China's TSP industry, small and medium-sized enterprises are declining due to intensifying competition, 4-5 giants are expected to be born by 2025

Small and medium-sized TSPs will decline, and TSP giants will come to the fore.

With the expansion of "smart cars as a service", automakers are focusing on the introduction of technologies and platforms such as big data, cloud computing, security, content platforms, and artificial intelligence, and more intelligent and diverse content. We are expanding the OEM market while providing value-added services. As a gateway to car traffic, Telematics Service Providers (TSPs) will move from early remote services to telephone mirroring, connectivity, connected IVI systems, and ultimately, integrated telematics systems that cover people, cars, and lives. By constantly expanding service content and boundaries, we are responding to changes in the industry.

There are four typical types of TSP. OEMs, carriers, internet / technology companies, and third-party platform providers. These players are building a multiplayer partnership. For example, OEMs are partnering with BATH, Pateo and others to enhance their telematics development and service delivery capabilities, and are working with carriers to explore 5G + telematics application scenarios and application ecosystems. In the long run, the four major participating companies will integrate across disciplines to build a win-win partnership.

In the future, the TSP industry in China is expected to move in the following directions.

1. By connecting cars and people, other cars, smart appliances, living services, smart cities more closely, TSP will expand services, open up technology and ecosystem, mobile phones, cars, homes, cities. We are trying to gradually cover all the scenarios of.

For example, based on the expanded BATH ecosystem (Baidu, Huawei, Tencent, Suning, Ping An, UnionPay, China Telecom, etc.) and third party ecosystems, Pateo will be used in mobile, car, home and city scenarios. We are developing and plan to add "5 new businesses" (New Mobility, New Finance, New Retail, New Insurance, New Marketing).

2. When cross-disciplinary integration becomes commonplace, players will realize complementary advantages, resource sharing, ecological integration, and ultimately build a large ecosystem.

For example, Baidu, Alibaba, Tencent (BAT), etc. are building close partnerships with OEMs in more areas. In it, Alibaba reunited with SAIC in late 2020 to establish IM Motors, which is responsible for the development of smart electric vehicles.

3. OEM leads TSP to provide better IVI system-centric service.

OEMs now share a common understanding of intelligent connectivity and accelerating digital transformation. To retain core technology and data, Geely, Great Wall Motor and Honda China have set up a telematics company, either independently or in collaboration with other companies, at the core of its multi-disciplinary deployment of IVI systems.

4. In the face of intensifying competition and new restructuring in the telematics industry, TSP is expected to have four to five giants by 2025.

Today, most of the traditional TSPs have been acquired by millionaires and integrated into other businesses. There are only a handful of TSPs that can be run independently. Even Baidu, Alibaba, Tencent and Huawei (BATH) can each deploy only one of dozens of intelligent connected vehicle product lines. As OEMs regain their software development dominance, TSPs will face more fierce competition and new restructurings. By 2025, it is expected that there will be four to five Bellweathers developing full-stack telematics systems and capable of linking vehicles with V2X equipment, earphones, watches, bracelets and various IOT devices. I am. Small and medium-sized TSPs will be driven by TSP giants.

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