These Four Companies Could Run the Internet of Cars

There has been a lot of chatter about a vehicle-to-vehicle (V2V) communications system that has the potential to make driving safer by preventing accidents at intersections and reduce congestion to make your evening commute smoother.

Most of the talk has centered on what the automakers and their suppliers are up to. Not much has been said about who would actually run the system.

The federal government, strapped for cash and tied up with global issues such as terrorism, probably won’t repeat the role it had when it set up the regular Internet in the 1960s and 1970s before turning it over to the private sector.

Therefore, a consortium of corporations will need to step up to the plate if the Internet of Cars is to take off. Each company and its shareholders would benefit in a different manner from being part of the system.

Four large companies might make up such a consortium.

Google
Google, Inc. GOOG GOOGL seems a logical choice to be part of the effort. The company is already familiar with the myriad technology needed to operate and communicate with automobiles from its development of a driverless car. Google would develop the overall system, i.e. be the “system integrator”, and provide the engineering resources needed. Investors would benefit from the company’s access to the reams of digital data that it could then monetize.

International Business Machines
International Business Machines IBM might run the massive, number-crunching Big Data systems required for V2V. And the company is experienced with interfacing with large organizations in its business-to-business services as well and could be the “manager” of the consortium. Investors would benefit from the service fees IBM receives.

AT&T/Verizon
The V2V system is likely to involve some sort of dedicated wireless network that provides the interface between cars and between cars and a “central” office. The top two wireless providers in the country, AT&T T and Verizon Communications, Inc. VZ, would be an ideal choice to be part of the consortium to run the communications side of the system. The companies would charge for data usage and investors would profit from that.

Conclusion
If the Internet of Cars is to take off a consortium of businesses, and not the federal government, might be involved in running the vehicle-to-vehicle system that would make that happen. Investors of Google, IBM, AT&T, and Verizon would surely benefit from such an effort.

Mark Morelli owns shares of IBM, AT&T, and Verizon.