—– Original Message —–

From: Salvador Minguijon

To: Salvador Minguijon

Sent: Friday, December 22, 2006 7:02 PM

Subject: “Pay As You Drive” Information

Dear ladies and gentlemen:
 
            In first place, we should take into acount that during several days you will be able to see the presentation of the system PAYD of IMS.
 
            A very interesting article has been published in the Blog “Enterprise Decision Management“.
 
            We also have also some details of the project of Winterthur with the black box. And it can be interesting to remember you the option of Norwich for the insurance of vehicles fleets, as a completely independent product of the Pay As You Drive.
 
            There are some technical articles that make reference to the precision in the localization, the confidentiality in the information or the cost of the automobile insurance in England.
 
            There is a publication that picks up a italian judicial sentence based on the information obtained with the device UNIBOX of a client of Unipol.
 
            We also have a very significant site of the State support that this project is having in Holland or a publication that exposes the paper that this project can carry out in the politicians for reduction of the emissions of CO2.
 
            We have information of the activities of IBM through one of their suppliers again. The project in which is working doesn’t practically have public repercussion, but we cannot make the error of forgetting it. IBM takes several years of advantage with regard to any other technology supplier and its project in the Arab Emirates will probably make this advantage increase.
 
            In relation with this topic, it is advisable to read my publication “Positioning strategies of the technology companies regarding to the projects Pay As You Drive” and the article published in Computer Business.
 
            The project Road Charge generates a lot of information. More and more the possibility of their future installation is getting obvious and this implies automatically the project”Pay as you Drive”. At the end of this document I attach you what this month has been published.
 
            I have upgraded my database “Pay As You Drive Directory”.
 
            Please, have a nice new year and merry Christmas.
 
            Yours sincerely
 
 
                                                           Salvador Minguijon Perez

 
Road Charge News:
http://icwales.icnetwork.co.uk/0100news/0200wales/tm_headline=firms-willing-to-support-some-road-charging&method=full&objectid=18128568&siteid=50082-name_page.html
 
http://news.bbc.co.uk/1/hi/uk/6160174.stm
 
http://today.reuters.co.uk/news/articleinvesting.aspx?type=personalFinanceNews&storyid=2006-11-27T075909Z_01_NOA728613_RTRUKOC_0_BRITAIN-ROADS-PRICING.xml
 
http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2006/11/30/uroads130.xml
 
http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2006/12/02/nroads02.xml
 
http://icnewcastle.icnetwork.co.uk/thejournal/regional/tm_headline=congestion-tax-could-dual-a1-20-times&method=full&objectid=18170518&siteid=50081-name_page.html
 

Positioning strategies of the technology companies regarding to the projects “Pay As You Drive.”

One of the particularities of this project is its capacity to activate the imagination of companies and people related with new technologies. A few companies of the management fleet or anti-theft electronic branch, have seen in this market a new opportunity for their already existent or lightly adapted products. 

These companies know very well how difficult the project is, they identify that their clients are the insurance companies and they only seek to offer them the physical support to execute their projects. This is a very important market to them and with a great capacity of grow, but they also know their own limitations. If the market reaches mass size, other better technologically adapted to this type of markets companies will substitute them, but this can last a dozen of years. An eternity for this type of companies which will use these years to develop other markets and applications. 

On the other hand, the capacity of the insurance companies to lead and to throw a product of this type is very limited, so they usually meet with very receptive clients but that don’t very well know neither what they want neither how they want it. What the insurance company follows is usually to “prove” and to acquire knowledge on this aspect. Practically all the insurance companies have already made “something”, always with the collaboration of an university and a small technology company. For desperation of these small companies most of the insurance companies don’t decide neither to discard the project neither to throw it, but they leave it indefinitely in stand-by, with the hope that the external circumstances dissipate some uncertainties. 

Some have had the luck, or ability, that the insurance company has created a special product to carry out this test. For example, to offer a discount to the clients in the insurance policy when they install a Black-Box in their vehicle. This gives information to the insurance company for its analysis. There are another group of technology and communications companies that aspire to play a predominant part in the future traffic control. For these companies the project “Pay as you drive” is only the first step to reach enormous dimensions and possibilities markets. But for the insurance companies, the projects proposed to them by these companies produce frenzy, they are two worlds with markets and concepts of time radically different. 

The insurance companies are not willing to put in danger their credibility, neither to invest in promotional campaigns if there is some uncertain in some aspect. The insurance companies assume the risk in their operations very well, although it is high, but they need to know the dangers that can face and to value the impact that can have in the results. They don’t admit the “we will solve it when the moment arrives”, because in many occasions it is the insurance company the one that has to pay the consequences. These technology companies identify the public administration as their client, to the one they try to offer their solutions about tolls, tax, infrastructures, information management regarding to traffic. Sometimes still including this project in a wider program such as communication Machine-To-Machine M2M. They don’t understand the insurance companies, and think they would be retrograde, slow and obsolete. 

In fact the insurance companies move in a very special market that is necessary to keep in mind to understand them: The most particular thing is that it is very normal and typical that the results of their strategic decisions take place with a retard of tens of years. In this environment it is normal that any decision should be thought and evaluated in its most minimum details before carrying out it. 

The second particularity is that the products offered are very limited, their possibilities to substitute products, to look for other markets etc. are minimum if we compare them to the industrial and even financial activities. The third is that their more important capital is the trust of its clients in its solvency. Activities that can transmit the sensation of economic weakness or failure cannot be allowed. 

In the last years the insurance of the automobile has developed in such a way that many insurance companies suffer it like a stone in their shoe. This market doesn’t have anything in common with the rest of its products and it seems even that every time is more different.  The technology companies clearly identify that the application “Pay as you drive” can be a wonderful entrance door to an entire group of future applications, but they aren’t being able to understand the insurance companies. In fact, it is surprising that the directors of these projects are not people that come from the sector of the insurance, without any doubt some would favour the development of these projects. Obviously this defect in the offer of the market has been detected by some technology companies and overalls technological consultants. They are trying to define projects guided towards the insurance companies, led by people that know the problem of this sector and are able to structure viable projects.