Frost & Sullivan: Internet Radio is the Most Popular Brought-in App Being Developed by Automotive OEMs

LONDON, July 27, 2010 - Brought-in apps such as Internet radio are the latest developments in the
automotive apps and services market. There is a gradual shift in the United
States and Europe from embedded telematics to hybrid connected telematics in
terms of allowing features to run from a smartphone inside the car. Within
this hybrid connected space, vehicle manufacturers have enough traction to
allow Internet radio apps to run inside the car from the smartphone and
control it using vehicle Human Machine Interface (HMI).

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New analysis from Frost & Sullivan (www.automotive.frost.com),
Executive Analysis of European and North American Automotive App Store
Concepts and Services, finds that the hybrid connected model will have an
addressable market size of more than 5 million units by 2015 in North America
alone. Hybrid connected telematics models like the Ford Sync offers huge
potential to bring smartphones into the cabin of the car and allow brought-in
apps to run using vehicle HMI.

"Gen-Y'ers and technology usage trends in the United States and Europe
are driving the use of mobile Internet on new generation smartphones and
downloading apps from sites like Apple is becoming increasingly popular,"
says Frost & Sullivan's Global Programme Manager, Praveen Chandrasekar. "By
using safe HMI to allow smartphones to be accessed inside the cabin, vehicle
manufacturers are creating a superior brand image since consumers can
continue to savour their digital experience inside the car." In Europe and
the United States, Gen Y will continue to account for at least a quarter of
the total population until 2030, but in South Asia, Gen Y will likely
represent over 40 per cent of the population by 2030

This market is not without its challenges though, with connectivity and
driver distraction being the main problems. On the one hand, vehicle
manufacturers are looking to offer connectivity and services using consumers'
voice and data connection. On the other hand, telecom operators are objecting
to this model and want vehicle manufacturers to put an additional security
identity module (SIM) card with a dedicated voice and data plan to power
services inside the car.

"Furthermore, the safety regulatory committees in Europe and North
America are concerned about safety and driver distraction aspects associated
with smartphones in cars," explains Chandrasekar.

There is increasing pressure from automakers to allow apps from
smartphones to run inside the car for consumers to safely utilize apps using
vehicle HMI. Although apps like Pandora Internet radio are available free of
charge, it is lucrative for automakers to provide specific HMI solutions that
consumers can buy to access apps. This will allow consumers to manage
everything through one communication module with a single bill.

"Future trends like the EU's eCall legislation may mandate obligatory
dedicated SIM cards inside the car for data and voice services, enabling the
European telematics market to transition from a completely built-in model to
a hybrid connected brought-in model," concludes Chandrasekar.

If you are interested in more information on this study, please e-mail
Monika Kwiecinska, Corporate Communications, at monika.kwiecinska@frost.com,
with your full name, company name, title, telephone number, company e-mail
address, company website, city, state and country.

Executive Analysis of European and North American Automotive App Store
Concepts and Services is part of the Automotive & Transportation Growth
Partnership Services programme, which also includes research in the following
markets: Strategic Market and Technology Assessment of Telematics
Applications for Electric Vehicles, Global Trend Analysis of Passenger
Vehicle Telematics and Infotainment Market - 2009 Edition, and Strategic
Analysis of The European Market for Low Cost OEM Navigation Systems. All
research services included in subscriptions provide detailed market
opportunities and industry trends that have been evaluated following
extensive interviews with market participants.

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    Executive Analysis of European and North American Automotive App Store
                        Concepts and Services
                                M551

    Contact:
    Monika Kwiecinska
    Corporate Communications - Europe
    P: +48-22-390-4127
    F: +48-22-390-4160
    E: monika.kwiecinska@frost.com

www.frost.com

Monika Kwiecinska of Frost & Sullivan, Corporate Communications - Europe, +48-22-390-4127, fax, +48-22-390-4160, monika.kwiecinska at frost.com