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Tuesday, February 25, 2014

Ford to Ditch Microsoft Sync Technology for BlackBerry QNX, Sources Say

As reported by the Seattle TimesFord, struggling with in-car technology flaws, will base the next-generation Sync system on BlackBerry’s QNX and no longer use Microsoft’s Windows, according to people briefed on the matter.
Using QNX will be less expensive than licensing Microsoft technology and will improve the flexibility and speed of the next Sync system, said the sources, who asked not to be identified because the decision hasn’t been made public.
Ford has more than 7 million vehicles on the road with Sync using Microsoft voice-activated software to make mobile-phone calls and play music.
The switch may help Ford, the second-largest U.S. automaker, address customer complaints about malfunctioning technology systems and touch screens, which have hurt it in surveys by J.D. Power & Associates and Consumer Reports.
For BlackBerry, it’s a vote of support for a company that lost 95 percent of its value from mid-2008 to November and saw the collapse of a proposed $4.7 billion buyout.
“This would be a huge infusion of trust and confidence to have BlackBerry and QNX expanding into a Ford,” said Thilo Koslowski, auto analyst for researcher Gartner. “This is really the crown jewel in BlackBerry’s crown and could make the rest of the company shine as well.”
BlackBerry stock rose 6.6 percent Monday while Microsoft stock slipped 0.8 percent.
“We do not discuss details of our work with others or speculate on future products for competitive reasons,” Susannah Wesley, a Ford spokeswoman, wrote in an email. Spokesmen for Redmond-based Microsoft and QNX declined to comment.
Ford has said the quality of its vehicles has been “mixed” each of the past three years and fell short of its plan to improve those results in 2013. CEO Alan Mulally was said to be a candidate to become Microsoft’s chief until early this year.
Improving Sync is crucial for Ford to draw car shoppers who are increasingly looking to be connected at all times.
In-vehicle technology is the top selling point for 39 percent of auto buyers, more than twice the 14 percent who say their first consideration is traditional performance measures such as power and speed, according to a study by the consulting firm Accenture released in December.
Ford and Lincoln ranked Nos. 26 and 27 out of 28 brands in Consumer Reports’ annual auto-reliability survey released in October.
While the Lincoln luxury line matched the industry average in J.D. Power’s Initial Quality study in June, the namesake finished 27th out of 33 brands.
Technology companies are competing to win business from automakers as in-car technology becomes an increasingly important selling point.
Google announced an alliance with General Motors, Honda, Hyundai and chipmaker Nvidia in January to bring the Android operating system to cars. Apple is working with BMW, Mercedes-Benz, Nissan and others to introduce its iOS operating system to cars with devices such as the iPhone.
BlackBerry’s QNX Software Systems can be found in cars made by Volkswagen’s Audi unit and BMW, according to its website. QNX and Microsoft are the main suppliers of automotive operating-system software, according to researcher IHS iSuppli.
The switch would be a significant blow to Microsoft’s automotive-software business because Ford is by far its biggest customer, said Gartner’s Koslowski. Microsoft also has software in Kia Motors, Fiat models, Nissan and BMW models, according to its website.
Getting into the Ford system will expand QNX’s industry-leading position for automotive entertainment operating systems, which Koslowski said he estimates is as high as 70 percent.
QNX has done a better job of integrating compatibility with other operating systems, Koslowski said.
“The industry is realizing it has to do a better job to create a unique experience for its customers,” he said.