Microsoft, Accenture To Sell Software To AutomakersMicrosoft, Accenture To Sell Software To Automakers

Microsoft and consulting firm Accenture will jointly develop and sell automotive telematics software and services to carmakers and related suppliers.

The systems, which put wireless computers into cars and trucks, are best known in consumer incarnations such as OnStar, the General Motors Corp. service that provides drivers with navigation help, emergency assistance, and information services such as stock quotes. With this venture, Microsoft and Accenture aim to expand the nature of those services and make them easier to implement.

"Everyone talks about consumer applications, but we believe the potential for telematics is just limitless," says Umar Riaz, partner with the automotive industry group at Accenture. He says the partnership will also examine more business-oriented applications, including tracking truck drivers and letting gas companies remotely charge for fill-ups. "The insurance industry is very interested in being able to monitor driving behavior and usage, which would enable them to price their premiums more accurately," he says.

The two companies will jointly develop complete telematics systems, picking out everything from hardware to software platforms, and will work with automakers (focusing on the top five) to set up the systems in new cars, says Gonzalo Bustillos, director of business development and marketing for the automotive business unit at Microsoft. Data services for the systems will be delivered through Microsoft's Car .Net initiative, he says, and its Windows CE operating system will also figure prominently.

The automotive telematics market is set to boom, says Meenakshi Ganjoo, Frost and Sullivan automotive analyst. "It's a market that is in its infancy at this stage," she says, "but by 2006, telematics products and services will be worth close to $7 billion." Ganjoo says commercial applications (like OnStar) will lead that growth, but business applications will take off quickly as companies see their value.