If your car is your refuge from the wired world, look out-a new field called telematics could soon put e-mail, news and MP3s in the driver’s seat with you.

It’s nearly noon in General Motors’ OnStar service center in Troy, MI.

Perhaps 50 people are in their cubicles, peering at computer screens-and while the place isn’t exactly jumping, it hums. A woman on the road in Greenville, TX, wants directions to the Mary Kay center in Dallas. Thanks to the car’s Global Positioning System receiver and wireless connectivity, the OnStar advisor can see a map showing the vehicle’s exact location. She tells the driver Mary Kay is 102 kilometers away, and guides her to the nearest freeway on-ramp. At another terminal things are more urgent: “Mr. [Jones], this is the OnStar center. Your emergency button has been pressed. Are you all right? Mr. Jones, are you all right?” (He is; it turns out the button was hit in error.)

It used to be people got in their cars and were out of touch for however long it took them to get to their destinations. Cell phones changed that-with exceptions depending on coverage zones and interference. More recently, OnStar and similar plans such as Mercedes-Benz’s Tele Aid and BMW Assist have provided built-in wireless links between cars and call centers where operators give directions or summon emergency assistance; some systems unlock doors remotely for locked-out drivers and even provide “concierge” services such as locating the nearest ATM or Chinese restaurant.

But automakers are hoping that what’s available so far is just an appetizer. Faced with dwindling margins and keen to build customer loyalty in the face of intense competition, carmakers are pouring millions into Internet-based systems that would enable drivers to get e-mail, automated directions, tailored news, stock quotes, sports scores, music-even games for the kids in the back seat. At the movement’s heart is a blossoming field called telematics-wireless voice and data communication between a car and somewhere else. Already a $5.3 billion business, telematics could reach $30 billion by 2010, according to Michael Heidingsfelder, partner and senior vice president of Roland Berger Strategy Consultants in Troy, which tracks the auto industry. Calling telematics “the next revolution” in auto electronics, Heidingsfelder says it “will change the landscape of the auto industry in terms of technology content, vehicle design and profit streams.”

Although the vision of car as Internet portal is striking, it’s far from clear how much data people actually want in their cars-or how much they’ll pay for it. Telematics developers still debate the interface-voice or screen or some combination thereof-and whether the proposed flood of offerings will make driving more dangerous. As with any new communications technology, wars over which “standard,” or format, will dominate remain to be fought. But while such constraints will slow the vision’s realization, one thing is certain: the car will never be the same.

Stand Aside, AAA

Telematics was born of technological, economic and societal trends that collided in the mid-1990s. Wireless networks were becoming established features of the telecommunications landscape. Carmakers found themselves facing many obstacles that had confronted computer companies as hardware products became low-margin items and they turned to services to build customer loyalty and profits. Highway congestion and longer commutes led the average American to spend 340 hours a year in cars as a driver, 201 as a passenger. Combine, and presto: the auto becomes an extremely compelling marketing target for information technology services.

First onto the track was Ford Motor. In 1996, it offered Lincolns with “RESCU”-mainly for emergency assistance. But Ford expanded slowly, and GM roared into the lead. Initially an option on three 1997 Cadillac models, OnStar is now offered on 32 of GM’s 54 North American brands, and the company plans to extend it to all its cars. GM jealously guards OnStar revenue figures. But when you figure the basic price is $199 a year (first year free) and $399 for premium service, that’s a heady potential windfall. Which may explain why a host of competitors have come out of the pits.

It also provides compelling reasons to tap Internet services that could both attract more customers and also hold down costs by automating the system-two keys to making telematics profitable, which it won’t be until carmakers achieve the economies of scale needed to pay back their massive investments in the telematics infrastructure. Online automotive services fall into three main categories: productivity, convenience and entertainment. The first includes such things as e-banking, stock quotes and audible e-mail. Convenience covers route-guidance, weather information and news and sports updates. Entertainment includes MP3 music, games and movies.

The basic idea in all three categories is to use the vehicle as a “thin client” that carries the essentials for wireless communications-antenna, receiver, transmitter and the like-but does not have expensive storage or processing power. Instead, subscribers go to a special Web site and fill out a personal profile that lists the e-mail accounts and other information they want. Computing is handled by remote servers, so upgrading software and adding new services doesn’t require changes in the vehicle.

But while the thin-client model is near universal in telematics, systems from different carmakers vary wildly in their details-particularly the interface. A driver uses OnStar, for example, by pushing one of three buttons and talking to an operator or to the automated system via speech-recognition software, with responses coming through the vehicle’s sound system. But some competitors believe a voice-only interface is not enough. It’s here the vision becomes most fun-and fanciful-as the Internet-enabled concept car takes to the road.

Portable Portal

Take Quick-Scout, a telematics package Siemens Automotive hopes to deploy commercially in 2002. Siemens wants to offer people a visual interface with their wireless services. But building a liquid crystal display into the dash is expensive, so the company plans to borrow a display-and storage and processing power-from a Palm Pilot or other handheld device that would slip into a docking cradle.

That would not only hold down costs but also provide in-vehicle access to electronic address books, phone lists and schedules. It would also offer more seamless connection between the car and the rest of the driver’s life-since whatever was downloaded in the vehicle could be carried outside, and vice versa. “That’s where we think we’re going to get the high take rates,” says Harry Asher, senior engineer for Siemens Automotive’s Driver Information Systems group in Auburn Hills, MI. “With a system like this, the car in every way can become like a portal to the Internet and the world.”

Siemens already has prototype versions of the system running. Slide a Palm V into a cradle mounted in front of a Dodge Durango’s main console, start the car and the telematics program springs into action. Four choices appear on the Palm’s screen: Navigation, Traffic, News, Messages. Turning and pushing a knob on the cradle-or soon a simple voice command-selects the choice you want.

Say you need directions to an appointment. Select Navigation. The Palm shows various submenus: Address Book, Points of Interest, Street Addresses and Recent Destinations. No matter which submenu you choose, you can either enter an address directly or just the first few letters of your contact’s name, and Quick-Scout will scour the Palm’s directory and flash the corresponding address on the screen. Accepting the address starts things going: “Calling service provider,” a tinny voice reports.

Instead of linking to a call center and having you talk to an operator-humans are both expensive and a potential bottleneck if telematics systems and services expand as anticipated-Quick-Scout locates your position by GPS and sends a request to an information services provider. The service company’s system calculates the route and downloads turn-by-turn directions-all in about 40 seconds. To help you get oriented, the Palm screen first presents an area map of your location. Once you’re moving, the scene shifts to a closer view of the street you’re on, with big arrows showing the correct route. Voice prompts help ensure you get things right: “Please make a legal U-turn ahead.”

In the same way, you can access traffic information, news and messages, including e-mail, which Quick-Scout renders aloud. And, says Asher, the system won’t lock you into one automaker’s vehicles, as OnStar does.

DaimlerChrysler also likes visual displays. Last fall, Mercedes-Benz’s Tele Aid began making Internet-based services such as stock quotes and news accessible as text displayed on the dashboard screen that is already standard on luxury cars for things like navigation and audio control. (OnStar made similar features available nationally this year with its speech-only Virtual Advisor option.) But as costs fall, DaimlerChrysler hopes to offer similar services on more mainstream vehicles.

One big focus of DaimlerChrysler’s current telematics R&D is entertainment. A Dodge MAXXcab’s back seat boasts two kids’ stations, each with a video-game controller, and a shared central screen for playing games or watching movies. Steve Buckley, DaimlerChrysler’s manager of electric product innovation, demonstrates how a prototype ultrasonic loudspeaker technology from MIT’s Media Laboratory called the audio spotlight can create up to four audio zones-for the driver and three passengers-that are effectively inaudible to each other. “If your child’s watching the latest Pokmon movie in the back seat, I don’t know about you, but I don’t want to hear it in the front seat,” he says. “I want to play MP3 files.”

Similar systems are central to just about everybody’s car of the future-and even though the jury is still out on their exact form, autos are undergoing a transformation to get ready. Many new cars have already become antenna farms, carrying separate aerials for AM/FM and GPS, and two for dual-band cellular. Coming down the pike are antennas for satellite radio, short-range wireless and maybe TV.

All this sets the stage for even more exotic telematics applications. Many automakers expect that eventually every car will monitor its own systems. If your vehicle notices a problem, it may communicate that information to your garage, and even consult your calendar to schedule a convenient service appointment. Sensor data about the car’s speed and location might also be used to update traffic reports. And telematics gurus gush about the “information filling station.” Bandwidth suffers when the receiver is in motion, limiting the amount of data deliverable to a moving car. So one idea is that when you pull up to a gas station or convenience store your car could also fill up with information using a short-range wireless protocol such as the already available 802.11b standard. Says OnStar’s chief technology officer Dennis Walsh, “When [the car] is stationary you can access local networks of malls, loading music and so forth.”

I Brake for Reality

Such possibilities make for heady times from Detroit to Munich. But several issues could roadblock telematics’ promise. None is potentially more important than legislative efforts to curb driver cell-phone use for safety reasons. Portugal has banned drivers from using mobile phones, even headset or speakerphone models, and several European countries enforce hands-free rules. Similar action in the United States-especially if it limits how much data drivers can receive-could put the brakes on telematics development.

All car companies are expressing concern. Last fall, Ford Motor announced plans to build a $10 million simulator lab at its sprawling research facility in Dearborn, MI, to study how much information and what type-aural or on-screen-drivers can safely handle. Explains Mike Shulman, principal staff engineer of Ford’s vehicle electronics systems department, “What we worry about is this ‘cognitive load’ that people talk about….We worry, what is that going to do with safety?”

Industry watcher Heidingsfelder argues that the fact car companies are only now seriously asking such questions may slow telematics’ adoption. And there are other curves in the road ahead. Making the technology robust is one, acknowledges DaimlerChrysler’s Buckley. “The concept cars, we never drive them over 39 miles per hour. But do high bandwidth and voice recognition work as well at 70 mph, with the windows down?” There’s also the question of what people actually want. The automakers’ consumer studies show widespread interest in navigation and emergency assistance. But paying extra for Internet access or e-mail interests far fewer drivers.

This is why, grand visions aside, some in the field feel telematics will evolve along the same lines as airbags or antilock brakes: essential, good selling points, but rarely used. “Some people buy an airbag system, and they never experience it their whole life, but by God they wouldn’t buy a car without it,” says Ralph Wilhelm, the recently retired product-line manager of worldwide telematics for Delphi Automotive Systems, a prime supplier of OnStar’s inner workings. The same, he expects, may hold for telematics, with people using it in a pinch, but avoiding most applications.

In some senses, it hardly matters. Because either way, more applications are coming-and for better or worse the car will be increasingly linked to the rest of our information-rich lives. Which means hitting the road to get away from it all will be harder and harder to do. Unless you want a quiet place to check e-mail.