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The Next Frontier: Unveiling the Game-Changing Business Model Reshaping Automotive and Media Industries

July 18, 2023

When an idea becomes an “aha moment,” it can only mean you have valuable insight. When we discuss the convergence of the entertainment and automotive industries, that is precisely what is happening. If the industries focus on the infinite possibilities they could collaboratively offer their consumers, they both will see success. What once existed in the imagination is possible today, but what happened in the middle to reach this point? Technology has evolved, and now we have all the pieces we need. The opportunities for in-vehicle-rich media experiences have never been greater than today, enabled by a convergence of factors in the automotive space. Vehicle connectivity has come to be nearly ubiquitous in developed markets.

But more than technology is needed to connect the dots. In this article, you will find the most striking trends in vehicle-to-device (V2D) entertainment and the steps companies from both industries should consider moving toward this win-win new business model.

Exploring technological advancements and collaborative opportunities

The entertainment industry heavily relies on technological advancements to enhance content quality, delivery, and diversity. It has seen significant developments in digital streaming platforms, movie special effects, virtual reality (VR) experiences, and interactive gaming technologies. The demanding and curious public pushes the industry to be highly innovative. Competition drives a perpetual search for new forms of revenue streams. With V2D (Vehicle-to-device) entertainment, a whole new world of monetization possibilities opens up, such as subscription and pay-per-use models, advertising and sponsorship models, and data and analytics models. The problem has always been how we integrate entertainment systems in vehicles.

On the other hand, although the mobility industry doesn’t move as fast as Media, it has been forced to reinvent itself to meet changing preferences and expectations. In contemporary car advertisements, the emphasis has shifted away from horsepower and the mechanical performance of the vehicle in terms of driving capabilities. Instead, the focus lies predominantly on factors such as comfort, acoustic features, safety provisions, and advanced driving assistance systems, including autonomous driving capabilities and parking assistance functionalities.

People are focusing on how the experience enhances their day-to-day life. Therefore, cutting-edge car companies realized the importance of investing in technical aspects like hardware, software, and network requirements.  

 Both entertainment and automotive companies have a need and a desire; tech companies with expertise in both industries can help converge this need. 

Navigating the integration of V2D entertainment

When integrating V2D entertainment with other services and devices, it is crucial to consider various aspects and strategies.

Infrastructure

Vehicles are quickly evolving into digital software platforms, with AI, cloud, and other technologies accelerating the change. By 2030, 96 percent of all new cars shipped worldwide will be connected vehicles. 

The automotive industry is now investing in research on how to apply specific features to its operating systems. Companies need integrated software solutions, services, data, and consumer experiences combined with consumer passion for delivering content to their audience conveniently and engagingly. Combining all these different capabilities with the media streaming supply chain could be challenging.

To create a comprehensive infrastructure for V2D entertainment, companies need the technical expertise to develop and maintain advanced vehicle software technologies and a partner that could deliver tailored solutions for specific challenges.

For example, Nissan partnered with Globant to create an interactive, 3D RT render Visualizer, fully functional on the latest high-end devices. This allows potential owners to experience and interact with the car and its features without physically interacting with an actual vehicle to understand how it works, feel confident they could drive it, and be sure enough to purchase it. The Producers, Artists, and Engineers team and worked closely with our partner on the integration pipeline for asset, model, texture adaptations, and consumer user experience.

A new customer experience (CX) model

Getting in the fast lane of digitalization: 4 trends driving the automotive industry explores how CX is evolving. Today’s CX consists of multiple physical and digital touchpoints in an ecosystem. OEMs (original equipment manufacturers) represent only one dimension of these touchpoints—through their dealerships and repair shops. 

One of the significant shifts of the sector is on-demand, changing from vehicle performance, design, and price, toward more connected, virtual, and responsible experiences as consumers, accustomed to the convenience of smart devices at home or on their mobile phones, are now seeking similar experiences in their cars.

For the automotive industry, physical and digital customer interactions may drive the new customer experience. However, the coordination of multiple parties is needed to build a cohesive and appealing Customer Experience.

An ongoing trend within the industry is a growing focus on the interior design of vehicles, which are being shaped into a more personalized “experience device” through a blend of living and working spaces—for example, seeking to enhance infotainment options. 

This shift is notable in the increased adoption of more extensive, highly interactive screens that extend across the dashboard or are integrated as head-up displays on the vehicle’s windshield, improving safety and convenience. 

The focus has expanded beyond simply incorporating smartphone functionalities into cars; it now encompasses the need for customization options tailored to individual drivers. For instance, drivers may be able to change the color of their cabin lights, and manufacturers might offer additional personalization choices through third-party services like mobile phone manufacturers or wireless network operators. Furthermore, there is an anticipated increase in on-demand subscription services for in-car features and managed over-the-air software updates in the upcoming years.

Audi is one of the brands that has been exploring new ways of enhancing in-car entertainment since June 2022, where back-seat Audi passengers can put on VR glasses for immersive experiences that include games, films, and other interactive content. 

Nissan, for example, is leveraging technology to create a vast ecosystem of services focused on providing a more dynamic in-car experience that includes improved entertainment, convenience, and security. 

Business creativity

TV streaming ad spend in the auto category grew +35% YOY in 2022 vs. +7% YOY in 2021. V2D entertainment is more than a future trend. From an entertainment standpoint, we must consider how to repurpose content.

On a long trip, people might be looking for information about the place they will visit. Where will they eat? What activities can they do there? Are there key sights they should be seeing? People spend a lot of time in vehicles. How can we boost their In-Car experiences? This is when repurposing the content is valuable.

The following are some key examples: 

  • Porsche has partnered with ScreenHits TV (SHTV), a diverse, female-owned media marketing tech company, to provide an in-car portal for Porsche customers worldwide to access TV streaming platforms, as well as premium video content and leading news channels for a number of their vehicles.
  • Cox Automotive and Roku are a partnership that pairs industry-leading data from Cox Automotive with TV streaming data from Roku, America’s #1 TV streaming platform, to measure TV streaming advertising better. Through this partnership, Roku became the first TV streaming pilot partner to offer and market Cox Automotive data for measurement in the TV streaming category.
  • With the introduction of new vehicles, front-seat displays are becoming more relevant. Newer Tesla models feature video content from Netflix, Hulu, Disney+, and Twitchare, which are viewable when the car is parked. 

Unlocking the potential of V2D entertainment

As we enter the era of software-defined vehicles, the boundaries between the automotive and technology sectors are becoming increasingly blurred. From both industries, V2D entertainment can offer new revenue streams and opportunities for innovation. But they need to be strategic. 

Companies must concentrate on their core competencies while getting the best side of this new trend. Car manufacturers must focus on building amazing cars and shouldn’t worry about developing software to stream content. The same applies to media companies; they don’t have to start building cars to make this happen. To take full advantage of current market opportunities, collaboration is the magic world. 

A partner like Globant, who understands both industries and has proven experience and software know-how, could orchestrate this emerging business paradigm.  

Read more about the future of mobility in our new Automotive report, and find out how to adopt AI and gain a competitive advantage in the Media & Entertainment Industry in this report

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