IRIS CORP Bhd, which has seen the entry of new shareholders, is looking at putting in a bid to join the bidding for the mandate to undertake a government road tax and insurance initiative for the launch of a connected cars project. The other company which is interested in this project is GREEN PACKET BHD.
While this connected cars project will initially focus on usage-based insurance, it will subsequently involve usage-based road tax.
There is no figure to the contract amount.
However, the company that gets the mandate will have access to a trove of data on Malaysian drivers and vehicles.
“The golden goose for this project is in the data – Malaysian drivers’ data.
“The company will gradually build up data of all drivers who use their services,” says the source.
Currently, MyEG Services Bhd more or less holds the monopoly for road tax and driver’s licence renewals.
While its primary business activities are the development and implementation of e-government services, it also diversified into commercial solutions some three years ago.
MyEG’s commercial segment now contributes to 70% of group activities.
However, the connected cars project will generally offer lower rates for road tax and insurance.
“Vehicles will be charged based on the usage. At the moment, it is a flat rate,” says a source.
Connected cars are vehicles that are equipped with Internet access which enables data applications.
This helps provide better insight on driving patterns, behaviour and car conditions through real-time diagnostics and predictive maintenance.
The backbone of the connected cars project is the Internet of Things (IoT) technology.
In the IoT, machines connect with each other to process data.
Towards this end, Green Packet’s interest is not surprising. This is because last year, it acquired a 32% stake in G3 Global Bhd, the company formerly known as Yen Global Bhd which is involved in the IoT.
G3’s wholly owned subsidiary Atilze Digital Sdn Bhd was previously in collaboration with Axiata Group Bhd for a connected car solutions project in 2016.
At that time, Atilze said that the connected car solutions would have a range of applications which include advanced diagnostics, predictive maintenance, real-time fleet monitoring and management, driving pattern analysis, Advanced Driver Assistance Systems (ADAS), in-car WiFi, in-car Infotainment, in-Car e-Commerce, electronic gate-less toll payments and usage based insurance.
Green Packet recently secured a major government contract to supply 3.6 million set-top boxes for MYTV Broadcasting Sdn Bhd for two years.
MYTV is the company tasked by the Government to handle the free-to-air TV migration from the existing analog system to digital.
The Government has said that a total of 4.2 million BR1M (1Malaysia People’s Aid) households will receive free MYTV decoders.
Meanwhile Iris’ interest is also not surprising.
The company’s new shareholders are Datuk Rozabil Abdul Rahman and Datuk Paul Poh who together with Felda Investment Corp hold a majority stake.
Previously, Iris was known as the company that provided the chips imbedded in all Malaysian passports. It was a feature then that prevented forgery and fraud. Iris exported the technology to several third world countries.
In 2016, Iris took a major hit when its contract to supply electronic passport chips to the Government was not renewed. The contract was later awarded to its direct competitor Datasonic.
Nonetheless its fortunes appear to be improving with the entrance of Rozabil and Poh. Last December, it received a RM4.96mil passport contract from the Home Affairs Ministry, which will be for a duration of three years.
While the contract is small in size, it shows that Iris has the clout to garner government contracts.
Meanwhile on the connected cars contract, a dongle will need to be placed inside each car, where the driver’s behavioural analytics will be tracked.
Through this, motor insurance companies will be able to drastically reduce claims loss and gather data. Users will pay their insurance premiums or road tax based on how they use their cars.
There appears to be support for this sort of initiative from the Transport Minister.
Last July, Transport Minister Datuk Seri Liow Tiong Lai mentioned that drivers were encouraged to have a connected Advanced Driver-Assistance Systems, or Adas, in their vehicles, as it had been proven to reduce road accidents.
“The Transport Ministry will also study the possibilities of having this system installed in commercial vehicles such as buses and taxis.
“Features such as driver records, dashboard cameras and a driver alert system can help reduce accidents,” he was quoted as saying during an event last year.
Liow had also mentioned that the Government could also consider introducing a flexible road tax payment system that would reward drivers with clean records.
“We recently implemented the liberalisation of motor insurance where car owners pay less premiums if they have better driving records.
“In the future, we could implement a similar system on road tax. But this is just for consideration,” he had said.