Detroit's Information Superhighway

Wireless data is coming to a car dealer near you as Detroit seeks a piece of the Internet revolution.

General Motors (GM) selected Bell Atlantic Mobile (BAM) and GTE Wireless to establish a nationwide wireless network to help it expand its OnStar portfolio of voice and Internet access. At the North American International Auto Show, GM also unveiled the Terradyne concept truck, which features a mobile office environment including a Motorola i1000plus handset that runs on Nextel's network.

"Motor vehicles are more than a method of transport," said Jack Smith, GM CEO. "They are becoming mobile communications platforms that can keep motorists safe, informed and productive in previously unimaginable ways."

Ford announced that it will equip its 2001 vehicles with voice-activated telematics systems such as advanced security features and Internet information access. Ford also has a deal with Yahoo!.

Analysts expect Sprint PCS and other wireless-service providers to team with automakers. Motorola's deal with DaimlerChrysler puts StarTac phones in select Mercedes-Benz models this year.

Current telematics users appear to be pleased with the systems. A survey commissioned by ATX Technologies found that 87% of telematics users surveyed described the services as either good or excellent, while 83% would recommend them to a friend, and 74% want telematics as an option on their next vehicles.

Detroit is bullish on telematics because each vehicle now produces revenues beyond the initial sale and any maintenance at dealer garages.

The convergence of Detroit, wireless and the Internet promises to take telematics to the next level.

"The services that they are offering via the car are extremely valuable, and it won't be long before you have video and everything else," said Andrew Cole, Renaissance Worldwide wireless-practice head.

Cole also expects carmakers to move away from the Sprint PCSs and BAMs and instead leverage an unbranded pipe in order to grab a bigger share of the e-commerce that flows through it. But unlike some analysts, Cole doesn't see tower companies playing a major role in telematics because the heaviest users typically are tooling down the highway where cell sites abound.

"Beyond that, (car makers) will probably do some sexy things on the satellite front," Cole said.

That's good news for GPS makers and location-tracking service bureaus debuting nationwide from several companies.

"Telematics fits hand-in-glove with where location technology is headed overall," said Andy Rimkus, vice president of GPS-maker IDC. "The key here is that (telematics) is going to be expected to be on practically every automobile."