IMS Delivers on Security, Data Collection Integrity, and Information Availability

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1 WHITE PAPER DEPLOYING A CONNECTED CAR SOLUTION WITH CONFIDENCE: IMS Delivers on Security, Data Collection Integrity, and Information Availability

2 Executive Summary 1 Introduction 2 End-to End Security 3 Security and Data Privacy are Core to Successful Automotive Telematics Application Deployment 3 Secure Path from Device to IMS 4 Device Security 4 Information Availability High Availability and System Redundancy 4 Conclusion 5 About IMS 6

3 DEPLOYING A CONNECTED CAR SOLUTION WITH CONFIDENCE 1 /10 Executive Summary The automotive industry and its surrounding ecosystem are poised for significant growth in the area of telematics and connected car services. With the proliferation of smartphone technology and some key regulatory moves, the connected car has quickly become the fastest growth opportunity for the automotive market. Key revenue derived by service providers for the connectivity and other basic value-added services they provide to the automotive, transport, and logistics (aka connected car) segment is expected to more than triple from 2013 to 2018, to $16.9 billion worldwide. 1 Infonetics also observes that the connected car services market is growing at a compound annual growth rate (CAGR) of 25%, nearly 21 times the growth rate expected for traditional mobile voice and data services during the same time period. Within this macro market, the connected car presents a multitude of business opportunities for solution providers within several areas: usage-based insurance (UBI), fleet monitoring/ management, road charging (tolling), and traffic routing. For example, the fleet management market is expected to grow from $10.91 billion in 2013 to $30.45 billion by 2018, a CAGR of 22.8% from 2013 to In addition, as more and younger drivers enter the market, there is an opportunity to increase overall road safety by creating educational programs and to actively coach them real-time as they develop their driving skills. All of these opportunities provide benefits both to the companies who develop these programs and to the drivers who take advantage of them. The automotive telematics market is by nature, very data-intensive. As millions of drivers become connected and take advantage of connected cars, the IT requirements to support these programs become very large and potentially expensive to support the large data and security requirements. Deploying connected car solutions through a SaaS model enables companies to enter these markets with lower risk, quicker deployment, and lower costs. According to Ptolemus, an automotive telematics consulting firm, companies who utilize a SaaS infrastructure for UBI programs can reap up to a 70% cost savings in administrative costs. 3 As the ecosystem evolves and grows, those companies who take advantage earlier than later can reap the benefits of certain market dynamics. For example, in the insurance industry, companies who enter the UBI market earlier can capture the more financially attractive, lower-risk drivers in the pool of potential customers. As more and more companies compete for customers, the higherrisk, more expensive drivers will be the ones left at the end. In addition, as more and more data is captured from the drivers, the analytics becomes more valuable with more accurate segmentation and predictors. While the business side of the equation has its own set of questions, IT leaders have a seat at the table when considering a services provider to enable connected car solutions within 1 Connected car service providers to reap $17B in 2018 as GM, BMW, Tesla and others ramp smart apps; John Byrne, Infonetics, Fleet Management Market by Components, Technologies and Services (Fleet Analytics, Vehicle Tracking & Fleet Monitoring, Telemetric, Vendor Services), by Fleet Vehicle Types (Trucks, Light Goods, Buses, Corporate Fleets, Container Ships, Aircrafts) - Global Forecast to 2019 Markets and Markets, html: October Ptolemus, April 2014

4 DEPLOYING A CONNECTED CAR SOLUTION WITH CONFIDENCE 2 /10 their organization. IT personnel, by definition, play a key role in ensuring the services provider meets their security, availability, and data integrity requirements in the same manner they would as if they deployed the solution on-premises. Due to the sophistication and expertise required to run a bulletproof, secure, compliant, and highly functional infrastructure, business and IT leaders must systematically evaluate and vet their managed service provider to select a partner that best meets their business needs. 4 IMS offers a broad range of end-to-end automotive-based telematics business solutions based on its DriveSync connected car platform. IMS delivers a strong IT value proposition that enables IT leaders to confidently deploy connected car services and solutions and create new revenue streams and programs. The foundation of the IMS service platform is based on end-to-end security, integrity of collected data, and information availability. Introduction Vehicles have evolved over the years from being simply modes of transportation to being advanced mobile connectivity platforms. The connected vehicle is fast becoming the center of business opportunity whether it is car manufacturers, insurance companies, fleet management firms, or infotainment service providers. Many of these services are delivered as turnkey, SaaS-based solutions. Information collected from vehicles can be used both at an individual level (i.e., GPS-based fleet management), or at an aggregate level (i.e., analysis of large groups of drivers driving habits for refining insurance premiums). Other applications, such as road-use data (for tolling), and crash-detection (emergency response), rely on in-car telematics as well. Companies such as insurance providers that wish to leverage vehicle telematics data as a means to both improve their bottom line and reward good drivers with safe-driving discounts, should consider end-to-end security, integrity of data collection, and information availability as key capabilities of their solution partner. Privacy of policy-holder data is paramount to increasing adoption rates because one of the largest barriers to adoption is how the data will be used and how much personal information is collected. Since the data is confidential, ensuring its security is also very important. This means knowing that the vehicle data safely travels from the in-vehicle device to the program database. In addition, once the data is in the database, it is important to have access and authentication policies in place to make sure the data stays secure and is only used by people who are authorized to do so. Finally, depending on the application, these programs become business-critical to the operations of many companies. It is very important to have access to the data on a 24/7 basis. Therefore, when selecting a partner to provide these services, it is important to make sure their IT platform delivers the high-availability requirements needed to provide access to the data and applications at a busines-critical level. 4 Five Key Characteristics to Look for When Selecting a Managed Hosting Service Provider; Chris Patterson, 6/30/2014

5 DEPLOYING A CONNECTED CAR SOLUTION WITH CONFIDENCE 3 /10 The IMS production environment is built on a highly available, scalable architecture, providing flexibility for our clients and ensuring security, integrity, and availability of their data. Utilizing an IMS end-to-end solution powered by DriveSync, client IT departments can remain confident that their specific program requirements are professionally outsourced and managed, enabling them to focus on their day-to-day operations and support. With IMS, client IT departments get the benefit of a fully managed solution without the complexity of purchasing, owning, and deploying new internal and customer-facing systems. The IMS hosted platform service delivers benefits in three key areas: > End-to-End security: End-to-end policy and process to ensure secure management of client data > Data collection integrity: Checks and balances in place to identify anomalies and avoid data corruption > Information availability: High availability, load balancing, and internal redundancy resulting in high levels of system uptime and ensuring that clients of IMS (and the client s customers) have access to their data when they want it This white paper will explore each of these areas in more detail. Please note: IMS respects the privacy rights of its customers and end users and is committed to keeping personal information accurate, confidential, secure and private. IMS complies with privacy laws and regulations that are applicable to the provision of its services and technology. IMS collects personal information in the normal course of providing its products and services and uses such information only for purposes it has already identified to the individual or as permitted/ required by law. IMS collects personal information using procedures which are fair and lawful, and collects only the amount and type of information needed for the purposes identified to the individual. It is important to note that IMS-backed programs are generally set up by our partners as opt-in programs, meaning that the end user has the choice to join the program, and provide consent to the collection of personal information and driving data. For more information, please refer to IMS s privacy policy which can be found here: End-to-End Security Security and Data Privacy Are Core to Successful Automotive Telematics Application Deployment Choosing the right partner is critical. The organization you choose should be an expert in network security and infrastructure, should have experience running the applications your organization uses, and should be a partner you can trust to provide cost-effective services securely and reliably today, and in the future. 5 5 Competing More Effectively with a Managed Service Provider; 2012

6 DEPLOYING A CONNECTED CAR SOLUTION WITH CONFIDENCE 4 /10 One of the key elements of the IMS production environment is end-to-end security delivering confidence that client data is secure from origin to its resting spot within the IMS data warehouse. In addition, external access points (i.e., IMS clients with web and secure FTP access) have security measures in place to prevent unauthorized access. Secure Path from Device to IMS Secure management of data starts with the vehicle. The device collects and communicates information only in response to vehicle ignition and trip completion. The device itself only retains the data collected from the vehicle if the end of trip is out of a cellular coverage area. Communication is only initiated by the device it does not accept communications initiated by outside sources. The device can communicate only with the IMS production environment and only via a secured private network. The device contains a tamper-proof carrier SIM card, similar to those found in GSM and 4G smartphones, which provides secure access to the carrier network. When preparing to transmit data from the vehicle, the device establishes a one-way secure connection with endpoints. Security is further enhanced by the fact that only the device can initiate communications; the server cannot. Strong security protocols are inherent in the carrier network to protect data transmissions. The carrier network communicates with the IMS security infrastructure via a VPN tunnel. In addition, the data is encrypted using 256-bit AES encryption. At this point, there is a very secure path from the device to the IMS systems. SSL & SFTP SECURE VPN INSURANCE PROVIDER AES AES SSL CARRIER NETWORK INTERNET INTERNET POLICYHOLDER IMS FIREWALL SSL & SFTP Figure 1: The IMS End-to-End Data Security Implementation LOGISTICS PROVIDER Device Security The security of the in-vehicle device cannot be viewed in isolation it must be evaluated in the context of the overall system as deployed. IMS places a strong emphasis on end-to-end security of the device over and above what may be found in the telematics programs of other vendors.

7 DEPLOYING A CONNECTED CAR SOLUTION WITH CONFIDENCE 5 /10 Data Collection Integrity Another key benefit that the IMS solution powered by DriveSync provides is data collection integrity. It is very important to ensure that the data collected from the vehicles is retained in its raw state so that if data corruption occurs somewhere during ingestion and processing, the original data can be restored. Once the data is collected and is captured by the Device Management Gateways, a master copy of the raw data is made and retained. As the data travels through the IMS systems, as well as when it is at rest, the data is checked against the original copy for accuracy. If corruption happens, administrators are notified. The original data can then be restored to the appropriate point in the process where the corruption occurred. Operations and processing will then resume as normal. Data is then destroyed once expired per the IMS data retention policy. It is considered a best practice to ensure that the data that is collected from the vehicle is not only protected, but maintains its integrity. Information Availability High Availability and System Redundancy The production environment at IMS has been built to ensure high information availability and scalability. IMS production systems are hosted at a CICA 5970 and SSAE (Type II) certified hosting facility within Canada. The facility is engineered to deliver % availability, featuring redundant power, cooling, and network infrastructure. IMS works with its clients to understand any unique business continuity requirements for each solution it provides. The IMS production environment consists of physical and virtual components. The physical components have full internal redundancy wheras the virtual systems operate in a high-availability cluster. Every component from the firewalls to the storage systems has a comparable or identical unit ready to replace it. All systems and components are actively monitored to maintain health and a high level of service without interruption. The system architecture is also designed to scale and grow as the client s needs expand. Applications and data are deployed to the resource best suited to support the scale of the deployment. Conclusion As the connected car market continues to grow and evolve, there are many opportunities for service providers to capitalize on the data that can be generated through driving. Organizations can economically take advantage of the opportunity through Telematics as a Service TM (TaaS ) which is a means for companies looking to utilize one of the IMS telematics solutions without start-up or device acquisition costs. This type of offering provides the programs companies want without upfront device fees, and also allows them to take advantage of manageable monthly costs with flexible commitment and volume terms. CIOs and security executives within these organizations should look for service providers who can deliver a highly secure, scalable, and highly available environment. IMS has been delivering connected car solutions since 1999, and delivers a high value telematics-based platform which delivers end-to-end security, data collection integrity,

8 DEPLOYING A CONNECTED CAR SOLUTION WITH CONFIDENCE 6 /10 and information availability. IT decision-makers can feel confident that IMS has the technology, processes, and people to make telematics programs successful within their organizations. About IMS Intelligent Mechatronic Systems Inc. (IMS) is a leader in connected car technology that enables drivers to be safer, smarter, and greener. Our unique approach of converging in-car infotainment, automotive telematics, and wireless technology has resulted in an impressive range of solutions. IMS is committed to maintaining an IT-compliant production infrastructure for its clients solutions by focusing on delivering end-to-end security, data collection integrity, and high availability. Clients can be assured they not only have access to their customers data 24/7, but their data is protected and managed in accordance with industry best practices. As a leader in this space, IMS is continuously working to improve the security of its systems and deployments. IMS has committed to a number of significant security enhancements. As its security program evolves, IMS updates its effective Information Security training program to ensure execution of the security mission. For more information and inquiries on IMS and available connected car solutions, visit or DOWNLOAD THE EXPANDED VERSION OF OUR SECURITY, DATA INTEGRITY AND INFORMATION AVAILABILITY WHITE PAPER Are you interested in learning more about our IT infrastructure and its benefits to your organization? We have an expanded version of this White Paper which includes functional and technical details of our stringent IT requirements for all our connected car solutions - available by request and upon signing a Non-Disclosure Agreement with IMS. Featured Content includes: > High-Level System Architecture > IT Operations Control and Monitoring > Load Balancers > Production Firewall Cluster > High Availablility Servers > Virtual Clusters > Physical Security Infrastructure > and more... This expanded version of the White Paper is available under NDA. Please contact and IMS will follow-up with you within 3 business days.

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