Bluetooth is the prevailing technology for in-vehicle wireless networking and is likely to remain so for the foreseeable future. Market researcher iSuppli estimates that 55% of model year 2008 vehicles for sale in North America offer Bluetooth as an optional or standard feature. That's up from 39% in MY2007, and the technology is likely to grow by another 15% in MY2009.

“We're seeing a fairly dramatic increase in terms of availability,” said Phil Magney, who heads iSuppli's automotive research practice. “Bluetooth is coming down-market rapidly. Middle to high-end vehicles are already onboard, and so are many entry-level models. Virtually all new vehicles will have Bluetooth going forward, and refreshed vehicles will also include Bluetooth.”

According to the Bluetooth Special Interest Group (SIG), nearly every automaker offers at least one model that is Bluetooth enabled. IMS Research reports that 15% of cars now include OEM Bluetooth kits. The firm predicts that by 2012, about one-third of all light vehicles sold will contain Bluetooth technology.

Bluetooth chip developer CSR “has witnessed a big year-on-year growth in demand for wireless connectivity in the automotive industry,” according to Rafik Jallad, the firm's automotive business manager. “Globally there has been an increasing demand for factory-fitted and aftermarket hands-free car kits (Figure 1) as the number of in-car devices grows. Bluetooth is becoming a must-have feature not only in high-end vehicles but also in smaller cars as legislation is put in place to reduce cell phones being a distraction while driving.”

“With more countries and states banning cell phone usage while driving, the correlation on sales for Bluetooth hands-free devices is positive,” noted IMS market analyst Filomena Berardi. She added, however, that other Bluetooth applications like audio streaming, video streaming, and wireless sensors, will not have the same benefit.

The Bluetooth audio streaming (A2DP) automotive market is still relatively small compared to hands-free calling, according to Berardi, though sales of A2DP-enabled portable music players and handsets will have a positive impact on A2DP penetration rates in automotive applications.

The Bluetooth SIG said July 2008 marked a record qualification for A2DP-enabled products, with more than 180 passing muster.

“At this stage a significant majority of consumers are unfamiliar with the concept of wirelessly streaming music via Bluetooth,” said Berardi, “but this situation will change, and as the number of A2DP-enabled peripheral devices increases so will consumer adoption.

“Fundamentally, Bluetooth offers tremendous benefits to other applications within the car,” Berardi said. “It is a little premature for video streaming and wireless sensors as both would require new specifications — high-speed Bluetooth and Bluetooth low energy — that are incomplete. However, there is a lot of excitement in the automotive industry regarding the concept of Bluetooth low energy sensors, especially in the form of dual-mode head units.”

CSR's Jallad believes there will continue to be a strong demand for Bluetooth within automotive applications as the popularity of wireless connectivity grows (Figure 2), but he added, “Other complementary technologies, such as Wi-Fi and UWB (ultra wideband) will start to make gradual headway into the automotive sector in the next few years. The emergence of these technologies will necessitate better radio coexistence to ensure that the quality of the user experience is consistent.”

“There is not a lot beyond Bluetooth for wireless communication inside vehicles,” noted John Vincent, senior marketing manager for infotainment and telematics at Freescale Semiconductor, “but 4G technologies like WiMAX or Long Term Evolution (LTE) lie ahead for communication from outside when the infrastructure is in place.” Applications for 4G technology may include streaming traffic, weather, and other beneficial data, in addition to backseat web browsing.

“Connectivity to the vehicle is very important,” said Niall Berkery, vice president of telematics business development at Cross Country Automotive Services. “The broader the pipe the more services we can push, and the more that consumers can consume.” He noted that development of 4G technologies such as WiMAX and LTE is under way, but added, “the hot topic among automakers is who will be first to adopt 3G.”