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Did you know an average American spends 17600 minutes behind the wheel each year? That’s a significant chunk of time. With the rise of longer commutes and electric vehicle charging stops, the demand for engaging in-car experiences is constantly rising. In this regard, the automotive industry is taking advantage of advanced technological solutions to enhance user experience. Amongst all alternatives, in-car gaming is likely to be the trend amongst the young generations of tomorrow.

The Rise of In-Car Entertainment

From cassette playlists to in-car command centers, entertainment evolved – first for passengers with cassettes, then for all with CDs, digital music, and infotainment systems.

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Now, the focus is shifting beyond the front seat. The rise of autonomous driving and longer commutes has triggered the development of rear-seat entertainment options. This includes built-in screens, integration with personal devices, and even dedicated entertainment packages for passengers.

In-car Gaming Presents Great Potential for the OEMs

In-car gaming embodies the concept of the “Vehicle as a 3rd Living Space,” extending entertainment options beyond the traditional home and workplace. As per survey by Statista, nearly 33% of all newly registered cars will offer assisted driving by the year 2025. In this regard, in-car gaming offers unique value propositions for OEMs. Here’s how it can benefit OEMs.

Provides Competitive Edge:  In the competitive market, in-car gaming is a unique selling proposition. Imagine test-driving a car where passengers can unwind with a relaxing game – it changes the entire experience.

Improves Passenger Satisfaction: In-car gaming can make long journeys more enjoyable. Happy passengers, on the other hand, can be a positive word-of-mouth promotion.

Opens up Revenue Streams: OEMs can partner with game developers to offer tiered in-car gaming experiences. Freemium models with premium content subscriptions can be a lucrative revenue source.

Improves Brand Image: Being at the forefront of in-car entertainment can help OEMs brand themselves as tech-savvy and innovative. This can attract younger demographics, a key target audience.

Aids in Data Collection:  In-car gaming platforms can generate valuable data on user preferences and in-car behavior. This can be used to personalize future in-car experiences, target advertising effectively and improve customer experience drastically.

These benefits clearly explain how in-car gaming is definitely a strategic move for OEMs to stay ahead of the curve and create a delightful passenger experience.

Big Automotive Players On Beta Testing the Opportunity

The BMW Group has already brought in-car gaming experience for users in its new BMW 5 series. The automobile giant has partnered with gaming platform AirConsole to enable front and rear passengers to engage in casual games when the vehicle is stationary. Players can easily play games without any fancy consoles. All they need is their smartphone as a controller and the BMW Curved Display.

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KPIT, in partnership with N-Dream AG, is all set to revolutionize rear-seat entertainment with in-car gaming. KPIT bridges the gap between gaming companies and automakers, facilitating the creation of customized in-car gaming experiences.

At CES 2023, Sony Honda Mobility unveiled the Afeela, an electric vehicle (EV) prototype with an in-car gaming experience. Afeela has shown a future where in-car entertainment can and will take center stage. Afeela has partnered with Epic Games’ Unreal Engine to offer in-car gaming powered by high-definition graphics. This collaboration highlights how big brands see the potential of in-car gaming and entertainment. That said, there is a huge scope for a more engaging and interactive driving experience for passengers.

Tesla has been working on including Steam integration to add 30,000 games into its vehicles with features like crossplay and resuming the game where you left it on the PC.

Adding to the competition, Berlin company Holoride GmBH (owned by Audi) is offering in-car VR entertainment to its users, where headsets turn real-world input during the transit into immersive VR games.

In-Car Gaming Unlocking Entertainment and Revenue Streams for OEMs

Imagine a future where long journeys are no longer painful but actively enjoyed. Passengers in the backseat are fully immersed in games, while those waiting at charging stations can also have a quick escape into virtual worlds. 

Traditionally, in-car entertainment has long been focused on music and radio with limited options for passengers to have stimulated engagements. However, with the rise of long commutes and the need for frequent charging for EVs, the demand for engaging in in-car experiences has skyrocketed. 

The beauty of in-car gaming lies in its scope for deep personalization. Imagine a system that learns your preferences and curates a gaming library based on your favorite genres, difficulty levels, and even time of day. Children can be introduced to educational games that match their age and learning styles, while adults can enjoy casual puzzle games or even pick up where they left off on a more complex strategy game at home.  This level of personalization improves the travel experience for passengers, and aids in building strong brand image for OEMs. 

However, vehicle safety is also important. Driver distraction is a serious issue, and any in-car entertainment solution must prioritize passenger engagement without compromising safety. This can be achieved through dedicated gaming screens positioned exclusively for rear-seat passengers. Additionally, context-aware gameplay restrictions could also make an ideal solution. That means the system will automatically disable games when the vehicle is in motion or exceeds a certain speed limit.

A Multi-Tiered Revenue Model for In-Car Gaming

How can in-car gaming open up gates for a multi-tiered revenue model and maximize profit potential for OEMs?

Well, here are some key possibilities:

Freemium Model with In-App Purchases:  In-app purchases account for 79% game apps earnings. OEMs can pre-install games with free access to certain basic levels only. It will be just to offer a taste of the gaming experience. Passengers can then choose to purchase additional levels, characters, power-ups, or exclusive content within the game. This will generate revenue for the OEM through in-app purchases powered by secure payment gateways.

Subscription Services: Subscription-based gaming market is expected to reach $55.94 billion by 2031. OEMs can leverage the popularity of subscription models to offer access to a vast library of games. Passengers can access a wider variety of games by paying a monthly or yearly fee and get free from individual purchases. For that, OEMs need to partner with game publishers to curate these libraries to offer a diverse and high-quality selection.

Cloud Gaming Integration: What if passengers are looking for high-end games, but the vehicle lacks the required technological integration? Well, cloud gaming is the solution. Cloud gaming platforms can enable players to have access to high-end games without requiring powerful hardware in the car. Once OEMs integrate these platforms, passengers can enjoy graphic games typically reserved for home consoles in the vehicle. OEMs can roll out such cloud gaming services on a subscription model to generate profits.

In-Game Advertising:  During the initial launch, passengers may not opt for in-game purchases. OEMs can use this opportunity to promote non-intrusive, targeted advertising within games for revenue sources. Imagine advertisements for restaurants or nearby attractions displayed during loading screens or breaks in gameplay. However, striking a balance is crucial. Ads should be subtle and relevant to the passengers’ interests. They should not disrupt the gaming experience.

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Microtransactions for Cosmetic Items: OEMs can offer players the option to purchase cosmetic upgrades for their in-game avatars or vehicles. Cosmetic upgrades bring purely aesthetic changes like character skins or car decals to personalize the game experience. As per the February 2020 survey of MMO players, nearly 30% of respondents spent 26%-50% of their total in-game spending on such cosmetic upgrades. 

Tournaments and Challenges: OEMs can host in-car gaming tournaments or challenges to increase engagement amongst passengers. Players can pay an entry fee to participate in these events. Additionally, sponsorships could be secured to offset investments to open revenue sources through tournaments. 

In-game Virtual Goods with Real-World Benefits: Create a system where players can purchase virtual goods within the game that translate to real-world benefits. Players can earn points in a car trivia game and redeem them for discounts on car washes or maintenance services offered by the car manufacturer. 

Partnership with Streaming Services: Integrate popular streaming services directly into the in-car gaming platform. Passengers could access their existing subscriptions or sign up for new ones directly within the car. This will generate revenue for the OEM through referral partnership. 

End Thoughts 

In-car gaming has the potential to be a major game-changer for OEMs. It can unlock entirely new revenue streams.  However, to fully capitalize on this opportunity, OEMs need to collaborate with game content developers and technology solution providers to ensure a rich and engaging gaming experience for passengers. Additionally, stringent safety compliances must be established and adhered to. Regulatory compliance surrounding data privacy and in-car distractions will also need to be addressed. By working on these considerations strategically, OEMs can position themselves to reap the rewards of in-car gaming.

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Perspectives of KPITians