The connected car market is undoubtedly growing. Several factors have contributed to the sudden expansion of connected car services available or coming to the market, most notably the expansion of mobile broadband networks, high penetration of smartphones in the consumer market, and auto manufacturers’ re-evaluation of connected services as a competitive advantage and means to generate new revenues.

However, the uptake of connected vehicle services can be constrained by consumer concerns about the privacy and security of their driver behavior and location data. For instance, one nightmare scenario involves a hacker accessing data collected from a vehicle to perceive the driver’s whereabouts (as demonstrated by the Jeep hack earlier this year). If an intruder knows a driver is consistently out of their home at a certain time, that data provides the perfect timing for a home invasion.

Parks Associates research specifically shows over half of vehicle owners in U.S. broadband households are very concerned about the security of their personal driving data, and 55% are concerned about their location data.

To address these concerns, major automakers have voluntarily agreed to a set of privacy and security principles, enforceable through Section 5 of the Federal Trade Commission Act. These principles are important in setting the baseline protections that the auto OEMs can use as a foundation for future protections. Included among these are the following principles:

• Enhance transparency on what data are being collected, used, and shared
• Provide drivers choices about the collection, use, and sharing of their data
• Use and share data in a manner that is consistent with the context in which the data is collected
• Implement reasonable security measures to protect information
• Commit to take steps to ensure the data collected are accurate

Still, lawmakers may want more. In February of 2015, Senator Ed Markey published a report illustrating how wireless technologies exposed vehicles to hackers. He argued automakers had enabled Bluetooth and wireless Internet access in vehicles, without addressing the vulnerability of data collected on drivers, such as location data. As a member of the Commerce, Science, and Transportation Committee, the Senator has called for clear rules to ensure the safety and privacy of American drivers. Automakers will continue to feel pressure not only from consumers, but also the government to protect the data that they collect.

For more in-depth research on the connected car market, see the Parks Associates reports Connected Cars and the Smart Home: Crossover Opportunities and Connected Cars: Revenue Opportunities.

Further Reading:

• Consumers Show Concern over Security Issues for Connected Car Features
• The Connected Car: A Value Chain in Flux
• 61% of car owners prefer to bundle vehicle data consumption with smartphone data consumption

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