Google to Fuel the Expansion of In-Car Mobile Technology

Google and Audi are expected to partner to use Android-powered in-car mobile technology in Audi vehicles.

Jan 2, 2014 at 7:00PM

At the upcoming Consumer Electronics Show in Las Vegas, Google (NASDAQ:GOOGL) and Audi are expected to announce a strategic partnership to implement in-car mobile technology in Audi vehicles.  The in-car entertainment and information system will be powered by Google's Android OS. The pairing of technologies will fuel the expansion of mobile platforms in the auto industry. The partnership will likely escalate efforts by Google's rival Apple (NASDAQ:AAPL) to accelerate similar deals with automakers.

The goal of the Google and Audi partnership is to allow vehicle passengers and drivers to access information and features via systems similar to an Android smartphone. Users will be able to listen to music, navigate to new locations, and use various applications within the in-car technology. The inclusion of the Android OS in Audi vehicles will prove to be an important proof of concept as mobile technology is more commonly incorporated in vehicles.

Google shows tremendous growth: The company reported revenue of $14.9 billion in the third quarter of 2013, which is a 12% increase over revenue reported in the same quarter of 2012. Google also continues to be very profitable and reported a net income of $3.64 billion, or $10.74 earnings per share, in the third quarter of 2013.

Investors should watch for a potential deal between Google and Audi for in-car mobile technology. The inclusion of the Android OS in Audi vehicles will likely be just the tip of the iceberg for Google. Keep an eye out for Google to make deals with other car manufacturers to include the Android OS in new vehicle models. Google's expansion into mobile systems for automobile makers will help grow company revenue and expand profits.

Apple's iOS in the Car
Apple currently offers the "iOS in the Car" technology, which allows the pairing of the iPhone with vehicle dashboards. This technology uses a vehicle's in-car display to interact with iPhone maps, music, and messages. The driver can also use the new Siri Eyes Free technology to control the iPhone. Apple indicated that the company expects at least 12 car manufacturers to implement the "iOS in the Car" technology in 2014.

Apple continues to show growth: The company reported revenue of $37.5 billion in the fourth quarter of 2013, which is a 4% increase over revenue of $36 billion reported in the fourth quarter of 2012. Apple continues to show that it is very profitable: The company reported a net profit of $7.5 billion or $8.26 earnings per share in the fourth quarter of 2013.

Apple reported a strong finish to 2013 with excellent sales in iPhones, iPads, and Macs. The company reported that in the fourth quarter of 2013 the company sold 33.8 million iPhones. Apple expects strong sales next quarter with the release of several new products including the new Mac Pro, OS X Mavericks, iOS 7, iPhone 5c, and iPhone 5s.

Investors should keep tabs on which auto companies decide to implement Apple's "iOS in the Car" technology. The adoption of this technology will likely spur iPhone sales as new car purchasers will want to take advantage of the iOS in-car features. The inclusion of Apple's technology into popular vehicle models could improve brand awareness and solidify Apple's position as a leader of in-car technology. The adoption of iOS by car manufacturers will help Apple expand its market and grow company revenue.

Nvidia's piece of the pie
Recent reports have indicated that Nvidia (NASDAQ:NVDA) will play an important role as the supplier for processors in the Google and Audi partnership. Nvidia currently supplies mobile processors for many of the popular Android devices. The deal should be beneficial for Nvidia and allow the company to increase processor sales.

Nvidia reported revenue of $1.054 billion in the third quarter of 2014, which is down 12.5% from revenue reported in the same quarter 2013. Nvidia reported a net income of $153.8 million or $0.26 earnings per share in the third quarter of 2014. The company explained that it is focused on growing PC and mobile specialty markets as well as advancing the GPU market. The strong sales of Quadro, Tesla, and Tegra 4 technologies are helping offset a decline in sales for mainstream PC units.

Investors should watch for a deal between Google and Audi that would involve the use of Nvidia processors. Nvidia investors should look for other potential Google partnerships with automakers interested in using the Android OS. The proliferation of Android vehicle-based systems will help increase the sales of Nvidia processors and grow company profits.

The bottom line
As in-car mobile technology becomes more commonplace in the industry, consumers will likely come to expect mobile integration in new cars. This opens up a new market for Google's Android and Apple's iOS. The industry seems to be leaning toward one exclusive mobile OS per vehicle model. As more vehicles incorporate mobile technologies, the vehicle make and model may heavily persuade the mobile device that the consumer chooses to use.

Make 2014 the year of growth for your portfolio
They said it couldn't be done. But David Gardner has proved them wrong time, and time, and time again with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen 6 picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.

Ryan Sullivan has no position in any stocks mentioned. The Motley Fool recommends Apple, Google, and Nvidia. The Motley Fool owns shares of Apple and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.


Compare Brokers