Telematics: Offering Mobile Safety, Security Spurs Additional RMR

Ever since Sept. 11, security has been at the forefront of Americans’ lives. People want to know how to keep themselves safe. Companies want to know how to keep their employees and property safe.

An emerging technology called telematics is becoming an effective method in providing security and safety features to consumers while on the road. Also, in wake of the Sept. 11 events, telematics can provide a means of combating illegal vehicle entry by terrorists and hijackers for companies that have large vehicle fleets.

Telematics converges global positioning systems (GPS) with two-way wireless communication for routing and navigation services, and emergency roadside assistance as well as asset and vehicle tracking, among other extended services.

A good example of telematics is the OnStar service provided by General Motors Corp. to its new customers. Although OnStar is probably the one telematics service familiar to the general public, many other companies are already offering this service or are entering this market.

Within the electronic security industry, a number of central stations are in the beginning stages of offering GPS services – the core service of telematics – to their commercial accounts for asset- and vehicle-tracking purposes.

Offering telematics services to a dealer’s customer base can be yet another way to generate recurring monthly revenue (RMR). It is also another way dealers can maintain customer relationships and loyalty by viewing mobile monitoring services as a critical tool, yet not losing sight of their core business.Although Fragmented, Industry Flourishes

Just as many American homes are becoming “intelligent” because of the technologies that are being integrated, the same concept applies to telematics in automobiles – in essence, making the car into an intelligent mobile vehicle.

At the core of telematics is a control unit and GPS antenna for location and navigational purposes and a cellular phone embedded into a vehicle for two-way communication. The antennas are installed by companies authorized by a hardware provider to do the installations, similar to companies that install car alarms.

With GPS, 24 operational satellites orbit the earth once every 12 hours or so. Three satellites determine a good position when it comes to tracking.

There has been a lot of buzz regarding telematics; however, this emerging market is still considered new and too fragmented to call it an industry.Testing the Waters, Determining Offerings

According to the FBI, car thefts were up 2.7 percent in 2000, after falling 8 percent in 1999. With approximately 208 million registered vehicles on the road and about 115 million daily commuters, the opportunity for dealers to offer telematics services to their existing customers is great, even despite automakers’ offerings. Future providers such as central stations view this as prime time to enter the market.

King-Monital-IDC and ACM in Phoenix are currently testing the waters by providing asset-and vehicle-tracking services to some of their commercial fleet accounts. However, the ultimate goal is to provide telematics services to other accounts as well.

Before its merger with King-Montial, IDC had been offering mobile monitoring services for about three years. As a result of the merger, the central station’s account base has grown to half-a-million accounts.

ACM, with about 58,000 accounts, began offering asset- and vehicle-tracking services 10 months ago to 300 of its commercial fleet accounts to help set itself apart from other central stations, as well as increase revenue.

At press time, Alarm Monitoring Services (AMS) in Metairie, La., was scheduled to hold a seminar in November to officially kick off the offering of telematics services to its dealers.

Security Associates Int’l (SAI) says it is also planning to offer telematics services. It is still in the process of developing its pricing plans, its own software and its command center in Pompano Beach, Fla.Command Centers Require More Training

Because of the GPS satellites involved with tracking purposes, central stations purchase software specifically made for these services. As a result, telematics operators must know a lot more than standard operators about how to handle calls and responses.

Obviously, operators will have the most contact with telematics customers, but dealers should be able to explain the services involved in the different plan packages.Dealers Deemed Well-Positioned for Service

All central stations will have some kind of revenue-sharing program with their dealers. Depending on the number of accounts and dealers a central station has, the additional RMR and enhanced customer loyalty generated by dealers can be promising.

On the dealer’s part, he or she will have to offer telematics services to his or her customers. Other than that, it’s up to the dealer to be proactive and involved with the services. However, the more proactive dealers become without losing site of their core business, the better their chances are at generating RMR. Central stations will provide the monitoring, maintenance and response service.

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