The unprecedented explosion in telecommunications technology in general and the Internet of Things (IoT) and mobility specifically is revolutionizing the fleet management sector. It is happening on the business side as well: The tie between fleet management and telecommunications is being cemented with Verizon’s purchase of an important fleet management vendor.
The evolution of the past decade seems tailor made for fleet management. Fleets are mobile, so the increasing sophistication of tablets and smartphones obviously makes data, audio and video communications tools useful to the industry sector. It goes beyond that, however, as purpose-built management tools, many based on the IoT, allow companies to do things that were impossible just a few years ago. These include identifying vehicles that are being driven in a wasteful or unsafe manner. The IoT also can raise yellow flags when a vehicle is about to encounter mechanical problems.
In addition to the fact that the technology and business relationships are falling into place, the connection between telecommunications and fleet management is being pushed by new regulations. Susan Beardslee, a senior analyst at ABI Research, told IT Business Edge that Electronic Logging Devices (ELD) mandates will require long-haul fleets to transition from manual to electronic tracking of a vehicle’s hours of service and the driver’s record of duty status.
Beardslee said that the regulations will take effect for trucks currently without any electronic devices on December 18 of next year. Trucks with non-compliant equipment will get until December 18, 2019 to upgrade.
“The big picture is that the regulations are going to drive mass adoption … because companies’ fleets that have not had connected vehicles before now will have to have them,” Beardslee said. “It’s mostly small and medium size companies.”
These ELD rules are for long-haul truckers. Things are changing on the local level, as well. Sophisticated communications tools enable better route management and such clever tricks as coordinating routes so that technicians with specialized skills are more likely to be where they are needed. Such platforms allow companies to hit tighter appointment windows, which is particularly important to the cable industry’s efforts to improve its public image.
Fleet management is a broad area, and one that is changing.
“FM are showing a greater interest in a number of areas outside the vehicle,” wrote Felix Lluberes, KORE’s executive vice president for Advanced Applications in Latin American Sales to questions emailed by IT Business Edge.
“One case is the increased interest in understanding the driver behaviors; mainly to increase safety, operation efficiencies and proper vehicle use. Other areas are related to fleet activity and road, mobile solutions for order processing and in vehicle inventory management.”
Berg Insight took a look at the worldwide fleet management segment. This summer, the firm found that the installed base of fleet management systems in the Americas will pass the 16 million mark by 2020. The number of systems deployed in North America in the fourth quarter of last year was 5.8 million, and the compound annual growth rate is 17 percent.
The segment has several players.
“The largest providers in North America are Fleetmatics, Trimble, Omnitracs, Geotab, Zonar Systems, Verizon Networkfleet, Telogis and Teletrac Navman,” according to analyst Rickard Andersson. “Notable developments include Verizon's acquisition of Telogis and Fleetmatics in 2016 which positions the North American operator as the largest fleet management provider in the world.”
The biggest news in the sector during the summer was the acquisition of Fleetmatics Group by Verizon Communications. The purchase price of the deal, which was announced on August 1, was about $2.4 billion. Dublin-based Fleetmatics said at the time that it has more than 37,000 customers, about 737,000 subscribers and employs 1,200 people.
This is far from the first foray of Verizon into fleet management. At IoT Evolution, James Brehm, the CEO and chief strategist of James Brehm & Associates, goes through the history. He writes that three years ago, Verizon bought Hughes Telematics. That was followed by the purchase of Telogis in June and then, finally, Fleetmatics. Brehm is not a fan of the deals. He suggests that Verizon overpaid and has built in churn, since about 20 percent of the vehicles Telogis manages belong to AT&T:
Do you think AT&T will want Verizon knowing where their fleet vehicles are driving to and from each day? Probably not. Look for some immediate churn to happen.
The relationship between the telecommunications industry and fleets was always tight because the two industries play to each other’s strengths. The evolution of technology, as well as Verizon’s strong pursuit of the industry, is making that bond even deeper.
Carl Weinschenk covers telecom for IT Business Edge. He writes about wireless technology, disaster recovery/business continuity, cellular services, the Internet of Things, machine-to-machine communications and other emerging technologies and platforms. He also covers net neutrality and related regulatory issues. Weinschenk has written about the phone companies, cable operators and related companies for decades and is senior editor of Broadband Technology Report. He can be reached at firstname.lastname@example.org and via twitter at @DailyMusicBrk.