5G and the Transformation of the Auto Industry

5G and the Transformation of the Auto Industry

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[Robert:] Good afternoon, and welcome to another one of CWTA's virtual events. I'm Robert Ghiz, and I'm President and CEO of the Canadian Wireless Telecommunications Association. This is our third event of our virtual series called, "5G Canada: What's Next?" Bonjour tout le monde, et bienvenue à notre troisième événement virtuel sur la futur du 5G au Canada. Cette série nous donne l'occasion de regarder aux tendances et au innovation dans des secteurs particuliers.

This series gives us a chance to look at trends and innovation in specific sectors, and the role that 5G will play in that future. Past studies sponsored by CWTA have looked at the economic impact that 5G will have in Canada, as well as the benefits it will bring to cities and rural communities. We have also looked at the impact that 5G will have on reducing Canada's carbon footprint, and all of these reports can be found on our cwta.ca and 5gcc.ca websites. Based on many of these reports, we know that, through the adoption of 5G, approximately 250,000 permanent full-time jobs will be added to the Canadian economy by 2026.

It is also estimated that we'll add an additional $40 billion to our GDP by that same year. We also estimate – and we know – that this will take a massive investment by Canada's facilities-based carriers. It will take an investment upwards of $26 billion by the year 2026. Accenture also estimates that, with the implementation of 5G, mobile technologies will have the potential to account for up to 23% of Canada's current emission reduction targets by the year 2025. These numbers provide Canada with a great opportunity.

A great opportunity to: 1. Grow our economy and create good jobs. 2. To connect more Canadians – especially those living in rural areas. And 3. To reduce down our carbon footprint. It's a win-win-win situation for Canada and for Canadians.

But what we need to make this happen is a stable regulatory environment that supports facilities-based competition in Canada. To get back to today, today our speakers will discuss 5G and the automotive sector. Our panel will touch on the latest advancements in automotive technology, and how connected vehicles, including 5G-enabled vehicles, will help improve the travel experience for consumers. We're fortunate to have some great presenters with us today: Hervé Utheza and Grant Courville. Today will be moderated by our SVP at the CWTA, Eric Smith, and I'll turn it over to him for a better introduction of today's panelists, and I hope everyone enjoys today's presentation. [Eric:] Thanks, Robert, and good morning – good afternoon – to everyone, depending on where you are.

Over the last five years or more, we've heard a lot about autonomous vehicles – will we ever see truly autonomous vehicles, and, if so, when? But while this discussion has been ongoing, there's been an equally important transformation taking place in the automotive industry. The connected car – and the value the connectivity and data from connected cars will deliver, for car owners, for car manufacturers, which are often referred to as OEMs, and the rest of the auto industry – is something that is less reported. The consulting firm, McKinsey, estimates that, by 2030, 95% of new vehicles sold, globally, will be connected. And whether it's through the ability to update and unlock new hardware and software features, a more seamless in-car experience and personalized maintenance, better safety and security, or better road planning and optimization, connected cars – and the data generated by them – will deliver a better and safer driving experience, and more efficient transportation systems, while also creating revenue opportunities and cost savings.

Telecom operators will play a crucial role in enabling this transformation, and 5G will be a big part of this. Juniper Research estimates that 30 million vehicles with embedded 5G connectivity will be on the roads by 2025, and that 25% of data generated by vehicles will be attributable to 5G in that same time period. So, to explore these themes further, we have two great experts with us today. We really appreciate their time – I know they're very busy, and it's great that they can share their perspective on this with us. And, first up, I'd like to introduce Grant Courville from BlackBerry QNX, and Grant's going to walk us through a bit of the evolution – the technological evolution – that we're seeing in the automotive industry, and what it means in terms of delivering new capabilities and new driving experiences.

So, Grant, I'd like to welcome you to the stage. [Grant:] Glad to be here; thanks, Eric. So, I'd like to thank Robert, Eric, Chantale, and the whole team at CWTA, for the opportunity to present today. So, I'm gonna talk a bit about what we're doing at BlackBerry QNX, and then we'll talk a bit about technology evolution, and obviously connectivity and the impact– and the promise that connectivity has, in terms of the automotive or transportation industry, and, more broadly speaking, smart city, smart infrastructure, and whatnot. So, why don't we..?

There we go. So first, a little bit about BlackBerry and QNX. So QNX was a privately held company, founded in 1980 – we were acquired by BlackBerry in 2010. From an automotive perspective, we've been in automotive since about 1998. So, a little over 20 years. We're a Canadian company; BlackBerry is headquartered in Waterloo.

The core of QNX is in Ottawa, ON, which is where I'm based. I've been with QNX, I'll say, since the early days, and it's truly been a pleasure to be part of it all. From an automotive perspective, as you can see, we're in a little over a hundred– well over 175 million vehicles now, on the road today.

And, so, we build software– we don't build the systems in the cars; we build the software – the foundational software, the operating systems – that you'll find in the various systems in the car, and as you can see, we work with a number of automakers, with a number of what are called "Tier 1s," so essentially, they're the suppliers to the automakers that are building the systems that go into cars. And as you can see here, it's really a mix of, I'll say, your volume and traditional automakers, as well as your new entrants, and definitely a global perspective. So you'll see some brands there, like Plus.ai, and NIO, and XPeng, together with the Detroit Three – GM, Ford, Chrysler Stellantis, obviously, now – so we've had quite a bit of experience in automotive, and that we're quite proud of. We're trusted in automotive – we're very unique – in fact, we're the only company in Canada that does what we do, and very few companies in the world do what we do, in terms of safety critical software for the systems in cars.

So, in terms of software, you've probably heard terms like "software-defined vehicle", "software-defined car" – really, the evolution of the car is what I'll talk about in a minute. From a QNX perspective, we were first known for infotainment. Back in the late 90s - early 2000s, infotainment systems – which is essentially the display, typically in the center of your dashboard – it was projected and known and really was the most complex system in the car, in terms of the amount of software and integration into one system in the vehicle. So that's where we started out, and obviously since then, we're powering telematics systems, for instance like GM OnStar, and as the car adopts more and more software, essentially you're seeing adoption of safety critical in our software throughout the vehicle. We won't have time to get into necessarily a lot of details here, but just know that the software – or, the vehicle – is becoming much more software-defined.

And, to expand on that just a little bit – and you may have seen similar references before – but the number of systems in the car is growing – although I'll add a little footnote to that, which relates to the middle of the screen here, where you're going to see consolidation of systems in the car – but the number of ECUs, or embedded systems in the car, has been growing, the amount of software in the car has been growing, and that's not going to slow down. There's going to be more and more software in the vehicle as the years go on, and more and more of the vehicle will be software-controlled. As I mentioned earlier, there's quite a few ECUs or systems in the car; what everybody's doing now is slowly moving towards what are called "domain controllers". So you're going to see multiple computers in the car – systems in the car – combine into one.

And those one system– the domain controllers, and the cockpit of the cars – the classic example – it's going to take on more control of what multiple systems used to do, and, again, that's where safety-critical software – which is ultra reliable, ultra safe, ultra secure – comes into play, and that's what we do. As you can see, the amount of electronics and software in the vehicles is going to grow at a very rapid pace as well. So all this is happening – you might not be aware of it; you're probably driving even vehicles with newer vehicle, where you're seeing many more safety features, and many more elements of the car being software-controlled.

So, let's talk about connectivity. From a connectivity perspective, essentially– and I'm not going to get wrapped around the axle on the numbers, but the directional– the, in terms of where things are going, as Eric mentioned earlier, more and more vehicles are becoming connected, for very good reasons, and it's happening globally. So there's more modems going in cars. You're starting to see 5G, you had 4G, you've got Wi-Fi, all things that we're very aware of. In terms of all the data references you hear, in terms of data from the vehicle, to something external from the car, absolutely the biggest consumer of data, and sharing of data, is between the vehicle and the cloud. That's the way it is today, and that's going to be the way it is going forward.

Which is why you see the Amazons, and Microsofts, and Googles, and others, get involved. That vehicle is going to become essentially an extension of your digital life, it's going to be essentially a connected device – the mobile device on wheels, if you like – these are all things you've heard, and you'll also see a number of acronyms. I'm sharing some of them here, so, V2C, V2D – essentially, they all mean vehicle communications to something external to the vehicle. And there's various use cases and benefits that come along with that, so the automakers have absolutely realized that, cities have absolutely realized that.

The notion of having a car, which has more and more sensors in it, being able to participate in smart cities, and IoT at large, has tremendous benefits, which is why you're seeing this connectivity occur. So here's an interesting chart I've had put up. Historically, what people were looking for was obviously horsepower and whatnot, and then it shifted to infotainment, then you saw more safety features being a primary interest, and, from a connectivity perspective – and I thought this was interesting in 2020, from IBM, in the survey that they did – really, consumers are looking for a lot of the features that you see here.

So again, being able to extend my digital life to the vehicle, be able to diagnose, being able to implement prognostics or predictive analytics, for instance, to personalize the vehicle, and none of these – almost none of these – are possible without a connected car. And there's some challenges coming up, in terms of the connectivity; it's not as easy – as you can imagine – as just putting a modem in the car, and all of a sudden these things will magically appear. But the consumer's very aware of the benefits of connectivity, and these are some of the elements that that can bring forward. Here's where you get into some of the challenges. So, from a vehicle perspective, it really is a bespoke set of systems, where the data and access to data is also very bespoke. There's no standard across all of the automakers, or even across vehicle lines, where the OEM can easily get access to data.

You've got multiple sensors, and more and more being put into the vehicle – guess what – the data from them all comes with various different formats, and again, as it stands today, you don't have that common access. So if you think of a mobile phone, I've got Android, I got IOS. And there's various frameworks, and I can build apps on top of it, and that's for the whole ecosystem. That's not the case in automotive.

Everything is bespoke. Some people would use the word "proprietary", so it's still pretty closed. And there's no easy way to attract developers, because I have no platform that I can build on. Well, I have no commonality of data, or commonality of APIs, so, because it's these bespoke systems, and I don't get any scale, I can't attract the developers. So there's this real challenge that's there today, and it's recognized across the world by all of the automakers, and you've got some automakers trying to build their own systems, you've got some of the cloud providers also trying to solve that problem – it is a big problem – because, again, the lifespan of a vehicle, and the systems in the vehicle – and, again, safety being top priority within the vehicle – these are all things that cannot be compromised, going forward.

So, OEMs see this tremendous opportunity, from a connectivity perspective. From a product design, if they can get access to the data, they can learn a lot more about how you're operating the vehicle, how the vehicle operates. Today, automakers really don't know what features you're using in the car, which features you're not using, which features you're finding it difficult to get at; they really don't have any insight into the vehicle, at all. Again, as we can get into things like predictive analytics and whatnot, we can do targeted recalls; there's huge benefits across – huge digital transformation opportunity, I should say – across the whole IT landscape for OEMs.

The benefits that connectivity can bring to vehicles is definitely not lost on any of the automakers – the Tier 1s, ourselves, or anybody else – within the ecosystem. More specifically, in terms of the two buckets, if you like – in terms of categories – if we can solve the challenges I mentioned earlier, all of a sudden it opens the door to tremendous value, from a revenue generation perspective – and that's not just with the automakers; that's across the whole ecosystem – as well as cost reduction, and these are some of the examples that you see here. Just recently, in fact, in December, we announced a partnership with AWS, and we announced a product called BlackBerry IVY, to solve those challenges – to provide common access to data, through common APIs, common representation of the data, cloud-connected, that'll run on any operating system, support any cloud – really trying to bring that platform to automotive, essentially enable that developer ecosystem, enable those frameworks, add the intelligence in the vehicle, and, from a QNX perspective, we're experts at in-vehicle technology – obviously, AWS, the largest cloud provider in the world – that partnership made absolute sense, and that's what we're doing with BlackBerry IVY, to enable the OEMs to be able to realize that value. And so lastly, I wanted to kind of bring it home, and it was quite timely. So, last week – yeah, May 20th – so, these are a few quotes – and I put the link in here when they share the presentation – these are a few quotes from Jim Farley at Ford – the CEO of Ford – that he made.

Ford, like just about every other OEM, has realized the value of data, and I won't read all of this, but as you can see, they realized the value of connectivity. Connectivity is so important. And we saw the chart earlier with the adoption of 5G – and we'll probably talk about that a bit later, in terms of 5G and whatnot, and DSRC, and V2X, I'll say more in general – but you can see some of the very specific items that Jim Farley has quoted.

And you're seeing some very strong statements. In other words, connectivity being a "game changer". A "software-first" organization. This is Ford. This is Ford, who builds vehicles; they've realized that, "Hey, we need to be a software-first company. Other OEMs have said we need to be mobility companies, for instance." They– I mean, he, in fact, mentions it here: "The network vehicle – the connected vehicle – is going to be very similar to your phone, and really become that computer on wheels."

And, just today, Jim mentioned that they just announced the, I think it's called, "Blue Oval Intelligence," and it's a cloud-based next generation platform – connected platform – it integrates systems for power, electrical, software, and computing. So they're all-in. 100% all-in on vehicle connectivity. And with the Blue Oval system that they have, he mentioned that, by next summer, they'll have more connected vehicles than Tesla, and they'll have, actually, 33 million connected vehicles by 2028. So, very aggressive, which is really impressive, I should say. So you're going to see more and more automaker announcements like this, but here's a very recent example of a company, Ford – leading automaker, tremendous experience, obviously – all-in on software, all-in on connectivity, and bringing intelligence to the vehicle.

And with that, I will pass the ball back to Eric. [Eric:] Thanks a lot, Grant. That was a great overview, and whenever I see your presentations, I'm just always in awe of the scope of what's happening in automotive, and, really, as you said, cars are moving from metal benders and people putting wheels on metal, to really building sophisticated computer systems. And I've got lots of questions for you, but I want to turn, now, for a moment – Grant talked kind of about the architecture of a vehicle, and how it's changing from needing a lot of mechanical engineers, to needing a lot of electronic and software engineers. But also data is a big part of that, because, in order to utilize this computing power, the car both generates a lot of data, and will consume a lot of data, for the different purposes that Grant's laid out. So, I want to welcome onto the stage, Hervé – I'll butcher your last name – Utheza? Is that right? [Hervé:] "Utheza", absolutely.

[Eric:] A Senior Director of Emerging Technologies at HERE Technologies. HERE – some of you may not have heard of it – it's got a very interesting lineage, and a very powerful location data solution, and so, Hervé's going to tell us a little bit about that, so, welcome, Hervé. [Hervé:] Thank you, Eric, and good morning – good afternoon – everybody, wherever you are. I'm Hervé Utheza.

Yes, I do manage the Emerging Technologies at HERE Technologies. Enchanté de faire votre connaissance. Je peux parler français aussi, mais je vais revenir sur l'anglais dans quelques secondes. Merci pour votre attention. I'm going to tell you a little story about HERE Technologies in three phases.

First of all, introduce the company: many of you may be– in the car that you're driving, you may be using us without knowing it. We are a very large global neutral location data and services provider, that powers many, many of the industries of the world. And, so, we are a 35-year-old company, so I'll tell you a little bit about our history, and what we're doing. Then I'm going to explain – or talk a little bit about – the evolution of this mapping world.

The map industry – the location services industry – is in an immense digital transformation, and those moving objects on the road are going through an evolution. Grant talked about the soft revolution – we are seeing the connectivity to the infrastructure – and then, ultimately, there's a change of experience for the end users and the consumer, which translates into, "Why 5G? What is the value of 5G? Is 5G different than this quantum leap from 3G to 4G?" And then we'll close with a couple of business observations about the market that we see, in the different timelines – in the different regions – and, of course, bringing it back here to North America. So, HERE Technologies– and I'm going to push the button; I'm not sure I have the control quite yet.

There you go. Thank you. The history of HERE Technologies is a long, rich history. We're about 35 years old company; we started as Navteq, actually, here in the Silicon Valley, where I'm at. And we grew to be a mapping provider, making digital data for the map of the infotainment system that Grant talked about, in the car. Initially, delivering the map data as part of a software package, that gets added in the ROM and the RAM of the vehicle on the manufacturing floor, moving to those old shiny digital disk objects – the CD-ROM – we still actually have a business – imagine that – of updating our map through CD-ROM, to direct-to-consumers, in support of our car makers' customers.

And we grew out of that to be, for a while, Nokia Maps, on the mobile phone, and supported the evolution to the digital mobile phone. And, about five years ago, when Nokia changed who they were, as you remember very well, some of our automotive OEM customers decided to build – and to bring – this company under their wing, and so Audi, BMW, and Daimler created a consortium, and we became HERE Technologies. And that consortium has, since then, expanded, with investment from Intel, Pioneer, Bosch, Continental, NTT, and Mitsubishi, and now we are a global neutral player, in the space of location services. I'm using the term "neutral" in the sense that we're a B2B player; that's why you do not hear much from us when you look at a HERE map on a connected vehicle. And we have also expanded into many, many different industries, and customer base.

So, what do we do? Mapping, really, is a set of data layers, covered by a set of web services and APIs, that deliver that data, and that enable our customers and our partners to build application services on top of it, and to exploit the value of location intelligence. We do have some application and full systems as well. As we evolved to go from the automotive business, we have some infotainment systems. We went into transportation and logistics, so we have an asset tracking and management system. We have a fleet management system, that helps fleets and transportation and logistics companies of the world to move the package from the warehouse to your doorstep.

And we do this with the same infrastructure that is repeated over and over into different configuration and integration deployment scenarios. We do this across many different use cases. For telecommunication service providers, in particular, we are helping them, and we have done a key agreement with Verizon, that we announced a year and a half ago – two years ago – where we're powering many of the location services of Verizon, and many other industry use cases.

We have a team approaching the public sector environment – smart cities – we have a team going after the transportation and logistics, as I mentioned. We are starting to see 5G in industrial warehousing. What happens, suddenly, when you're bringing in the power of MEC – the Mobile Edge Compute – with the processing in the plant of all those movements: of the robots, of the humans in the plant, the assets, the pallets that will go from the manufacturing floor, to the loading dock, to the truck, to the distribution warehouse, and ultimately to your doorstep? We are seeing 5G approach and cut across all those industries. Because, the way that I personally look at it, is that 5G is opening up, in front of us, an era of precision. And, sometimes – we'll maybe save that for the Q&A – I ask myself whether 5G should not be renamed "1T", or a different object, because 5G brings, with it, lots of different value proposition and benefits than the pure bandwidth improvement – which, what is the consumer or the industry mindset has been, to think about a quantum leap in the telecommunication technology.

When you look at the scale that we have, it's a global operation. We have data for the map for more than 250 countries, we have employees in more than 56 countries, we power an astronomical number of applications and services, our platform runs at about 80 billion API calls, so all those devices connected are now pinging our platform at a fast rate and growing, and every auto OEM is our customer in one way, shape, or form. So, that's, if you will, the introduction to HERE Technologies. We are therefore facing today, with 5G arriving, and all the change into what a map or a location service really means. We went from that way of thinking about a map as a 2D image that you render on your phone, or on the screen of the connected car, and you go from one place to the other, and you have a routing, and you have a guidance, and that's, if you will, what people think of map.

But the reality is now evolving towards a world where the 3D representation of the world is important. Curvature of a city. I live in San Francisco, and you see here, on the second vignette, a different 3D view of the same location that I put on the first vignette. This is close to the waterfront by Fisherman's Wharf, and now we're looking towards the pyramid, and the evolution of the user interfaces in that connected car are getting to a point of sophistication to always push the boundary of what is possible with the technology, and more and more auto OEMs are actually looking at 3D rendition of the map, to make the map very pleasing. We actually did a demonstrator of what is possible, with our friends at Unity, which is also driving 3D into the technology field.

To make that 3D representation of the world, we actually are going back to the source; we ran a fleet of cars, equipped with lasers and high quality cameras, and we make a digital twin of the world. That's the third vignette. And that digital twin of the world – we have a few versions of it – depending on the precision, the accuracy, what is the interest around the object that a provider/tech operator/car maker needs? But we're making very, very precise map of the world. For example, here you're seeing Broadway Avenue in New York, and we have an object – a data set – that enables a telco operator to actually plan the deployment of their 5G infrastructure, especially for interests in line of thinking about millimeter wave, because when you have leaves on the trees of a particular area, it's going to be cutting the 5G mmWave signal. And therefore, cell planning, network planning, small cell placement, is dependent – and the capital investment that the telco operator today is having to make – is dependent on a precise understanding of the geometry of the world, where that infrastructure is going to go. And so, we do see, at HERE Technologies, the evolution and the different strategies that all the telco operators are employing, between 5G mmWave, to mid-band, to low-band, and how that plays out, into their deployment strategies and how the automotive OEMs are thinking about 5G deployment, in that context.

A automotive OEM will have to therefore think about, "What is the service that is now available in a downtown urban center where I have 5G mmWave deployed, by opposition to what's available in the suburbia, where I may only face mid-band, all the way down to the highway, that may be equipped with 5G mmWave, but when I take off the highway off-ramp, I'm now on low-band because I am in a more rural area?" Those are the conversations that we are helping power, and helping both sets of the marketplace design their systems for. And then the next version of the map is a map made of objects, and movements, and captures, and sensors, and data – Grant made a excellent presentation about all the types of datas that a car can produce: its location, whether the temperature, whether the driver has applied the brake pedal at that moment – maybe there's a hazard right in front of the road – the ability to see, with cameras, a pothole on lane three of the highway, the ability to know that you're having high density of traffic, the ability to, ultimately, as the automotive industry is moving from connected car to autonomous driving, with all these five classes of autonomy. You end up also looking at precise positioning, understanding the lane direction – you cannot suddenly have a car go from lane one to lane five of the highway, and ask it to do the drive so quickly – so, there is a need for understanding the lanes. We have a HERE product, "HERE Lanes," that builds that map in support of an ecosystem of data that moves in, into our systems, and ultimately, one day, will also be processed at the edge of the network. So what does that mean? That all this complexity that Grant has talked about, that we are seeing, we actually believe that it really takes partnerships between the private sector, multiple companies, multiple vendors, integration to be done, with careful thinking and planning of an evolution of the services that can deployed at scale, simply for the consumer – when you're in a car, you have to pay attention, so you cannot be distracted – it takes data, it takes a platform, and it takes innovation. We are at a great time of uncertainty and innovation, where lots of different players are taking big bets.

But I also believe that it takes partnerships with the public sector to be able to also connect, because, when Grant talks about disconnected V2X, with a car talking to the infrastructure, or the smart city – the intelligent transportation system – you need to have actors who are going to come to the table, and actually discuss, "What is the data they're willing to exchange? Where does the data reside? What is the exchange of value between all those components?" And building ecosystems is what we know how to do. We, ourselves, are partnering with many, many players in the market. It is fascinating to see that many of what we call our customer relationships are more and more evolving towards, frankly, partnerships, where we are having deep conversations about data exchanges, enhancing data, paying attention to, ultimately, the end consumer, because, in a world of privacy regulations, and the arrival, on the North American continent, of regulations – we are tracking, very well, what is going on in the United States about location, a federal bill that, one day, will be introducing in Congress, a little akin to the European GDPR model – consumer-first, privacy-first, view of location intelligence, with an ecosystem of players that is well orchestrated around all of this. We, with our industry history, are bringing a lot of global partnerships to the table, to actually do all of this.

So, I'll finish by saying that, when we try to think about all of this, we're observing a couple of things at this stage in the market development. One is that the automotive customers – OEM partners, and clients of ours, and market players – are paying attention a lot to the concept of safety. The ability to bring in more advanced safety services that are going to make the car safer, where the car is going to be trending towards zero congestion – zero emission, of course, with electrification – we are seeing a big trend around making that connected object much safer.

Yes, we are hearing it's a mobile phone with wheels, in which you sit. The reality is that it's also much more mission critical to do this well. And so, partnerships with companies like Amazon – we're also a partner of Amazon, with our friends at BlackBerry – are essential to actually bring the best of breed technologies there. Second is that the integration you're seeing here – a couple of vignettes, the second from the right – innovation with telco world. We have done some innovation PoCs with our friends at Verizon for collision avoidance, and being able to send alert signals to that ADAS system – to that autonomous driving and driver-assistance system – when you can see things, but, most importantly, when you cannot see them.

Blind intersections – understanding what is in the trajectory, or the possible trajectory of that vehicle – is important. We're seeing a lot of work and innovation for the foreseeable two years; now we're talking about investment, today, to actually build the next level of safety in those environments. And then third is a question that I'll probably launch for the debate: "What are the classes of data, and the public private partnerships, that need to be stricken?" In Europe, because we're a player in Europe, we do see that the European Union is very clear on what data sets must be made available by automotive OEMs, in support of safety use cases. And the European Union has a classification of five tiers of data – maybe three would be enough – one with neutrality of access, and transparency of access, and fair and reasonable use access, for some of the data that is necessary for those intelligent transportation systems, then data that will be shared on a fairly equitable basis between commercial vendors, where a commercial player will make money off exploitation of that data, and the third one is proprietary data reserved by the OEM for building their own personalization, their own proprietary, their own unique experiences. We are just at the beginning of discovering all of this, but when we think about our data strategy around location, privacy-first location intelligence, connected cars talking to the infrastructure, and the regulations around the use and the rules around data, those are the key themes that occupy most of my time, and the time of many of my colleagues behind me these days. So, thank you very much for your attention; I'll pass it on back to Eric.

Merci à vous tous pour votre attention. [Eric:] Thanks a lot, Hervé, that was great. And, so, we're going to move on to sort of a moderated Q&A, so I'll invite both Grant and Hervé back to the main stage, so people can see them.

And, I think I'll start with you, Grant. Obviously, one of the areas that we, at CWTA, are interested in, is the connectivity part, and, in particular, with cellular connectivity, and I know, for a number of years, there was a debate as to what role cellular connectivity might play in the connected car, and, definitely, there was some momentum around other standards, like DSRC, and I'm just wondering if you can just briefly give an overview of what that evolution was, and how we've kind of moved, I think, from – at least, from my outsider's view – from a DSRC kind of being prioritized, to more cellular V2X? [Grant:] And not that you'd have a biased opinion in any way. [Eric:] Not at all. [Grant:] Not at all, no! I think Hervé and myself – I mean, a lot of people – have seen that, I'll say, evolution.

The battle is still ongoing – I mean, DSRC had a big head start, obviously; it was introduced in 1999 – and the other thing, as well, I think I should talk a bit about terminology, because you'll hear words like "DSRC" or "Dedicated Short-Range Communications", you'll hear "802.11p", you'll hear "ITS-G5"; they all kind of mean the same thing, or they're used interchangeably, I should probably say. And I'll relate to Wi-Fi, obviously; C-V2X is cellular backed by the 3GPP. So, as much as DSRC had a big head start, really, it's been, I'll say, slow-going.

And, in fact, you had DSRC introduced in '99, then in 2016 you had the National Highway Transportation Safety Association, or more commonly known as NHTSA, in the US, released a notice of proposed rulemaking to mandate DSRC for V2V, so that was a bit of a wake-up call, if you like, or a decision that was made, but again, it was just a proposal. In 2017, you had Cadillac CTS vehicles that were DSRC-enabled – and, by the way, they were also based on QNX – and then in '19, you had the EU that's saying they're going to be technology neutral, which opened the door to cellular vehicle communications. So since then, you're seeing a lot of announcements and whatnot, related to DSRC and and C-V2X.

There's a 5GAA association (5G Automotive Association) obviously, that's backing C-V2X. And, I think we're still divided, but I'm with you, Eric, in the sense that the momentum seems to be really behind cellular communication. The nice thing about C-V2X and DSRC is the message format is the same; they're both secure, but, of course, they need completely different radios. So, in other words, I either put a chip in the car that can support both, or I make a decision, or I implement two, which is obviously a cost issue. China's leading towards C-V2X, Ford, they've announced C-V2X in their vehicles by 2022, and then you've got VW, recently, saying they're going to ship – and probably are shipping – DSRC-equipped vehicles. So, we're still a bit fragmented; I do see more momentum on the cellular communications.

I mean, at the end of the day, the industry – everybody – realized it's important, for a lot of the reasons that Hervé mentioned – and it was a great presentation, by the way – but everything from traffic management, environmental benefits, safety, I mean, absolutely. But mass adoption, and, I think Robert touched on it earlier – Hervé touched on it as well – it's going to require a lot of partnerships – a lot of investment – from various levels of government, from industry, from regulators; we still have a lot of work to do. The value recognized in the connectivity, absolutely, no question. Now, whether it's going to be 5G, C-V2X – I personally think that's exactly where it's going, and that will be the dominant V2X connectivity mechanism – but we still have a ways to go.

There's, again, a lot of investment in infrastructure, people put DSRC modems in their vehicles, I mentioned earlier, but it was lonely; there was no one to talk to. So, we don't want to be in that situation again, and, again, a lot of investment – a lot of standardization, as Hervé mentioned – definitely with an eye on security, definitely with an eye on privacy. Work to do, it's coming. I think you're going to see the modems in the car – back to what I was saying earlier, vehicle-to-cloud – because that's, right now, the biggest consumer and use case for data, and then you're going to see – now that the modem's in the vehicle – I think, personally, you'll start to see alignment around C-V2X. [Eric:] Thanks, Grant.

And, Hervé, I noted in one of HERE Technology's recent white papers – which, if it's not up there already, we'll have on our 5gcc.ca website, for people who want to take a look at it – there's a quote that says, "In no generation of mobile technology has location intelligence been more critical or more precise than in 5G." And I was struck– when you're going over the history of your company, starting with Navteq in '85, it kind of runs in parallel to, sort of, the history of cellular connectivity and mobile connectivity.

And, obviously, location data is dependent on a couple of things, in terms of its use in a connected way: the capability of the connected device – its computing power, what it can do – as well as the capabilities of the connections that cellular technology can provide. So, what is it about 5G – you mentioned talking about mission critical things, etc. – what is the capabilities of 5G that are really important to some of the solutions that HERE Technologies provides? [Hervé:] So, one of the things that we're observing is that the telecommunication industry is maybe still struggling to explain what 5G really brings. Because, when you get to the table, I see too many industry players come to it thinking, "Ah, it's a bigger pipe of data, downstream and upstream."

And there is, in the industry, probably still a global lack, at scale – not in this audience, but in the industry – understanding network slicing, and the ability to protect and to guarantee particular bandwidth to a specific device, and the ability to actually have always-on connectivity. Latency is still misunderstood, and we are spending a lot of time with automotive OEMs, trying to find, "What are the use cases where millisecond-level latency in that connection, between that antenna, that edge compute, that intelligent streetlight system, is going to be maybe to the ambulance, for which the telco operator has promised and guaranteed a 5G link of quality, on the route that we're routing them?" So, bandwidth, of course, network slicing, latency... One that is really, really intriguing to us, as a location services provider, is the localization of the processing of the data.

When you're having, suddenly, in a dense urban center, 50,000 connected cars that are going to be emitting some data – still to be defined – talking to the infrastructure around them, maybe talking to one another, within the confine of one single brand family, talking to the underlying counters in the streets that are counting the cars, talking to the infrastructure that may, one day, be making that lane payable, on-demand, with a premium to drive on that lane – right now, we are at what I, personally, consider stage one of that infrastructure – you're having such a noisy network that you need to localize the processing of all the data. And, the industry is therefore looking, today, for the right alignment of the funding, the return on investment, the partnerships that need to be built, and a certain sense of targeted deployment, where, frankly, all of this complexity is going to resolve itself into localization, if you will, of the value-added services that this connected car suddenly accesses, in a dense urban center, then going to the suburbia, then going to the highway, then going to the road in the countryside. And the regulators, by the way, have, in that environment, something to say, because, if you want equality of treatment of all the taxpayers and the citizens who are actually ultimately reaping the benefits of that innovation, that's the march of the next 10 years that we're all embarked on; I think it's going to take that long for all of those things to start clarifying. [Eric:] Thanks.

And I was going to ask you as well, Hervé: you touched upon the public sector's role, and I was just curious, as well – I mean, we're obviously talking about how connected cars can make the driving experience better, can make it safer, etc. – but we have members in our audience who come from different levels of government – some of them are responsible for managing those transportation systems, dealing with the volume of traffic, trying to make the roads safer, trying to make it safer for pedestrians, cyclists, etc. – how can location data – if someone from a municipality came to you and said – how can location data help us manage these vehicles, these people, these cyclists? Do you have solutions that address that as well? [Hervé:] We do. So today, typically, those conversations will start at understanding the past to predict the future, and to looking at trends. So, one of the data sets that we have – you saw, in the little vignette of San Francisco that I was showing, you saw some streets coded in green, yellow, and red – how do you get to that understanding of that street, at that point of time, historically, over the past two to three years, what was the traffic on that street? We have data sets that enable to do that. They come from our partner and relationships with our data providers, that are feeding traffic information into our systems, and we make that available; you can then look at a specific geofence of interest, and bring in that data, into your data systems, if you're sophisticated and you have an IT department capable of doing it, or we can do it for you, and build a system – a web console interface – on top of our platform.

That's today. Where this is headed is the predictive aspect of things: "What will happen when, suddenly, I now have a green wave ready infrastructure of street lights? What happens if my fire department and my ambulances are now connected to the 5G, brought to the market, to the city, in that area? How can I reroute them along a specific route, that is going to be a combination of the traffic information at that particular point of time, and the 5G network signal that I know is on the road links?" Today, we have a cellular signal data set that enables to predictively say, and know, "What will be the signal strength on a particular road segment, at a particular location?" This is how the automotive OEMs, today, are able to trigger – you heard the CEO of Ford talk about those over-the-air data downloads into those connected cars – you can predict them, and you can schedule them to a specific car today, with some of the data sets that we have. I'm being a little tactical and tangible here, but it's to illustrate what is happening today, and where this is headed. [Eric:] That's great, thanks. And, Grant, I'm curious.

So, I know you drive a 1960-something Mustang, right? And it's not a connected car. Except for when you have your smartphone in it. And, a lot of us who are older, our experience with a car is – a new car, you go to a dealer, you buy, it you drive it off a lot – and you may never deal with the dealer or the OEM again. You may never have a relationship with them, unless they send you a recall notice, or something. But obviously, the OEMs are not building in connected capabilities and all these other types of services just to be nice, and to make the experience better. How are they utilizing this, or looking at this, as a way to create sort of a more stickiness relationship with the customer, and also generating revenue, and saving costs? [Grant:] Yep, no, a good question, and you're absolutely right; I do drive a '66 Mustang convertible, which has no electronics in it at all, and no connectivity at all, and that's not why I put the Ford slide on my deck, by the way, in case anybody's wondering.

But, to your point, the OEMs used to– I mean, the model, essentially, worked through dealers – the traditional model – sell the vehicle, and then it was, "Okay, talk to you in four years," unless there was a recall, or more years – I mean, obviously the longevity or the life cycle of vehicle, depending what you look at, can be, on average, I think, 10-11 years. What connectivity allows them to do – what 5G is going to allow them to do – is, to your point, have that ongoing relationship with the consumer. And, the use cases are, honestly, tremendous. I mentioned some of them earlier; they'll be able to find out more about how you're using your vehicle, they'll be able to deliver software updates to improve safety, improve security of the vehicle, deliver new features, for instance, that you could try before you buy, essentially, in the vehicle.

So they'll be able to build that relationship with the vehicle owner – with the drivers of the vehicle – and do so on an ongoing basis, which has been a real challenge for them today. So, on the monetization front, for instance, they'll be able to deliver features to you, whether it's mapping services and whatnot, or other features, that you can experiment, you can try, and then you can subscribe to, on a subscription basis. So just– and even today, you see, you can actually have a subscription for a vehicle.

We've seen it with Porsche, and others, for instance, but connectivity is going to give them that communication, if you like, directly with the car, and insights that you can only get by having direct connectivity with the car. As much as you can have a mobile phone and have connectivity, you won't have the same insights that you have if you're directly connected into the networks in the car, to the systems in the car, to know how they're behaving, to know how the driver or passenger is interacting with the system, for instance. There was a case – we were talking to a number of OEMs – and one of them was, they wanted to get some insight – more insight – into when a vehicle is operating autonomously, or in an automated fashion, I should say. When there's a disengagement, they're trying to get more insight, "Why did the driver take over? Why did that–" (Disengagement, essentially, is when the vehicle is operating in an automated fashion, and the operator of the vehicle takes over.) "Why was that?" So, they want to be able to gather data in the seconds – or minute or so – before that, and then all the environmental data from all the sensors, for instance, be able to package that up intelligently, and then deliver that, so, again, they can gather more intelligence – and Hervé talked about the whole notion of environmental data and whatnot – if they can continually add value, then, absolutely, they'll be able to monetize that value, but also, as I mentioned, there's tremendous operational savings that they can realize, as well.

And, again, not to mention the building of the relationship with the consumer, which, connectivity, 5G, is going to give them more than they've ever had before. [Eric:] We only have a few minutes left, so I have to be mindful of that, and I do want to get to a couple attendee questions – or viewer questions – as well. But one last one, and I'll just ask for a quick response: Hervé mentioned some of the regulatory activities taking place in the EU, around the use of data, using some of the data for the common good vs. some that remains proprietary, and I'm just wondering – I know it's early on, and I know there's discussions going on in the industry – but, what is the industry's attitude to – assuming the regulation of that use of data is harmonious across jurisdictions, so you don't have a huge patchwork – but, do you believe, Hervé, regulation will at least give people some certainty as how they can move forward, rather than being under sort of the "wild west" type view, where you don't really know what, ultimately, is going to be allowed and not allowed in the future? [Hervé:] Hard to predict. You're bringing me back to my youth in the Silicon Valley, where I arrived here in the US, as a young Frenchman manager in a tech company – I was working in digital television at the time – and I observed, at the time, that Europe was taking a standards and regulatory approach to MPEG-2 standardization in one field, and the US – large market with large players – decided to standardize, and there was the fight between DirecTV that had its DSS video encoding and transport schema, and then it resolved itself, but it took 15 years to resolve itself into the international standardization bodies. I suspect that we're going to see the same behavior here, of the regulatory zones, because the North American market is large enough for extremely large players to ultimately bring in, invent, build IP, build large-scale commercial agreements, and so it is the public good aspect of that data, that that safety – that base level – which I think, here, we're going to see in the North American market, the regulator have to think about.

We built a product, called the HERE neutral server, to precisely support our European OEM customers, in that safe neutral exchange of data that supports that common-good, safety-oriented use case. And it is now in use in Europe, between automotive OEMs that have connected cars out there. They're exchanging data so that, for example, if you actually see one car from one brand hit the brakes on the highway, in Germany, at 200 miles an hour – that's how fast they drive over there – you're going to have the driver of the car driving 500 meters behind him actually get a message that an event is happening ahead of him. That's the type of cooperation that this neutral server, if you will, applies. So, we're a little bit, maybe, in advance of the market, from what we see in Europe, to where we're headed in North American market.

[Eric:] No, that's fascinating. Well, I want to thank you both. I do want to address couple questions we had, and I'll just quickly answer them. Angelo had a question about the role of 5G, really, in the factory – in the manufacturing plants – and talked about how some of the major OEMs are starting to use 5G for private networks, etc.

Definitely, that's a very important use of 5G, and we plan to have an event in the future – in the coming months – around industrial 4.0, and smart factories, so please stay tuned for that. And also, just want to acknowledge Joanne, who rightfully pointed out how the FCC, basically, they had reserved spectrum for DSRC back in 1999, as Grant pointed out, but they recently have opened up that spectrum to use with Wi-Fi, so, that kind of has been seen as putting a bit of a... maybe a hurdle, or death nail, on DSRC, at least in the US, but, as Grant says, we'll still see what happens going forward.

So again, thank you very much, Grant and Hervé; this is great. I have probably about 100 other questions I could ask you – I wish we had more time – but, for now, I'll just turn it back to Robert for just some closing remarks. [Robert:] Great! Well, thank you, Eric and Grant, et merci à Hervé pour votre présentation aujourd'hui. The future's exciting. As, I think I've met with Grant before, out at his headquarters there, and it's a constant evolution on what's happening with the automobile today, and who knows where we'll be in four, eight, ten years down the road? But I think, from today's presentation, we learned that things are gonna be safer, things are gonna be smarter, things are gonna be able to do things in a faster manner, so there's an exciting time ahead. So, I want to thank all three of you for being involved.

I want to thank everyone for watching. This has been our third event. We're planning on doing more into the future – of course, in the past, we did one live event every year, but unfortunately, with COVID, that didn't happen, so hopefully we'll get a chance to do live events into the future – but we are planning to take a summer break, and then coming back in hopefully September, to be able to have a few more of these virtual conferences. So, if you've missed any of our previous events, you can find them on our 5G website at 5gcc.ca, and look for the "5G Canada: What's Next?" button. You can also subscribe to our 5G Canada newsletter on that website, by looking for the "Industry News" tab.

Thank you, and have a great day.

2021-06-14 13:46

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