A connected car is a car that is equipped with Internet access, and usually also with a wireless local area network. This allows the car to share internet access with other devices both inside as well as outside the vehicle. Often, the car is also outfitted with special technologies that tap into the internet or wireless LAN and provide additional benefits to the driver. Examples include: automatic notification of crashes, notification of speeding and safety alerts. Concierge features provided by automakers or apps alert the driver of the time to leave to arrive on time from a calendar and send text message alerts to friends or business associates to alert them of arrival times such as BMW Connected NA that also helps find parking or gas stations.
Typically, a connected car made after 2010 has a head-unit, in car entertainment unit, in-dash system with a screen from which the operations of the connections can be seen or managed by the driver. Types of functions that can be made include music/audio playing, smartphone apps, navigation, roadside assistance, voice commands, contextual help/offers, parking apps, engine controls and car diagnosis.
The Los Angeles Auto Show launched the Connected Car Expo on November 19–21, 2013 serving as an open forum, providing attendees with access to the key players, influencers and top media constructing the future of the connected car, to address the issues companies are facing in this evolving market.
On January 6, 2014, Google announced the formation of the Open Automotive Alliance (OAA) a global alliance of technology and auto industry leaders committed to bringing the Android platform to cars starting in 2014. The OAA includes Audi, GM, Google, Honda, Hyundai and Nvidia.
On March 3, 2014, Apple announced a new system to connect iPhone 5/5c/5S to car infotainment units using iOS 7 to cars via a Lightning connector, called CarPlay.
Android Auto was announced on June 25, 2014 to provide a way for Android smartphones to connect to car infotainment systems.
Increasingly, Connected Cars (and especially electric cars) are taking advantage of the rise of smartphones, and apps are available to interact with the car from any distance. Users can unlock their cars, check the status of batteries on electric cars, find the location of the car, or remotely activate the climate control system.
Despite various market drivers there are also barriers that have prevented the ultimate breakthrough of the connected car in the past few years. One of these is the fact that customers are reluctant to pay the extra costs associated with embedded connectivity and instead use their smartphones as solution for their in-car connectivity needs. Because this barrier is likely to continue, at least in the short-term, car manufacturers are turning to smartphone integration in an effort to satisfy consumer demand for connectivity. 
The necessary hardware can be divided into built-in or brought-in connection systems. The built-in telematics boxes most commonly have a proprietary internet connection via a GSM module and are integrated in the car IT system. Although most connected cars in the United States use the GSM operator AT&T with a GSM SIM such as the case with Volvo, some cars such as the Hyundai Blue Link system utilizes Verizon Wireless Enterprise, a non-GSM CDMA operator.
Most brought-in devices are plugged in the OBD (On-board diagnostics) port for electrification and access to vehicle data and can further be divided into two types of connection:
- Hardware relies on customers smartphone for the internet connection or
- Hardware establishes proprietary internet connection via GSM module.
All forms of hardware have typical use cases as drivers. The built-in solutions were mostly driven by safety regulations in Europe for an automated Emergency Call (abbr. eCall). The brought-in devices usually focus on one customer segment and one specific use case.
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