Machine 2 Machine Vision

Despite the ecological value of incentivizing the swapping of low mileage cars for higher mileage cars, there has been some questions over the economic value of the Cash for Clunkers program. Many are wondering if the program only served to pull forward manufacturing demand that would have soon developed anyway. I have been kicking around the following questions: would there have been more value in the program if there were additional incentives for purchasing cars that had telematics systems? Besides the obvious personal and societal advantages regarding safety and security, could cars equipped with telematics potentially be more efficient because of better routing afforded by these devices and their value added services? Could the telematics systems be used to gather real life data regarding emissions? From an economic standpoint, incentivizing the purchase of telematics systems would have extended the value of the program beyond the automotive industry and benefited the wireless device, cellular service, software, and GPS industries as well as others. These industries represent innovation – the future of the nation as well as the automotive industry. Vehicles will have to have connectivity capability resident in order to derive the maximum value out of the Smart infrastructure that is called for in the Stimulus Plan of earlier this year. Incentivizing the purchasing of telematics systems as part of the program would have helped to accelerate this up-take and adoption. The Cash for Clunkers program was based purely on mileage – meaning that many small, low end cars – those most probably lacking in innovative cutting edge technology, including telematics, were left out of the mix, ultimately resulting in missed opportunities on both the economic and ecological fronts.

As I have been saying for some time now, the global economic crisis could very well be a good, albeit tumultuous, period for the telematics and broader M2M space. Telematics and M2M are all about efficiency and productivity. Efficiency and productivity increases are exactly what are needed by industry and enterprises to help them maintain profitability and survive during these times of shrinking economic activity and potential deflation.

The February 17th edition of The Wall Street Journal had an article by Michael Totty with the title: “Smart Roads. Smart Bridges. Smart Grids.” The article makes the case that since the government is making huge infrastructure investments as part of the stimulus plan, it should do so with an eye toward the future and that this technology will provide for an easier monitoring and maintenance of that infrastructure. There are additional cases made for the societal benefit of the Smart Infrastructure in areas such as traffic management and accident avoidance, as well as adding efficiency to the power and water grids.

Government and industry need to realize that they have a common goal in bridging the good provided to society through infrastructure spending with that of private industry’s deployment of applications intended to increase productivity and efficiency. This is because the technologies behind telematics and M2M have evolved to the point where there will be much more utility and value for the industries and enterprises that deploy the technology if the resident infrastructure is enabled to facilitate their deployment – thus providing a value multiplier effect to both parties. I am making the case that this economic crisis is a catalyst for industries’ investments in these applications, while in a parallel track; the stimulus plan will be a catalyst for government spending in “Smart Infrastructure”, which is basically the same as telematics and the broader M2M areas. Those of us in the telematics and M2M industries need to recognize this opportunity and attack it aggressively, despite the generally accepted management instinct to retrench and cut costs during a recession.