Big trends create new markets

While telematics are now a feature of most new vehicles, they are a prominent part of the latest hybrid and electric cars. And analysts say this is very much around creating demand by making the car easier to manage.

“With hybrid and electric vehicles, they all need extra features so that the automakers will be able to sell the cars,’’ Rao says. “That’s the reason why cars like the Prius and Volt will have advanced telematics features.”

It’s not just about sales. Hybrid and electric vehicles tap into the sustainability trend with green telematics showing drivers the easiest route to take depending on the traffic conditions and providing them with increased fuel savings.

“The theme of hybrid and electric vehicles is to reduce the C02 emissions and increase fuel savings so that’s another reason why they have these features to take it forward,” Rao says.

The significant part about telematics is that they can help revive an industry that has been hammered and seems to be out for the count. For vehicle manufacturers, it offers the opportunity to obtain an ongoing revenue stream. At the same time, it can enhance both standard and after-market product lines. For auto manufacturers and their suppliers, telematics provides a life line and promises many new opportunities.

Healthcare is the other big trend. An ageing baby boomer population means that more will be focused on staying fit and well, out of the nursing home and as independent as possible. Potentially, this could open new opportunities for manufacturers. Examples could include "intelligent textiles". These would be shirts and suits with embedded sensors designed to monitor body fluids such as blood and sweat, which doctors can use to remotely check on the health of recovering hospital patients and those with chronic illnesses.

As with the iPhone, iTunes and telematics, the companies behind these sorts of products are not actually creating demand. They have only identified forces that are already there, and that can be used to create new markets.