Telematics: Everything you need to know

Often eulogized and considered to be the next big thing in the in-car electronics, this cool-techie sounding technology: “Telematics”, seems to hold great promise in the automobile electronics future and shows us just how blooming this sector really is, however, with introduction of Digital cockpits all the features that are specific to Telematics are now integrated part of the system.

The Basics:

So what is it really?

The word itself is the amalgamation of two French words télécommunications (“telecommunications”) and Informatique (“computing science”), which plainly means the transfer of information over telecommunications.

Telematics is an interdisciplinary field or a field relating to more than one branch of knowledge, that encapsulate telecommunications, vehicular technologies, road transportation, road safety.

Basically, It refers to a method of capturing and processing driving data, and there are a huge number of potential applications.At the moment its most commonly used for pricing insurance in a way that rewards safe driving. If you sign up for the telematics policy, the insurance installs one of the so-called “BLACK BOX” in your car underneath the bonnet,which then measures and affectedly send your  driving data to your insurer for marking and scoring you on how safe you are by analyzing when and where you drive and your driving style ,how fast you are going or how many times you use the brakes, simply-put, how well and safe you drive. And if you drive well enough you can get a discount on your insurance giving you truly personalized car insurance price.


The main components of a Telematics System are as follows: 

Telematics Control Unit(TCU): It’s roughly the size and weight of a paperback book. It’s designed with heat and vibration shielding, so it could be mounted anywhere theoretically, including in the engine compartment. Although, the exact positioning depends on the model of car.

Wireless Communications Infrastructure: “Wireless infrastructure” is a term generally associated with the equipment and environment needed to make cellular communications possible.

CRM System: CRM or Customer relationship management is an approach to managing a company’s interaction with current and potential customers.


The Main Hardware Component: BLACK BOX

A black box is a device which is hard fitted into the car is probably the best-known way of capturing this data although other options are also available.Mobile apps can be used for telematics or you can plug devices into the lighter socket or other ports in your car.They capture quite a bit of data which is useful not only for insurance companies but for the drivers too.

Now, What’s inside the box?


Usually there are 4 main elements to the telematics box that they fit inside your car:

GPS System

Wel, we all are aware that GPS or Global Positioning System is a network of orbiting satellites that send precise details of their position in space back to earth. The signals are obtained by GPS receivers, such as navigation devices and are used to calculate the exact position, speed and time at the location of the vehicle.

GPS is well-known for its military uses and was first developed by the US to aid in its global intelligence efforts at the height of the Cold War.

Ever since the early 1980s, however, the GPS has been freely available to anyone with a GPS receiver. Airlines, shipping companies, trucking firms, and drivers everywhere use the GPS system to track vehicles, follow the best route to get them from A to B in the shortest possible time.

Motion sensor (or accelerometer)

A motion sensor is usually an accelerometer which is used to generate the profile of the driving by analyzing the acceleration, braking, jerk, rough road etc.

SIM Card

SIM stands for subscriber identity module or subscriber identification module. It basically sends the information to our database from the machine in use and vice versa.

Also, a SIM card contains unique information that identifies it to a specific mobile network, which allows the subscriber (like you and me) to use the communication features of the device.

Its almost impossible for some Phones to make calls, send SMS messages, connect to mobile internet services (3G, 4G, etc.) or even to function properly if the SIM card is not present.

Although, SIM also stands for “simulation,” and might refer to a video game that simulates real life that’s not our prime concern here.

.The M2M (machine to machine) SIM Management Software used here is Cloud-based, is easy to use, easy to integrate and adapts perfectly to the business processes of the users.


Telematics software

Under the “telematics” umbrella, is the integration of the computers, mobile devices and  GPS or “The Global Positioning System”. The telematics system encapsulates the telematics services described above, and more. Basically, the web services for providing access to TCU service data to the call centers, the network management module for managing and monitoring the TNOS, the application servers hosting the telematics services and maintaining the states of all the telematics service instances persistently.

The telematics system can be hosted on an enterprise-grade system that can be scaled as the number of users grows and does not compromise on performance while providing high reliability and geographic redundancy.

Alright but what about privacy? What does the box record?

The data from a black box basically tells the company about:

  • the time of day or night you drive.
  • the speed you drive at on different kinds of roads.
  • if you brake or accelerate sharply.
  • if you take breaks on long journeys.
  • your motorway miles.
  • your total mileage etc.
  • Some of the latest black boxes can integrate Camera aswell.


Leading Companies:

Octo Telematics

Founded in 2002, this, London-based, global provider of telematics and data analytics solutions for the auto insurance industry is considered as the largest and most experienced insurance telematics company in the world.Though the most recent EUR405 million deal between Octo and Renova Group, in which Renova bought Octo for more than $550 million, Octo still is transforming the entire auto insurance realm through behavioral, contextual and driving analytics for more than 60 insurance partners.

As announced on Oct. 11, 2017, it even has completed its acquisition of the usage-based insurance (UBI) assets focusing on forming a strategic alliance with of Willis Towers Watson, working on advancing UBI data analytics through algorithms and tools to provide insights to the insurance industry.The financial details of the transaction were not disclosed.

The global demand for UBI is growing rapidly and is predicted to reach 93m global policies by 2020. With the continuous development of new products and services to address the evolving market’s technology and mobility needs, It was Octo Telematics Surpasses Three Million UBI Telematics Policies in North America.


The name “Vodafone” needs no introduction but few knew that it is aiming to provide telematics technology to support a usage-based insurance offering from UK company Admiral.

The scenario sees Vodafone supply hardware, connectivity, data management, crash analysis and safety-related services for the insurer’s LittleBox solution.

The LittleBox service, which launched in 2013, offers drivers discounted car insurance premiums based on analysis of their driving behavior. Admiral said it had 200,000 customers using its telematics services, which are not limited to LittleBox.It collects driving data that the customer can access through a dashboard, which provides a driving score and offers hints to improve driving.Vodafone even has won the deal from Octo Telematics, European Communications understands.

Vodafone Director of Automotive Gion Baker wisely said recently that: “The advantages of telematics technology is being felt well beyond the car.


Founded in 1991, is best known for being a global leader in navigation and mapping products.Known to create the state-of-the-art fleet management solutions and industry-leading location-based products, they are now recognized as a leading provider of telematics solutions, with over 350,000 subscriptions worldwide.


Scope In India

As per the analysts TRN Ltd, India’s investment plans of more than 1 trillion US$  over the next several years on Indian telematics industry surely hints us about how promising and blooming this sector actually is.
With increasing number of accidents/vehicle theft, demand for vehicle navigation, and the rising need to monitor fuel and optimizing its cost, the market for telematics has propelled in India.

India has seen major advances in the field related to the industry such as explosive growth in organized cab services and ergo the increasing need of fleet management and other in areas of similar sorts, have together shown promising start and are expected to fuel the adoption of telematics devices in the country. According to 6Wresearch, India telematics market is projected to touch $301.23 million by 2021.

Although as fascinating as it is, the concept still needs to be pitched into the market on a bigger scale as many are still aloof from the subject.



The Future It Holds

On the Global scale, the automobile industry is integrating and deploying telematics tech to monitor vehicle performance and identify defects in vehicles, also providing for the demands of wireless connectivity from the customers. Telematics also have other uses.For Instance, Telematics is primarily used for usage-based insurance (UBI) in the United Kingdom. The device actively collects the way a driver drives the car. The insurance company then takes this data, along with the location and other information, to grade and simultaneously monitor the user’s driving skills.

Succeeding that, data analytics systems are deployed to analyze the driving styles compared with historical data that is already available in the data warehouse and at other cloud storages. Based upon this, the insurance premium is adjusted. In the US, Telematics devices are used to provide services to drivers based on their location. In case of an accident, medical help can, therefore, be arranged fast and in real time.

It is projected that while its penetration in the United States of America and Western Europe will cross the 80% mark by the year 2018, developing areas such as Latin America and Eastern Europe will also witness a sharp increase in the use of telematics in the new vehicles.

According to the, This statistic presents the market size of the telematics insurance markets worldwide in 2015 and a forecast for 2020. As of 2016, the global telematics insurance market was projected to grow to 2.2 billion U.S. dollars by 2020.

Take a look!

Market size of the telematics insurance market worldwide from 2015 to 2020 (in million U.S. dollars).



Plausible Benefits

With telematics-based insurance, for example, you’ll get a custom dashboard where you can track your journeys and driving scores, plus you will get feedback to help make your driving safer.This, in turn, will hopefully help lower your prices even further, Everyone Wins!

Also, Some technical benefits include:

Wireless vehicle safety

Telematics aid in car safety and road safety. It uses an electronic sub-system for the purpose of exchanging information about drivers safety and things such as road hazards and the locations and speeds of vehicles, over radio links.

 Warning systems

Emergency warning systems for vehicles telematics are developed particularly for international harmonization and standardization of vehicle-to-vehicle.They are self-orientating open network architecture structures of variable programmable intelligent beacons developed with the intent of generating warning information with surrounding vehicles in the vicinity of travel.

 Fleet management

Fleet management is the management of a company’s fleet. This includes the management of ships and or motor vehicles such as cars, vans and trucks, driver management, fuel management, health, and safety management and dynamic vehicle scheduling. Its basically, is a function which allows companies which rely on transportation in their business to remove or minimize the risks associated with vehicle investment, improving efficiency, productivity and reducing their overall transportation costs.

 Vehicle tracking

Vehicle tracking is monitoring the location, movements, status, and behavior of a vehicle or fleet of vehicles. This is achieved through a combination of a GPS receiver and an electronic device.

 Trailer tracking

Trailer tracking is tracking the movements and position of an articulated vehicle’s trailer unit through the use of a location unit fitted to the trailer.

 Container tracking

Freight containers can be tracked by GPS using a similar approach to that used for trailer tracking i.e. a battery-powered GPS device communicating its position via mobile phone or satellite communications.

And there is a great deal of scope for other useful functions.Your device could alert emergency services if you are in a serious accident for instance, Or send Diagnostic data to your breakdown recovery service if you get stuck.It can be helpful in paying toll payments.So, all in all, its quite right to assert that the ways in which telematics could ultimately help drivers, is limitless.


Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.