Every hour, a modern car processes about 25 gigabytes of information — the equivalent of about seven full-length high-definition movies — on everything from engine temperature and tire pressure to what’s playing on the radio. For automakers, the question is how to turn that into revenue. An Israeli startup claims to have the answer.
Otonomo, which announced $3m in funding from NTT Docomo Ventures Inc. last week, has spent the past three years figuring out how to collect, package and sell such data to insurers, retailers, city planners and others willing to pay for it. In return, it takes a percentage of sales — similar to how Apple Inc. and Google operate their app stores. More than 2 million cars are already on Otonomo’s platform, a number that it says will reach 5 million by year-end.
"There is one simple rule with marketplaces all across the board — one takes 80 percent and the rest are left with 20," said Ben Volkow, Otonomo’s chief executive officer and co-founder. "The way to become that one is to get as many cars on the platform as fast as possible and become dominant."
Daimler AG said last year that it’s testing the startup’s cloud-based platform, and Otonomo said it’s planning to unveil a commercial pilot agreement with a Japanese auto manufacturer within three months. The Herzliya-based company said 10 automakers and 11 auto-related companies are providing data in pilot programs. Including NTT Docomo Ventures’ investment, Otonomo has raised about $41m in funding. Previous backers include Bessemer Ventures and Dell Technologies Capital.
