Car and Internet industries set for further integration

Tencent's Lubao box Photo: Courtesy of Tencent

In addition to screens for TV sets, computers and mobile phones, Internet companies now are working with automakers on a fourth type of screen - control panels for vehicles.

Google and automakers GM, Audi, Honda and Hyundai formed the Open Automotive Alliance earlier this year to incorporate its Android operating system into cars.

Leading Chinese Internet companies also joined the trend. China's three Internet giants Alibaba Group, Baidu Inc and Tencent Holdings have all started making efforts in the automobile field.

Alibaba, SAIC cooperation

E-commerce giant Alibaba and Shanghai-based automaker SAIC Motor Corp signed an agreement on July 23 on applying Internet technologies to SAIC's future products, Alibaba told the Global Times Monday via e-mail.

The two sides are aiming for a combination of Alibaba's YunOS operating system as well as its mapping and music services with SAIC's auto design and manufacture, leading to an integration between the Internet and auto manufacturing industries, according to Alibaba.

Although Alibaba did not reveal further details ahead of its IPO, the 21st Century Business Herald newspaper reported Monday that there is no upper limit on the cooperation budget.

SAIC will be responsible for vehicles and Alibaba will develop the software, the report said, noting the two sides will pay for their own tasks and share the intellectual property rights of the research results.

The cooperation achievement will be implemented on SAIC's Roewe 550, which has already installed the inkaNet system, Alibaba said.

InkaNet is an Android vehicle operating system developed by SAIC

in 2010 and it mainly provides mapping and entertainment services including music and film downloading, according to the introduction on Roewe's Weibo account.

The system has been applied to most models of the Roewe brand, media reports said.

According to an experience report on the latest version inkaNet 3.0 released in September 2013 on autohome.com.cn, inkaNet possesses a voice navigation function, similar to iPhone's Siri, and can provide Wi-Fi for all passengers in the car.

Alibaba, which has filed its prospectus to the US Securities and Exchange Commission, has come up with a rich product portfolio with a wide range of investments and purchases since last year.

Alibaba has now acquired online mapping firm Autonavi, music website xiami.com, launched its virtual network operator Ali Telecom and began online auto purchases with its payment tool Alipay on July 23.

Alibaba expects to integrate these services into the "Internet vehicle" to provide intellectual services to car owners.

Time to app-grade

In addition to working on partially self-driving cars, Baidu has also cooperated with automaker BMW for the first time to enable developers to build in-car apps on its Light App platform.

Baidu and BMW jointly held an in-car Light App hackathon in BMW's Experience Center in Shanghai on July 18, according to a news release Baidu sent to the Global Times Monday.

Eighty app developers from 19 teams built demos for 19 Light Apps that can be used on BMW's in-car system "Connected Drive," and tested their demos on BMW's i3 electric car.

The winner of the hackathon was a team of developers who built a street view navigation app by connecting to Baidu Open Maps patform's street view API, which provides drivers with the street view of their destination and the roads ahead so they know exactly where they are and when to make the right turn.

Herbert Diess, a member of BMW's management board, said at the hackathon that connecting people in the car can only be done through joint efforts of automakers, Internet companies and app developers, the news release said.

He also said that Chinese developers are more customer-oriented than their counterparts in Silicon Valley.

Unlike Alibaba and Baidu who cooperated with automakers, Tencent initiated cooperation with the People's Insurance Co of China and Shell Group, providing discounts on car insurance and car maintenance, Tencent told the Global Times Monday via e-mail.

Tencent announced the cooperation at the Global Mobile Internet Conference (GMIC) held on May 5 in Beijing and also released its first Internet of Vehicles (IOV) hardware product Lubao box at the GMIC, according to Tencent.

When users plug the product into the car, the Lubao app on the user's smartphone will be connected with the car through the Lubao box and show the current status of the vehicle to the user, according to Tencent.

The Lubao box can check the vehicle condition before departing, carrying out on-board diagnostics and suggesting fuel-effective driving patterns and paths, Tencent said.

Through the first batch of preorders, 417,428 customers had booked the hardware, the Lubao box Web page showed.

Security concerns

As the largest auto market in the world, China has large potential for IOV business, Zhang Yi, CEO of Guangzhou-based Internet research firm iiMedia Research, told the Global Times Tuesday.

At the same time, most car owners in China have strong purchasing power, so turning control screens in cars into a new intellectual terminal may bring high profits, he noted.

In a recent auto navigation device survey, iiMedia found that many owners of high-end vehicles are unsatisfied with the current service, which is not user-friendly enough, Zhang said, noting there are gaps for Internet firms and automakers to make further improvements together.

However, there are also security risks in the emerging IOV field, such as the threat posed by hackers who may control cars from a distance by taking advantage of system flaws, China's leading anti-virus software company Qihoo 360 Technology Co said on its Weibo on July 21.

Qihoo 360 held a competition to crack Tesla's system on July 16 and later provided the system flaws found in the competition to Tesla, Qihoo 360 told the Global Times Monday via e-mail.

Although Qihoo 360 declined to say whether it will launch related security products, the company said that it will conduct further research in the field and warned that vehicles' access to the Internet should be supervised and protected.