Software Defined Products

Software Defined Products describe a new type of product that focuses on software rather than hardware and is used to deliver a wide variety of solutions.

The characteristics of Software Defined Products

Software Defined Products can be described in terms of the following characteristics:

Product benefits become programmable: Large parts of a product’s range of functions and benefits can only be accessed digitally and are controlled via apps or digital displays.
Product release = software update: New features are installed and made available as software updates. The customer no longer has to wait for the new device or hardware generation.
Differentiation via software functions and usability: The hardware and material properties of products gradually recede into the background. In the future, a significant part of the product benefit will be derived from software-based functionalities, sensor technology and the networking of devices to form a holistic IoT solution.

Consequently, software development becomes a central aspect of the product life cycle. From prototyping to the production phase, software is the key variable that significantly influences product development.

Potential, complexity and cost

In the heat of the battle around digitalization, analytics and the cloud, it’s easy to overlook the advances currently taking place in infrastructure and operations. Today, the entire operating environment – servers, storage and network – can be virtualized and automated. The data center of the future offers the potential to not only reduce costs, but also dramatically increase speed and reduce the complexity of deploying, implementing and maintaining technologies. “Software Defined Everything” can make infrastructure investments much more cost effective and thus become a competitive advantage.

Challenge to the Mobility Industry – Establishing Holistic Software System Competence

Software-driven change is taking place in all industries. The automotive industry has also been in the midst of structural change for years: connected services have been around for decades, cars already contain up to 100 electronic control units supported by millions of lines of code, and advanced AI algorithms are being developed for autonomous driving. Hardware and software engineering for automotive systems is fundamentally changing to include advanced embedded and cloud technologies, distributed computing, real-time systems, and distributed safety systems.

Automobile manufacturer and software system competence

Nevertheless, most automakers are currently unable to build software-defined dream cars. Some companies have even failed to survive structural change, and it is certainly a mistake to disregard key indicators of potential large-scale upheaval. Particular attention should be paid to players in other industries, such as telecommunications. These often enter the automotive industry market with superior technology. The hardware- and software-intensive systems in modern cars offer many new possibilities, but they also require careful design, implementation, verification and validation before they can be released to users. To manage the rapidly growing complexity, automotive software needs a clear architecture. Of course, the architecture must also meet SW/HW quality, functional safety, and cybersecurity requirements.

Two converging trends

Despite delays caused by the pandemic, players in the automotive industry must focus on the transition to products whose characteristics are determined to a large extent by the software implemented; indeed, they must accelerate this transition now. There are signs that automotive sales will recover. And it stands to reason that the pandemic will foster a customer base that is inclined toward car ownership for safety reasons and is also accustomed to software-based features – two trends that will converge, with car buyers preferring vehicles that incorporate the same software-based options they already rely on at home, work and play. To prepare for this demand, automakers must put software at the center of their operations and products – with the help of a holistic software systems capability. Agile service delivery models combining DevOps, microservices, and cloud solutions will enable functional changes that go far beyond the traditional V-development approach. The software-defined car combines different types of hardware and software architectures, and HW/SW designers and architects will need to be familiar with a range of paradigms and best practices from different hardware and software disciplines.

Big Data Services, Autonomous Driving, Smart City and Smart Grids

A smart city is essentially defined by information and communication technologies (ICT). It is about meeting the growing challenges of urbanization. A large part of this ICT framework is an intelligent network of interconnected objects and machines that transmits data using wireless technology and cloud applications.

Cloud-based IoT applications

Cloud-based IoT applications receive, analyze, and manage data in real time to help municipalities, businesses, and citizens make better decisions that can improve quality of life.

Smart City Ecosystems

Citizens interact with smart city ecosystems in a variety of ways, using smartphones and mobile devices as well as connected cars and homes. Linking devices and data to a city’s physical infrastructure and services can reduce costs and improve sustainability. For example, communities can use the IoT to improve energy distribution, streamline garbage collection, reduce traffic congestion, and improve air quality.

Examples of the automotive sector in a smart city:

Autonomous driving: Locomotion with the aid of vehicles, mobile robots and driverless transport systems that behave largely autonomously.
Smart grids combine generation, storage and consumption. A central control system optimally coordinates them with each other and thus balances out power fluctuations – especially those caused by fluctuating renewable energies – in the grid.
Smart traffic control: Networked traffic lights receive data from sensors and cars and adjust traffic light switching and timing to traffic volumes in real time to reduce congestion on the roads.
Connected cars can communicate with parking meters and electric vehicle (EV) charging stations to direct drivers to the nearest available parking space.
Smart trash cans automatically send data to waste management companies and schedule pickups on demand, rather than on a predetermined schedule.
Smart administration: And citizens’ smartphones become mobile driver’s licenses and ID cards with digital badges, speeding and simplifying access to the city and local government services.

Together, these smart city technologies optimize infrastructure, mobility, public services and utilities. The automotive sector will benefit through comprehensive fleet and vehicle functions.

Software quality (ASPICE), functional safety and cyber security

In telecommunications, cyber security regulations were already introduced in the 1990s and early 2000s, and in the medical sector even earlier. And although the Internet capability of vehicles has also been technically realized for many years and software updates of many vehicles on the market already run over the air (OTA), i.e., wirelessly, the automotive industry has not particularly prioritized cybersecurity over the past 40 years, so that the industry is lagging behind many other sectors today. This is all the more threatening because vehicle functionality today relies on millions of lines of code, and communication buses such as CAN, LIN, and even Ethernet have become popular gateways for hacker attacks.

Cyber security as a critical factor for success

Cyber security has therefore become a critical factor for success and must become part of the company’s overall system function. All cyber security aspects must be considered across the entire value chain. Otherwise, there would be a constant danger of a third party taking control of the car while it is being driven.

The most important regulations at a glance

Since 2020, there are now also mandatory regulations on cyber security and software updates for the automotive industry and its players. For example, a holistic Cyber Security Management System (CSMS) and a Software Update Management System (SUMS) have become compulsory for vehicle manufacturers and their type approvals. We have reported on this several times before. ISO/DIS 24089 and ISO/SAE 21434 also play a role in the world of regulations, as well as ISO/TR 4804:2020 Road vehicles – Security and cyber security for automated driving systems – Design, verification and validation and the TISAX® (Trusted Information Security Assessment Exchange) standard of the VDA. TISAX® focuses on the needs of the automotive industry: a certification for automotive suppliers is intended to ensure information security in the automotive industry. The German Association of the Automotive Industry (VDA) published the Automotive SPICE for Cybersecurity guide last February. Automotive Spice, or ASPICE, stands for Automotive Software Process Improvement and Capability Determination, and is amongst others intended to evaluate the performance of OEMs and their suppliers software development processes in the automotive industry.

All these new regulations now serve as a basis for any company working with OEMs, as well as for the automotive manufacturers themselves.

Fleet (lifecycle), system (vehicle), subsystem and components – we focus on all of them

The (further) development of vehicle software offers a multitude of opportunities for your company:

Meeting dynamic expectations of customers
Providing new functionalities
Ensuring traffic safety through high-quality software
Meeting quality requirements through appropriate testing
Predictive diagnostics and fleet management as well as telematics
Secure access to vehicle data from any location
Enabling firmware updates over the air
Software for vehicle tracking
Developing vehicle navigation software that meets the needs of electric vehicle drivers

Automotive Software Engineering is the link between backend software applications and the hardware components of a vehicle.

The need for over-the-air (OTA) updates for software

The market for over-the-air (OTA) updates in the automotive industry has changed dramatically over the past year. Major automakers are pushing to roll out widespread use of OTA and deploy it for connected vehicles. New regulations for both OTA and cybersecurity have recently been passed (we reported on this) and more will be needed as the technology advances.

There are regulations that define the obligations of OEMs and suppliers when updating software to meet legal requirements.
The technical prerequisites for OTA updates and the know-how are already available.
In the future, automotive OEMs will not only “push” software updates but also other features over the air into vehicles. OTA transfers must therefore work for car manufacturers and will become a necessary competitive differentiator. Here lies great potential for new revenue streams.
Car buyers expect reliable and convenient OTA update functionality.
The use of OTA-transfer for additional functionality in connected cars is growing rapidly.

OTA software updates are on a rapid growth path. This trend is creating a strong market for OTA clients and an even larger market for cloud OTA services.

magility and Software Defined Products

Software Defined Products are more and more in the focus of all industries and especially of the automotive industry and its suppliers. Regardless of their size, this development will have a profound impact on companies. New strategies are needed to ensure survival in increasingly complex markets. At magility, we support companies in reviewing and adapting their corporate strategy, taking into account all the new factors impacted by the IoT, and in identifying and implementing measures for strategy implementation. This also includes the integration of new service segments and, if necessary, entire new business units. In this context, we cooperate with the International Institute of Information Technology in Bangalore, India. Dr. Roland Haas is a professor at IIITB and our specialist for Software Defined Products, OTA and software system competence for the automotive industry. Contact us now – we will be happy to answer your questions.