The telematics industry in India is engaged in an interesting discussion of what is the operational tracking units and hence the sustained revenue which is being generated from it. To an extent those who are raising this issue maybe correct that within short passage of time, the operational units become quite less than the numbers which are in the contract and installed. But does it give all the reason to hold a pessimistic view for an extremely promising industry?
We have seen policy push coming from government for the vehicle tracking services. It has been made an integral part of larger project like waste management system across the country. The state police departments have been mandated with the implementation the tracking of patrol vehicles for better service through Dial 100 in Integrated Mission Mode Project under the NeGP. In PDS and Civil Supplies, the judiciary has intervened to ensure that efficiency and transparency is brought into this system through the use of better processes and tools like vehicle tracking. It may not really convert into the functional numbers overnight. But surely the push from the government highlights the applicability and usefulness of vehicle tracking system, and that it has passed the grilling eyes of consultants who write the DPRs and bureaucrats who mean business.
In the industry front, many of the leading logistics and supply chain companies have implemented the basic VTS for ensuring the safety and online status report. The logistics and transportation industry has many challenges which lead to the high cost of freight movement, like: octroi, stoppages & check points, road, port and warehouse infrastructure etc. Even if vehicle telematics is able to marginally reduce the cost of freight movement through driver behaviour monitoring, better vehicle maintenance or regulating the stops and routes taken, it should recover a part of the initial investment made into this system. According to Deloitte, the market size of Indian logistics sector is around USD 90-125 billion, which according to them may be an under-estimate considering the Indian economy which is over USD 1.73 trillion. If we have the retail FDI come through, it will further add to the growth and perhaps hasten the consolidation of the fragmented logistics industry. The impact should percolate to the vehicle telematics industry.
It’s time the telematics industry service providers move the battle ground from hardware to software application and help explore the ways in which it can help the enterprises increase their operational efficiency. The horizon for application software is vast and we have all the necessary skill sets here to provide the services. Vanilla tracking, with data used for providing customers an online report of where his goods are and use this device to track the vehicle in case its stolen has fulfilled its purpose and helped us cross the desired milestone, the 1st stage of Nolan’s Growth Model i.e Initiation and we now need to prepare for ‘Contagion’. It’s time to move on
Editor & CEO