The document discusses the connected car industry and opportunities for telematics companies. It notes that younger consumers are more interested in new technologies and connectivity features. Factors like declining costs, new services, and government regulations are driving optimism in telematics. However, telematics providers must deliver flexible platforms to support evolving buyer values around issues like safety, infotainment, and sustainability. While willingness to pay for core safety features is low, integration of new services could enhance customer loyalty and opportunities.

1. The Connected Car:
Driving the Industry
Forward
Telematics Update Munich
November 2009
Hughes Telematics, Inc. Proprietary & Confidential

2. Can Telematics Fuel Industry Recovery?
2
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3. Can Telematics Fuel Industry Recovery?
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4. What NEW is Driving this Optimism?
Feature Integration
Connected Services
Overnight Innovation
Consumer Interest
OEM Cost Reduction
Technology
Device Integration
Connectivity
Repairs
Consumer Savings
Government Regulation
Pay as You Drive Insurance
eCall
Continues to Grow
Congestion Charging
Emissions Reduction
Car-to-Car Communications
Driver Information
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5. Let’s Consider the Buyer
Who is the next generation buyer?
What do they want?
How will TSPs deliver it?
When must OEMS deliver?
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6. What Do Tomorrow’s Buyers Look Like?
The Next Gen 1
o Under 35 years of age
o Mostly female
o Moderate education
o Avid internet users
o 2nd highest ownership of
electronic devices
o Try to stay current with new
technology
o 50% are very interested in
purchasing telematics in
next vehicle
1 GfK Automotive Study, 2007
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7. What Do Tomorrow’s Buyers Look Like?
The Mega Techies 1
o Under 35 years of age
o Mostly male
o College Grads
o Actively adopt new technology
o Want instant access
o Highest ownership of electronic
devices
o 70% are very interested in
purchasing telematics in next
vehicle
1 GfK Automotive Study, 2007
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8. Consumers Crave Connectivity
Smartphones were 21% of
European mobile phone sales
in Q2 ‘09 – IDC
Mobile Internet adoption is
set to grow to 39 percent in
Western Europe in 2014 from
13 percent in 2008.– Forrester
Research
International Facebook users
grew from 34 million at the
beginning of ‘08 to 95 million
users in ‘09 – Facebook
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9. In Fact – Consumers Are Obsessed
The average European
averages 4 texts a day;
teenagers can average as high
as 100. – Tomi Ahonen Mobile
Telecom Annual Review 2009
In February 2009, Facebook
accounted for 4.1% of all
minutes spent online in Europe.
– ComScore
77% of Europeans could not
live without daily access to the
internet, compared to 54% for
access to a car. – AMD & YouGov
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10. Buyer Values Are Changing - Dramatically
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11. Buyer Values Are Changing – Dramatically2
Thrifty
o Virtual Accessories, Mobile
Coupons, Social Apps, PAYD, SVT
Insurance Discounts
Adaptability
o OTA Reflash, Application Store,
Mobile Apps, Web Personalization
Consumer to Consumer
o Social Apps, Web Affinity Groups
Green
o Diagnostics, Emissions, Eco
Navigation, Smart Charging
2 Consumer Psychology, The Economist, April 2009
Proprietary & Confidential

12. Driving Connected:
High Interest
Daily Utility
Opportunities
Safety and Security
Navigation
Convenience
Diagnostics
Infotainment
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13. Driving Connected: The Opportunity
Opportunities Enhancements
Info On Demand
Mobile Apps
High Daily Utility
Services that
OTA Updates Traffic Productivity
Create Daily Utility
Weather
Navigation
POI Search Social Apps
Streaming M-Commerce
Media
Peace of Mind Lifestyle
Opportunities to
Eco-Telematics
Core Services Internet
Create Loyalty
Low Daily Utility
VII
Emissions
Concierge
Dealer Connect Gaming
Diagnostics
ACN/E-Call
High Integration Low Integration
Safety &
Security Navigation Infotainment Diagnostics Convenience
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14. How to Deliver Today’s Services
Flexible and Scalable Architecture
Supports Rapid Service and 3rd Party Integration
Multiple HMIs
Multiple Hardware Platforms
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15. How to Deliver Tomorrow’s Services
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16. Telematics Availability
Percentage of New Cars Shipping with Telematics in Europe3
70%
60%
Research suggests 65% of vehicles
50%
will ship with telematics by 2014
40%
30%
20%
10%
0%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
3 ABI Research, 2009
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17. Willingness to Pay
PEoD for Safety and Safety & Security
70%
Security is only -0.13. 60%
– GfK Automotive 50%
40%
48% of people are 30%
definitely/probably 20%
10%
interested in In- 0%
Vehicle Internet. – JPDA, $10 $15 $20 $25
2009 Navigation
50%
52% of people are 45%
40%
definitely/probably 35%
30%
interested in Personal 25%
20%
Assistance Safety 15%
10%
5%
Services. – JDPA, 2009 0%
$5 $8 $11 $14
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18. Timeline
“By 2012, the majority of
vehicle manufacturers will
concentrate product
development efforts for
mature markets on enabling
wireless data connectivity in
more than half of their next-
generation cars.” – Gartner
Predicts 2009
“A critical turning point for
vehicle ICT solutions is only
two model generations away.”
– Gartner
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19. The Hughes Telematics Response
Keys for Success
o Develop a flexible architecture for future growth
o Look beyond current interest levels and build towards latent
consumer trends
o Break free from stale business models
o In a word – Simplicity
o Integrate with the rest of the ‘connected’ ecosystem
o ‘Cool’ never goes out of style
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20. Contacting Hughes Telematics
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