I vividly remember when we were deciding to spin-off from Microsoft. Despite the chaos and pressure of walking away from a job I loved to start something ‘new’, I was invigorated by the potential to completely disrupt the transportation industry. Instead of getting traffic information from helicopters, which was the norm at the time, we were going to use GPS signals and Big Data to create global traffic information and help people navigate congestion.
Throughout our 15-year history, INRIX has been at the forefront of the mobility revolution having witnessed some of the industry’s brightest innovations and boldest transformations.
In 2005, buzzwords such as connected cars, over-the-air updates, and Big Data were just ideas. Smart phones and the Internet of things (IoT) didn’t really exist, Twitter hadn’t been introduced, and YouTube and Facebook had just launched.
But it was in that year we pioneered the game-changing approach to leverage GPS to create global traffic data. Despite being mocked, ridiculed and written off by the industry for years, we succeeded in fundamentally changing the way traffic data was collected and dispersed, globally. We accomplished this by processing massive amounts of real-time data in an era when there was no AWS, cloud computing or predictive analytics. To put in perspective, the 800-pound gorilla in the traffic industry was Westwood One who was flying helicopters, and they don’t even exist anymore!
We succeeded because we were able to predict 5-10 years ahead and understand how the market would evolve while simultaneously identifying what our customers would need – usually before they even knew it themselves.
This approach led us to transform our business from ideation to realization – from a niche traffic data supplier to a leading provider of connected car services and transportation analytics with hundreds of customers and services in nearly 150 countries today. We then transformed our business beyond the automotive space to reach the public sector and enterprise industries as well.
Yet all of these years later, INRIX needs to transform again – and use SaaS as our north star to continue to grow and evolve to meet the market for the next decade.
Why the transition?
It’s no secret that the world around us is changing. Technological advances in IoT, AI and automation have created the largest shift in consumer behavior we’ve ever seen – from the way people and goods get from point A to point B, to the way we consume information, and the way people order products and services. Convenience is at the very heart of it, and it’s shaking up every industry.
Let’s take the automotive industry for example. Over the last several years, we’ve seen the convergence of the automobile and the information technology industries. CES became the most important car show of the year. This created a plethora of new entrants in an industry that’s traditionally been dominated by conventional automakers and suppliers for over 100 years. Tesla challenged the status quo of the automotive industry’s historic roots with the introduction of the electric drivetrain and OTA software updates. Then came Google Automotive Services (GAS), an ecosystem that embeds applications such as Google Play Store, Google Maps and Google Assistant directly into dashboards, enabling consumers to access these features directly through their vehicle. Many of the largest automakers (GM, Volvo, Renault) have already announced their move to this platform. Even Apple and Amazon have entered the space with mirroring capabilities. And the list keeps growing.
What exactly does this mean? As vehicles become increasingly sophisticated due to expanding consumer demands, the traditional ecosystem of navigation, mapping and hardware companies is fundamentally threatened. Technology companies like Google, who want to replace the traditional head-unit stack, will take the majority of the automotive in-dash software market, leaving a shrinking business for anyone whose primary business is selling into this market. I have first-hand experience having been the General Manager of Microsoft’s Automotive business when we were trying to do just this.
A good friend of mine who was a very successful entrepreneur and venture capitalist once said, “Innovation is like surfing – if you hit the wave too soon, you get crushed by the wave because you’re in front of it. If you hit the wave too late, you can paddle as hard as you want but you’ll never catch up. But if you hit the wave just right – it’s a sweet ride.” And he’s right. Microsoft was too early and gave up; Google has hit the wave just right.
But it doesn’t stop with the automotive industry. The impact of technology and Big Data is being felt across all sectors, and for good reason. It’s the backbone of every successful organization and without it, roads, cities and businesses would grind to a halt. It holds the keys to massive benefits – from monetization to agile decision making to data-driven marketing.
For INRIX, this means we must transition away from our existing Data-as-a-Service (DaaS) products and double down on our Software-as-a-Service (SaaS) offerings, especially within public sector and enterprise markets. There are many benefits to making our services available through SaaS, most of which boil down to helping our customers get powerful insights anywhere, anytime as easily as possible.
The world was changing long before 2020, but the pandemic has impacted nearly every industry across the globe, disrupted global supply chains and forced companies to rethink their traditional ways of doing business entirely. Think about it: closing a deal no longer means meeting face-to-face; designing a new feature no longer requires a conference room and a whiteboard. While there’s no way we could have predicted a global health crisis, we’re fortunate to have already been preparing for the transformation of our company.
In fact, we’ve been laying the SaaS groundwork for several years now. INRIX Road Rules, INRIX Roadway Analytics and INRIX Trip Trends have been providing incredible insights to hundreds of customers worldwide – all of which are now part of our unified SaaS application suite, INRIX IQ. Even more valuable in today’s post-COVID world, INRIX IQ makes it easy for anyone to uncover insights from location-based data. As organizations shift to remote operations, face budget cuts and tackle extreme uncertainty, INRIX IQ provides a safer, smarter, faster and more affordable alternative to traditional methods of data collection, management and analysis.
Proof (and revenue) is in the data
While our automotive products currently account for a third of our business (down from 66% just 5 years ago), our SaaS portfolio of tools have seen a ~30% CAGR over the same period. In fact, our SaaS offerings now account for about a third of our total company revenue and have been dramatically increasing.
The first product launched under our SaaS model – Roadway Analytics – provides near real-time insights into what is happening on roads, benchmarks and measures roadway performance, and maximizes the investment of public funds. In just four years since its inception, hundreds of local, state and federal organizations across the globe have leveraged this platform to monitor, measure and manage their roadways.
In 2018, we launched Road Rules – the first SaaS application that lays the foundation for connected mobility by helping cities digitize, manage and communicate the rules of the roadways, curbs and sidewalks. To date, more than 40 cities and six operators are using Road Rules to ensure safe and efficient mobility.
Realizing the significant impact COVID-19 would have on our roadways, we launched Trip Trends, which provides powerful insights on passenger, heavy freight and local fleet travel trends in the U.S. and Europe.
As a company, we are committed to improving mobility worldwide by connecting people, vehicles, cities and businesses. That is our mission. INRIX IQ plays a critical role in this goal, making insights from trillions of complex data points more accessible and easier to understand.
In the coming weeks and months, we plan to add exciting new features to INRIX IQ and launch new applications that will help our customers do more with our data and make them more productive. The transportation industry is on the cusp of moving from manual and physical data collection methods that have historically been required to make informed decisions to the sorts of no-hardware-required data solutions that INRIX can provide access to.
The launch of INRIX IQ, with its trial and self-serve capabilities, will allow us to serve market segments that we previously didn’t address through our traditional outbound sales model. We are betting that we can streamline customer acquisition and deliver growing value to a broader audience. This strategy doesn’t replace our current business model, but rather augments what we do with our large strategic customers, and broadens the overall addressable market for us at INRIX.
For years, we’ve helped the world’s most innovative automakers, transportation agencies and businesses take advantage of location-based intelligence. Now we’re building on that commitment to make these insights more accessible and easier to comprehend for everyone – from interns to traffic engineers to CEOs.
This is arguably one of the most challenging, yet rewarding, times to be part of the transportation revolution. And 15 years later, I’m excited we’re still in the driver’s seat to help drive this transformation.
Note: The following is taken from a keynote I gave at CTS/CES this week on the connected car.
A lot of people talk about the connected car, but at INRIX we have a fairly unique perspective since we collect real-time information from more than 185 million vehicles and devices every day. With this perspective, we believe we’re approaching a new world, looking at all the sensors that exist in a car and asking what we can do for societal benefit. We started INRIX with a singular question, “Can we reduce traffic congestion?” The answer was ‘Yes’. But through that process, we see a myriad of other opportunities to transform data from vehicles into useful insight for both drivers and cities. Can we improve safety through road weather condition reports? Yes. Can we help people find parking? Yes. Are there dozens of other applications we can develop to benefit society? Yes. But we approach this new world with 5 key tenants which I think are important for all OEMs and people in this industry to adhere to.
The first tenant is the services in the car have to be intelligent. Today vehicles and the HMI of vehicles are over burdened by the user having to click a dozen times or more to get the information they’re looking for. The information has to be relevant, personalized and intelligent meaning don’t make me click multiple times to figure out where the cheapest gas stations are. Instead, detect where my fuel status is and alert me and give me the information because you’ve learned where my home and where my work is so you can alert me along the road that I need gas and where’s the cheapest location for me to stop along the away. Learn from the vehicle itself about the users’ behavior and be intelligent. Rather than the user pulling the information, anticipate drivers’ needs and automatically push it to them.
The second tenant is vehicle integration. This is key and what is missed a lot in terms of the whole Google and Apple discussion. People are worried about Google and Apple and what’s going to happen in the car, but the key for OEMs is vehicle integration. Most of these scenarios about road weather, parking and fuel information all require vehicle-based data. OEMs can use that data to increase the value in their cars. Google and Apple are out demanding the information for different purposes. They’re demanding it because they want to improve their own autonomous vehicles and who knows whether Google will compete or not in terms of building their own cars. They’re also using the data to advertise and target the user. Their goal is to own the user data regardless of the safety risks or consumer desire to receive targeted advertising while they’re driving.
The third tenant is around community. They key of community are the network effects. When you have millions of millions of people and in a given city that can provide this data, the quality and value of the data gets better. The more vehicles you have that can give you specific information, the more valuable the service can be. This is why multiple OEM’s participating in a driver network is so important – the data continually gets better with each vehicle shipped.
The fourth tenant is integration with the mobile phone. People already have calendars and contacts on their mobile phone and the OEM won’t be able to replicate that. But by integrating with the information consumers already have on their mobile phones, you can now do very interesting things. I want my car to be able to say “Bryan you’re going to be 15 minutes late to work today, I can see Jon and Scott are in your first meeting. Do you want me to alert them that you’re going to be late?” People have talked about this scenario for years, but I think these type of highly personalized experiences are something you will see roll out in the next year. In the future, this type of experience will go even further and notify your alarm clock that it needs to wake you up 30 minutes earlier that day in an effort to help you arrive on time regardless of the delay.
The fifth and final tenant is simplicity. Everything has to be simple – people don’t like complexity. This industry has been bad in terms of designing easy HMIs. These HMIs have to be very easy, personal and relevant to the drivers themselves. Most importantly, these services have to be OEM centric and be centered around the driver and the in-vehicle experience as opposed to centered around the needs of a vendor such as Google or Apple who have other objectives in mind.
Overall, we are at a real inflection point in the industry and we at INRIX are excited to be a part of helping make vehicles truly intelligent moving forward.
Proud to say INRIX has entered a strategic partnership with Samsung focused on levering mobile technology to connect cars for smarter cities. Debuting on Samsung’s new lineup of mobile devices just in time for the holidays, INRIX real-time traffic and travel time insight powers several new apps and services designed to help drivers save time, fuel and avoid frustration every day including:
“Car Mode.” Consumers can set their device to automatically switch to a driver friendly user interface that uses voice controls and larger, crisper fonts and button sizes to make it easier to get traffic information, make calls, listen to messages and play music on the road. Car mode provides real-time traffic maps showing the best routes, travel times and ETAs to home and work in traffic. Continuously monitoring conditions on the driver’s route throughout their journey, car mode also provides voice alerts to drivers about accidents and other incidents in enough time to avoid delays as well as access to real-time insight into the closest available off-street parking and least expensive place to refuel.
“My Places” Widget. Samsung’s new My Places widget provides Galaxy Note 4 and Note Edge owners with ‘glance and go’ insight into the best route, travel time and ETA from their current location to home and to work.
Samsung Gear S Smartwatch and INRIX XD Traffic app integration.INRIX XD Traffic app users now can receive departure alerts for saved places in the app that tells them the best time to leave and expected travel time in traffic to their destination.
“Morning!” Smart Alarm Clock App.Morning! Smart Alarm Clock is a smart alarm app that gets you up and going with weather, traffic conditions to work, your appointments of the day, and unread emails – all to help you get your day started right. INRIX helps this app jump start commuters’ day each morning with insight into recommended departure times and travel times in traffic to work and alerts to accidents and other incidents causing delays on their route.
Today INRIX completed a study with the Center for Economics and Business Research (Cebr) projecting the combined annual cost of traffic gridlock in Europe and the US will soar to $293 billion by 2030 if nothing significant is done to address it. This is almost a 50% increase from 2013, driven mainly by urban population growth and higher living standards as a result of increased GPD per capital.
What can be done? The key is to make data-driven decisions. Drivers make better decisions about when to drive and where to drive if they have real-time information available to them. Too often governments make decisions based on politics and not data about what will have the biggest impact on reducing congestion.
Better data = better decisions = reduced congestion. At INRIX, we’re trying to do our part to provide this.
Yes, I know everyone else has been blogging forever, but given my day job (running a company), I just haven’t found the time or the need. However, in my position at CEO of INRIX I’m watching first-hand how the automotive and transportation industries are changing.
I used to live in Detroit and work at the Ford Motor Company. I loved cars, but for about 100 years, the car fundamentally hasn’t changed – body styles changed and new features were added (e.g., power steering, power seats) but nothing truly revolutionary.
Between the electric vehicle, autonomous driving, connected car services, vehicle-t0-vehicle communication, ride-sharing services and many more innovations, the automotive industry and transportation in general is *fundamentally* changing – it will look completely different in 10-20 years than it does today. 100 years and no big changes…the next 10 will change everything.
That’s exciting! And also why I’m now blogging…to share my thoughts to whomever is interested.
I'm Bryan Mistele, the founder & CEO of INRIX, a leading provider of traffic information, connected car services and transportation analytics. I’m a Microsoft, HBS and UofM alum. I'm a husband of one lovely wife, father of two great kids, and manager of one very time-consuming company. I'm passionate about boating, politics and Christianity.