head unit-based solutions will encompass a variety of both diagnostic and infotainment applications.

"As more people get used to these interfaces, it will change the way information is accessed in the vehicle," Hubbard says. "It will be more intuitive and easy to understand. But it takes a while to get that technology into the car, so we'll likely see more innovation in the aftermarket because that cycle takes less time."

As with built-in connected vehicle systems, security is going to be an increasing concern as more drivers adopt interactive solutions that allow wireless communication with other vehicle systems. Researchers at the University of California at San Diego recently demonstrated that they could wirelessly hack into an OBD-II dongle and gain control of vehicle functions via the CAN-bus.

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