IoT Shines Light on Telematics

Global commercial telematics is really fascinating. And for those of you paying close attention then you know that the ELD or “electronic logging device” mandate here in the United States is set and the clocking is ticking.

Let’s first take a step back and look at what are telematics. Telematics by definition is a branch of information technology that deals with the long-distance transmission of data. The term may technically be a broad one, but more often than not, vehicle telematics is what people are referring to when they talk about telematics. Vehicle telematics solutions include GPS (global positioning system) vehicle tracking, mobile asset tracking, and connected fleet management.

The benefits of pursuing commercial telematics solutions, say for enterprise fleets of vehicles, include the ability to monitor location and status of fleet vehicles and drivers, alongside reduced fuel costs and improved safety.

MarketsandMarkets,, says things like navigation, communication, safety, and vehicle diagnostics have always been pain points for commercial fleet owners. However, IoT (Internet of Things) technology in the form of telematics has helped enterprises get a handle on their fleets and their drivers through actionable data that can enhance decisionmaking.

In terms of growth, MarketsandMarkets predicts the global commercial telematics market will reach nearly $48 billion by 2020, which is up from about $20 billion in 2015.

One of the reasons for this growth is the dropping costs of connectivity pretty much across the board.

Demand is also increasing as more businesses understand how their companies can achieve ROI (return-on-investment) from a telematics solution. In general, realtime data is becoming an expectation for people in their personal and professional lives. Being able to track vehicles anytime and gather vehicle diagnostics and reporting data in realtime just makes sense for today’s fleet owners.

Then, of course, there are external drivers to adoption, such as the ELD (otherwise known as the electronic logging device) mandate in the U.S.

The final ELD rule from the U.S. Dept. of Transportation FMCSA (Federal Motor Carrier Safety Admin.) aims to improve the safety of commercial vehicles and cut back on the paperwork for fleet owners and drivers.

So, according to the FMCSA, the rule requires:

  1. New technical specifications for ELDs that address statutory requirements;
  2. It mandates ELDs for drivers currently using rods (record of duty status) devices;
  3. It clarifies supporting document requirements so motor carriers and drivers can comply efficiently with hours-of-service regulations;
  4. And it adopts procedural and technical provisions to help ensure ELDs are not used to harass commercial motor vehicle operators.

In places like the U.S., therefore, the regulatory environment combined with increasingly proven ROI (return on investment), is creating an upward trend in telematics solution adoption.

Regulatory compliance is important, but many are turning to telematics devices and solutions anyway because of other benefits.

For instance, being able to detect, document, address, and possibly even prevent driver safety and performance issues is huge. Driver safety in general is something I have written about a lot and have discussed many times on The Peggy Smedley Show, often in the context of distracted driving.

Telematics devices that report back on driver behavior are a constant reminder for employees to be safe behind the wheel. It’s basically a level of accountability that wasn’t there before. For smaller fleets, safety is one of the key selling points for adopting vehicle telematics solutions.

Maintenance is also concern for fleet owners, and being able to keep better track of the wear and tear on a vehicle can promote proactive maintenance, which can reduce downtime.

The latest research on the commercial telematics space backs up what is being discussed here.

ABI Research,, just released a report that says the number of global commercial telematics subscribers will spike, reaching as much as 59 million by 2021.

If we look at what’s been going on in the space, including Verizon’s,, acquisitions last year of Telogis and Fleetmatics, it seems like we’re on the verge of something big. ABI suggests we’re on the cusp of double-digit growth in terms of service revenues, which could exceed $22 billion by 2021.

There is no question we should be on the lookout for more acquisitions and consolidation in the telematics space in 2017.

Some other trends that will help propel telematics toward double-digit growth include the fact that it’s a mobile, IoT world, and more people and more businesses want to be connected.

In fact, people are coming to expect realtime data in both personal and professional contexts. As a result, making decisions in the dark or based exclusively on past data is just not good enough anymore.

Second, businesses desire transparency in an IoT-enabled world—more than they ever did before. Telematics provides the transparency fleet owners and drivers themselves want and need.

And finally, big data. Big data identifies patterns and trends; it can fuel predictive decisionmaking, and that’s huge no matter what business you’re in. Humans waste so much time trying to make decisions with an incomplete picture of what’s really going on.

What if fleet owners could take away a lot of this guesswork? Telematics may seem like a tired subject, since it’s been one of the staples of enterprise IoT for many years, but it’s actually one of the most exciting areas of the IoT.

It’s set up for tremendous growth, and as with everything else in the IoT, more innovation is just around the bend—so don’t be surprised by this rapid growth.

It will be interesting to see how, on a global scale, telematics technology ramps up in the next decade.

Keep an eye on Connected World magazine; one of my writers is working on a feature article that will delve into commercial telematics adoption in emerging markets like Latin America. So buckle up, now is the time for telematics to really take off in the IoT.

Want to tweet about this article? Use hashtags #M2M #IoT #telematics #ELD

By | 2017-02-15T14:05:17+00:00 2/15/2017|

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