Long after BlackBerry has all but disappeared from the smartphone market in the U.S., it’s managing to win the connected car war. QNX, the wholly owned subsidiary of the former smartphone-giant, quietly marked a milestone this year, shipping its 60 millionth vehicle equipped with its CAR operating system, the infotainment platform it builds and licenses to nearly every automotive manufacture.
If you haven’t heard of QNX, there’s a reason for that. QNX is an embedded operating system that powers a sizable percentage of the infotainment systems running in late model vehicles. However, there is no “out of the box” QNX-branded solution on the market. They carved their sizable niche in the automotive industry over the past 15 years by offering manufacturers the building blocks on which it can create a branded infotainment system. Think: GM’s MyLink, most versions of Toyota’s Entune, and Ford’s next generation of Sync–they are all powered by QNX.
This year earning notoriety will become even more challenging as the spotlight shines on Android Auto and Apple AAPL -0.96% CarPlay, the latest entrants into the infotainment space. But that’s ok with QNX, because more demand for smartphone integration of any flavor just means more business for the middleware provider.
“It’s really the younger generation that is interested in this technology,” says Derek Kuhn, Vice President for BlackBerry Technology Solutions, “and that drives more requirements for QNX.”
Large LCD display screens used to be the stuff of luxury vehicles, but younger demographics are expecting these features in their entry level and mid-market vehicles. This means that more vehicles will need QNX’s CAR platform so that millennials can pair their smartphones in their Kia Souls.
The infotainment market is expanding, and old-school navigation operating system suppliers such as Microsoft MSFT -3.77% Windows Automotive and micro-Itron are in decline. Things are looking pretty good for this division of BlackBerry. Strategy Analytics analyst Roger Lanctot says QNX has unimpeded growth potential in short five- to 10-year term. But there is one company that could give QNX a run for its money: Google
Apple and Google are QNX partners, and integrate with the CAR platform to mirror the smartphone screen on a vehicle’s in-dash display. However, Google is also shilling its own Android–based operating system (not to be confused with Android Auto app) to car makers to power the infotainment system. Honda is one of the early adopters of the Android–based OS, and is using it in several trims of its high volume production vehicles, including Accord, CR-V, and Pilot. The Japanese manufacturer declined to comment on why it chose Android over QNX or any other supplier when it replaced Windows in those vehicles, but Lanctot says there is one advantage Android offers: a robust developer community.
To get apps like Pandora and NPR to integrate with the steering wheel controls or in-dash display screen, most auto makers require you to pair your phone. However, an Android operating system would make it easier to bring these apps into the infotainment system without a device. The ubiquity of Android could also mean more incentive for developers to create apps tailored for the car. But that advantage also comes with a price: more developers are interested in hacking Android than QNX. With a mission critical operating environment, auto makers may not be keen to take chances on a platform with a target on its back. There is also a question of stability.
“Android is perpetually in beta, whereas QNX actually works,” says Lancot.
But even if it loses infotainment marketshare, QNX is expanding outside the center stack. Audi worked with QNX to create a fully digital instrument cluster. Instead of fixed analog gauges, the 2016 Audi TT and R8 feature single screen that integrates vehicle telemetry, audio and infotainment, and navigation using high resolution Google Earth graphics, and that same virtual cockpit will be rolled out across the higher end models of the luxury brand over time. And that’s just the start for QNX.
“Anything that requires advanced computing power is fair target for QNX,” says Kuhn.
As more systems become computerized, security plays a bigger concern. QNX has the advantage of leveraging the technology of BlackBerry subsidiaries, such as Certicom’s elliptical curve cryptography and the BlackBerry Internet of Things platform. Using these vast libraries of patents and technologies, QNX has developed a framework that enables secure over-the-air updates for its infotainment systems to future-proof its products, and non-QNX components as well.
These capabilities are helping QNX to win more business in the advanced driver assistance systems, which are the stepping stones to autonomous cars. Through many of its military and medical customers, Kuhn says it is already powering robots that can walk, swim, drive, and fly without a human on board, which makes them a trusted and vetted partner for autonomous and piloted drive vehicles.
But Google, and to some degree Apple, are contenders in this autonomous car race. Manufacturers may turn to the Silicon Valley giants to license their autonomous drive operating systems for some business models, such as vehicle sharing or last-mile transportation solutions where cost, utility, and market innovation is more of a concern than branding. Low-speed neighborhood electric vehicles would be an easy entrée into the market since they don’t have to comply with many federal safety regulations or crash testing.
That still leaves large swaths of the vehicle market open to QNX, especially in the near future where piloted drive will be a lot more common and accessible than fully autonomous cars. The company is fairly guarded as to where they are headed next, but it plans to reveal a concept car at the 2016 Consumer Electronics Show that centers around ADAS and autonomous drive. On which vehicle or what part of the car they will appear isn’t clear, but one thing is certain—QNX shouldn’t take their eyes off of Google as a competitor.
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