How Vehicle Connectivity Becomes a Business Model

Customers expect their cars to have up-to-date, connected functionalities. Vehicles, especially electric cars, increasingly rely on connected services such as in-car entertainment, online navigation, and vehicle diagnostics. Even seemingly basic functions like unlocking the car door are often controlled via mobile apps in modern cars.

But who pays for the connectivity that enables these services? Often, it is the car manufacturers who bear these costs because monetising mobile data streams is not part of their core business. Passing these costs on to customers proves complex due to several challenges:

• Complexity of billing and payment: Managing a seamless and user-friendly billing process for various subscription models is a challenge, especially when integrating different payment systems and subscription tiers.
• Compliance with regulations and laws: Adhering to strict telecommunications regulations, such as GDPR and KYC processes (= Know Your Customer), is mandatory but complicated. Non-compliance can lead to legal issues and fines.
• Management of different communication services: The need to effectively manage different types of data, such as telemetry and vehicle maintenance data compared to entertainment and online traffic information, over the same SIM card requires advanced separation of data streams.

Integrated Platform for Monetising Connected Services

To overcome these challenges, Freeeway has developed the IoT Monetization Hub. This platform offers an integrated solution for car manufacturers and other companies alike to enable connected services in a paid model. The IoT Monetization Hub facilitates seamless integration, billing, and management of connected services while providing the flexibility to offer end users different subscription models. The robust connectivity of KPN IoT underpins the platform and enables effective management of these data streams. Freeeway's technology and KPN IoT's connectivity, along with established relationships and experience with automotive OEMs such as Tesla, ZF, and SAIC-MG, form a strong combination to enable the monetisation of data streams generated by in-vehicle services for end users.

The IoT Monetization Hub provides manufacturers with the tools they need to effectively monetise their data streams. This platform enables the creation of flexible subscription models that meet the needs of end users and take into account the complexity of billing and payment, regulatory compliance, and the management of various communication services.

Simple onboarding via eSIM chips

Onboarding vehicles onto the platform is straightforward. During production, the eSIM chips are installed in the vehicles and paired with the Vehicle Identification Number (VIN). Once this is done, the SIM profiles are loaded. This ensures that each SIM profile is uniquely linked to a specific vehicle, which is crucial for managing data subscriptions and providing targeted services after the vehicle is sold. This information is fed into Freeeway's software solution to determine which SIM card is active in each vehicle later on.

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When the end user buys the car, they register their VIN and activate their preferred subscription via a user-friendly interface, myFreeeway. At the same time, the IoT Monetization Hub activates the SIM card in the underlying mobile network to enable mobile data connections for the desired services.

The IoT Monetization Hub from Freeeway can either operate completely independently of the OEM's northbound systems or be integrated into the OEM's tools and processes, depending on preference and operating model.

Flexible Microservices and Integration

The technical architecture of the IoT Monetization Hub is built on a current microservices structure. This allows for easy integration into existing manufacturer systems and ensures flexibility, so the service can be tailored to different customer needs. Freeeway uses an API-first development approach, meaning all services are available via APIs. This enables easy integration with external applications and increases the platform's flexibility and scalability.

Subscription Definitions

One of the main advantages of the IoT Monetization Hub is the freedom it offers OEMs in designing their own subscription models. Manufacturers can configure either monthly data subscriptions, annual subscriptions, or special premium services such as real-time traffic information and in-car entertainment. Thanks to this flexibility, manufacturers can tailor their services to the specific needs and preferences of their customers, leading to higher customer satisfaction and increased revenues.

Payment Process and Subscription Billing

The IoT Monetization Hub fully automates the payment process and billing. Subscriptions are automatically renewed and billed based on usage and preset limits, ensuring a seamless and efficient process for both the manufacturer and the end user.

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How does this work in practice? When a user activates a subscription, the payment is processed through a reliable payment provider. Freeeway collaborates with reputable payment providers to ensure smooth transactions. The Freeeway Hub automatically generates invoices based on actual service usage and subscription limits.

Freeeway has designed the billing and payment process to be secure and efficient. When the end user activates a service, such as a monthly subscription for in-car entertainment, the first payment is sent via a secure API to a payment gateway. This gateway communicates with various banks and financial institutions to process the payment. Meanwhile, Freeeway's system tracks the subscription usage and dynamically generates invoices that account for any subsequent subscription renewals, eliminating the concern of manual payments or renewals for both the manufacturer and the end user.

Additionally, the IoT Monetization Hub can generate detailed reports on the usage of subscriptions, providing manufacturers with insights into how their services are used and where optimisations are needed.

Effective Data Management

As previously mentioned, one of the biggest challenges in the automotive IoT ecosystem is the need to manage different types of mobile data streams. Some of these data streams serve the OEM itself, such as telemetry data used for vehicle maintenance and safety. Another data stream relates to the data generated by end-user services like entertainment, Wi-Fi hotspots, etc. Both types of data streams are enabled via the same mobile data connection and thus via the SIM card. The challenge in billing mobile data is to distinguish between the two different data streams and only charge the end-user for the traffic generated by end-user-related services.

Through the collaboration of Freeeway and KPN IoT, this process of 'Split Billing' (the term used in the telecommunications industry for the differentiated billing of multiple data streams) is implemented on the mobile network side and managed by the IoT Monetization Hub.

This means the platform can differentiate between various data streams and ensure they are processed and billed separately. The Freeeway Hub and the setup of the KPN IoT mobile network enable manufacturers, for example, to separate telemetry data from entertainment services for end users without affecting the vehicle's operational data requirements. This capability directly addresses the challenge of managing and separating different communication services, ensuring smooth and efficient operation for both manufacturers and end users.

Localisation of Content

Entertainment content is typically localised for respective markets. The same applies to the automotive industry: Netflix streaming content in the car should be tailored to the end user's location. For digital services, this is usually done by analysing the device's IP address, in our case, the vehicle's. When the end user registers their vehicle, the IoT Monetization Hub ensures that the SIM card built into the vehicle receives an IP address from the country-specific pool, depending on the end user's place of residence. This solution was developed by KPN IoT and is fully integrated into Freeeway's IoT Monetization Hub.

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KPN IoT is Freeeway's most important partner in providing the mobile network connectivity required to connect Freeeway's devices and vehicles to the internet. In addition to its own mobile data networks, KPN IoT has entered into roaming agreements with more than 600 networks worldwide to ensure seamless connectivity regardless of the vehicle's location. This seamless connectivity is crucial for addressing the challenges of managing different types of communication services within the IoT ecosystem.

This is particularly important for manufacturers exporting vehicles to different markets to ensure that connected services remain operational without network interruptions. "As a manufacturer, you cannot afford reputational damage due to poor connectivity during holidays or long journeys," says Mark van den Berg, Strategic Business Developer at KPN IoT.

Another aspect that can damage a manufacturer's reputation is the violation of data protection laws. Compliance with the General Data Protection Regulation (GDPR) is crucial for companies processing personal data of users in the EU. Freeeway and KPN have implemented robust measures to ensure that all data is handled carefully and in compliance with the GDPR.

Freeeway and KPN IoT ensure GDPR compliance by:

• Informed consent: Users give their explicit consent before personal data is collected or processed.
• Data minimisation: Only necessary data is collected and processed.
• Secure data storage: Data is stored with ISO-certified partners.
• User rights: Users can exercise their rights under the GDPR, such as the right to access and deletion.
• Data encryption: Processed and stored data is encrypted for additional security.
• Secure network connectivity: KPN IoT ensures that all data transmitted over its networks is securely encrypted and protected from unauthorised access.
• Anonymous data: Data is anonymised wherever possible to protect privacy. KPN IoT does not access data that can identify individual users. Data on data usage and connectivity is collected without linking it to specific individuals or vehicles.

Continuous Innovation

Freeeway and KPN IoT are committed to continuous innovation to ensure their joint solutions remain at the forefront of IoT monetisation. By combining Freeeway's IoT Monetization Hub with KPN IoT's robust connectivity services, they offer a solution that enables automotive manufacturers to turn connectivity costs into a sustainable revenue source. The partnership between Freeeway and KPN IoT is not just about technology, but also about creating value for customers through continuous innovation and adaptation to market needs.

Furthermore, they are exploring new markets and sectors where the IoT Monetization Hub can add value. This includes expanding into smart home solutions and other IoT-driven industries.

The future of connected services lies in continuous innovation and adaptation to market needs. Freeeway and KPN IoT are constantly exploring new opportunities to enhance customer success and transform data from a cost centre into a valuable asset that contributes to growth and success. 

This article, first published on all-electronics.de, is based on documents from KPN and Freeeway. 

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