Travel Agents: Digital Solutions On The Go

Back in 1999, Ed Lasher, CEO of Miami-based YachtComputing, tried to convince a charter boat owner he needed a computer network installed on the boat he was having built. The owner declined, then ended up losing a $450,000 client because the craft didn't have a network with Internet access onboard. Fast forward seven years. That same client is building a new boat and, lo and behold, one of the first things he did was call Lasher to design and integrate a computer network for it. How things have changed.

Just a few short years ago, networked computers were relegated to the business world. But today, YachtComputing's customers are all looking for IP-based networks that integrate Internet and e-mail access with their on-board navigation, security, monitoring and entertainment systems. A yacht captain these days expects to be able to plot a course, check a realtime weather report, read e-mail and surf the Web, all at broadband speeds and from anywhere on the boat. "It's evolved from boat owners thinking there is no need for a computer system onboard to being an absolutely essential component for a yacht," Lasher says. "And the primary mode of communication while at sea has gone from voice and fax over satellite to e-mail."

As people demand full connectivity not only at home but everywhere they go, they also want total access while they're en route. That means more computer and entertainment systems will soon be accompanying us on our travels, no matter what our preferred mode of transportation. A recent survey by J.D. Power and Associates found that about 28 percent of all car owners and about half of SUV and minivan owners said they wanted entertainment systems in their next vehicles.

"If you ask people, 'Do you need a computer in your car?' most people will say 'No,'" says Jack Cali, CEO and co-founder of DriveSoft.net, which sells an in-car mobile multimedia unit through dealers. "But if you ask them, 'Would you like a high-end multimedia system with computing functions like Internet access and e-mail?' they say 'Sure.'"

In other words, industry experts say, the successful sale of new networking solutions targeted at consumers is based on lifestyle needs, not technology. Those solutions, they add, must be customized to fit an end user's needs. To Anthony Kern, U.S. deputy managing partner, Deloitte & Touche, which advises corporate customers on mobile computing technologies, the extended network is the realization of years of predictions. "The entire convergence phenomenon that we've been talking about for the past 15 years is right on top of us now, and it's driving the demand for computers in boats, planes and cars," he says.

For YachtComputing, that demand means plenty of lucrative network design and installation work, systems integration and even application hosting. A typical install on the 150-foot-plus yachts Lasher services runs about $130,000, plus $1,500 to $3,500 a month for unlimited Internet access, depending on the bandwidth needed. YachtComputing also operates a Miami-based data center providing Web and e-mail hosting for about 50 clients. "As on land, boat technologies are converting to Ethernet and TCP/IP for the backbone connectivity between all their onboard devices," Lasher says. "On our side, the art is to knit all this together so it's seamless to the user."

There is no better indication of the growing interest in bringing computing power to cars and boats than the recent joint venture between software giant Microsoft and KVH, a Middletown, R.I.-based manufacturer of mobile communication systems. The two announced a partnership in January to offer an appliance that enables satellite TV and broadband Internet access in boats, cars and RVs. The appliance, KVH's Mobile Internet Receiver with MSN TV service, also includes four Ethernet ports and Wi-Fi output to provide Internet connectivity to a wide range of Wi-Fi-enabled products. "It's a natural extension for us," says Jim Dodez, KVH's vice president of marketing. "The collaboration with Microsoft is ideal because now we can deliver a wide range of Internet capability to people at an affordable price."

Pricing for the system is still being worked out, Dodez says, but the unit should retail for less than $1,000 for cars and about $1,250 for RVs and $1,500 for boats, both of which require an EVDO antenna for broadband cellular service. Once installed, the combined MSN TV and EVDO cellular service for unlimited Web and e-mail access will be less than $100 a month, Dodez says, adding that KVH currently has 70 percent share of the market for bringing satellite television to the screens already installed in cars, boats and planes.

Using market research from J.D. Power & Associates, Telematics Research Group and Frost & Sullivan, KVH estimates there are about 170,00 boats in the United States more than 30 feet long with color televisions, about 400,000 Class A RVs with color televisions and about 5 million cars equipped with mobile video screens. "Our deal with Microsoft gives us the exclusive right to provide the MSN TV service to all those screens," Dodez says. "We see them as the prime platform for our products."

On the boat side, KVH has identified two groups of customers: families with cruising boats that want an entertainment system available onboard after a day on the water and business executives who need to stay connected while offshore. On the land vehicle side, KVH is targeting an older, retired crowd that wants to stay in touch with family and friends via the Web and e-mail while traveling around the country, as well as families with children who want access to video games and rear-seat entertainment systems in their cars, minivans and SUVs.

These customers tend to have very high expectations for their systems, Dodez says, which makes after-sale support crucial. The systems will be installed, serviced and supported by a mix of dealers and vertical market specialists. "We rely on our network of value-added dealers," Dodez says. "The experience in the channel is very important to providing the support our customers expect."

Marine computer systems, especially, require boatloads of technical engineering and specialized approaches. These can be quite different from home networking, says Rufus Van Gruisen, president of Cay Electronics, Newport, R.I. Cay Electronics is a four-year CEDIA member specializing in navigation, communication, A/V and computer systems in recreational crafts from 20 to 300 feet long.

One of the main challenges in networking boats is that spaces are tight, and densely packed cabling requires the integrator to guard against interference. In marine networking, integrators also must deal with vibration and salt air. "The environment is a lot harsher on the equipment," Van Gruisen says, and the power supply to systems is not as "clean." Systems must be able to switch from dock power to onboard generator power and have to juggle multiple communications systems, he says, including Wi-Fi, GPRS (General Packet Radio Service) and satellite, depending on whether a boat is in a marina, cruising along the coast or farther out at sea.

More digital integrators, however, will most likely face the obstacles of space and vibration when building in-car systems, since that's where the growth in mobile systems is really gaining speed. Market researcher Frost & Sullivan predicts the revenue for in-vehicle computing and entertainment systems will jump to $4.4 billion in 2011, up from $2 billion in 2004. Falling prices and new products that enable and complement satellite TV and radio, as well as MP3 playback units and rear-seat entertainment systems, will spur the market, says Sandeep Kar, Frost & Sullivan industry analyst in the automotive and transportation group. "Consumers are used to digital entertainment in the homes," Kar says. "Now, they want to transfer that experience into their vehicles."

Digital entertainment systems tend to be in the more roomy SUVs and minivans, he says, but compact cars and sedans soon will be getting screens installed in headrests, opening up the market for more rear-seat entertainment systems. Another area poised for growth is the satellite TV market. "Once the price point reaches $1,000, we expect there to be a lot of consumer interest," Kar says. The market will "explode," Kar adds, when the prices hit the $500 to $600 range.

Damien Stolarz has been waiting for that explosion to detonate for a while now. Stolarz literally wrote the book on in-car computing, "Car PC Hacks," and created the CarBot system in 2003. He is now CTO of StreetDeck, owner of MP3car, which designs and manufactures in-vehicle computing products like the StreetDeck Trunk Mount Hardware Bundle, which includes an MP3 player and DVD player and retails for $1,699. "The market is finally waking up," Stolarz says. Up until now, he says, there have been three distinct market segments for in-car computers: "gadget head" car customizers, business executives who want to integrate a car system with their office system and demand everything to look "factory," and the affluent third- or fourth-car buyer who wants all the "insane stuff" in a tricked-out SUV.

Like the rest of the digital integration market, Stolarz says systems will go more mainstream when prices come down and when installation becomes easier. In 2003, when Stolarz surveyed his CarBot installers, they requested a $400 unit with a half-hour install time. Installation now takes anywhere from three to six hours, he says. "We're expecting to see the market really open up once we get the price down below $1,000 and once we get the install time down."

MiniPC vendors and distributors are looking to encourage--and gain from--the opening up of the car and boat computer markets. They hope to move beyond the narrow areas of car stereo installers and marine electronics firms to a wider universe of digital integrators and solution providers. And these companies are not just waiting around for the explosion to occur; they're offering systems to the channel to make it happen.

At the Intel Developer Forum last month, AOpen America, San Jose, Calif., unveiled to channel partners its newest miniPC, the MP945-VX, which integrates Intel's Core Duo processor and Viiv platform with AOpen's MoDT (Mobile on Desktop) technology. The unit has an MSRP of $899, and $699 for Core Solo. "As the wireless infrastructure build-out occurs with technologies like Wi-Max and GPRS, this enables more full-function PC systems in vehicles, and so increases the integration opportunities for channel partners," says Chris Liu, AOpen's vice president of product marketing.

Logic Supply, a Waterbury, Vt.-based specialty mini-ITX distributor, also is looking to digital integrators and solution providers to drive sales of its products. The company's most popular in-car system, the VoomPC mini-ITX, includes a 40-Gbyte Samsung hard drive, Windows XP Professional OS and 7-inch Xenarc touch-screen display and sells for about $1,000. Overall, about 80 percent of Logic Supply's revenue comes from integrators and solution providers, says Andrew Swayzee, director of business development. In the car market, about 60 percent of sales are generated by integrators and solution providers. "Solution providers add value and expand the market for our products by knowing both cars and computers."

LANHeadz Computing, a network integrator in Nokomis, Fla., is working to do just that--expand the in-car computing market beyond the world of hobbyists, where it got its start. President John Wishon had 10 years of experience in the auto industry as a dealer general manager before founding LANHeadz in 2002. The integrator buys PCs from Logic Supply and parts and accessories from MP3Car to build in-vehicle PC solutions for small-business customers in the real estate and other industries. LANHeadz recently built two systems for a self-styled "mobile DJ" who wanted his entire music library in his vehicle. Says Wishon, "We're out to provide mobile PC solutions for people who don't have the expertise to do it themselves."

There is no better evidence of the growing interest in bringing computing power to cars and boats than the recent joint venture between software giant Microsoft and marine electronics firm KVH. The two companies are working to offer an appliance that enables satellite TV and broadband Internet access in boats, cars and RVs. KVH's Mobile Internet Receiver with MSN TV service also includes four Ethernet ports and includes Wi-Fi output to provide Internet connectivity to a wide range of Wi-Fi-enabled products.