The race to dominate the in-car technology market took a new turn this week when Apple unveiled its long-awaited in-car system, CarPlay.

Originally discussed at last year’s Apple Worldwide Developer Conference, the new system will be available as an update to iOS7 and provides access to calls, messages, maps and music through a mixture of voice control with Apple’s “digital assistant” Siri and the car’s built-in system.

First to get it are Ferrari, Mercedes-Benz and Volvo, with other manufacturers expected to follow.

“The car effectively becomes the second screen for the iPhone,” said Forrester analyst Frank Gillett. “This will make things extremely easy for consumers to use, because we already know how to use our Apple devices.”

Apple made the announcement ahead of this year’s motor show in Geneva.

Emerging market
It's another step indicating that mobile makers are looking more seriously at cars as a new market. The days when in-car technology was limited to your music system – the iPod has supported integration with some cars for a decade or more – and possibly GPS if your budget stretched to it are long since gone.

These days, it’s common to find Bluetooth built into your vehicle, with more expensive options including a built-in mobile connections to download everything from updated maps to the latest news headlines.

For the car firms it's an admission that their proprietary systems didn't meet the needs or tastes of younger tech-savy customers who were more excited by the latest apps than the latest Audi. There's a cohort of urban middle-class twentysomethings that are apathetic to the motoring world but fixated on gadgets. Rather than trying to compete with the tech firms for in-car infotainment, auto firms are now resigned to letting their dashboards be conduits for software applications from dedicated tech giants.

A study by Accenture last year indicated that almost 40 per cent of car buyers rate in-vehicle technology as a main selling point when it came to buying a vehicle. That compares with 14 per cent who said performance of power and speed would be their first point of interest.

At major technology shows such as consumer electronics show CES, it's no longer unusual to see carmakers unveiling their wares alongside laptop makers and mobile firms. This year's CES had a record number of car firms exhibit at the event, while Mobile World Congress in Barcelona has also played host to firms such as Ford.

Innovate to prosper
At the Geneva Motor Show this week, Mercedes-Benz boss Dieter Zetsche laid out the reality as he sees it, telling attendees that carmakers would need to make sure vehicles could connect to mobile devices and the internet to ensure survive.

“Virtually no product, including the automobile, is purchased or used in a vacuum,” he said. “We all know that the iPod, for example, was not just a game changer based solely on design or technology. It is also about the convenient connection to iTunes.”

Mercedes-Benz is hedging its bets – while signed up with Apple, it said it will also ensure that its cars will work with Android technology, which has a larger share of the smartphone market than Apple.

Mercedes used the Geneva show to unveil its new service brand “Mercedes me”, which allows car owners to access service bookings or access the company’s car-sharing business car2go.

In addition to allowing car owners to customise their own entertainment and communications packages, BMW’s in-car technology also provides a revenue stream for the company, through ConnectedDrive. It also means that consumers can upgrade at the touch of a button, adding new services such as concierge and real-time traffic data subscriptions without having to set foot in a garage.

While the high-end vehicles have had the advanced technology for some time, it seems more keenly-priced vehicles are also getting the smart treatment as car firms try to tap into an increasingly tech savvy younger audience.

“What used to be a feature seen in premium cars is now coming into the low and medium end of the market,” said Dinesh Paliwal, chief executive of Harman International, which makes “infotainment“ systems. “It‘s driven by a change in lifestyle where people no longer want to stop being connected just because they are in a car.“

Sync system
In-car technology an area that Microsoft has been active in for some time. The company's Windows Embedded Automotive technology has been used in Ford cars for its Sync system since 2007, allowing users to make calls and play music handsfree, as well as navigate and perform vehicle health checks. More than seven million Ford cars on the road have the Sync system and, as car buyers look for more high-tech extras, that looks set to rise.

However, technology moves fast, as Microsoft has found to its cost. Ford is dropping its Microsoft link from 2016. Reasons for the move have been the source of much speculation, from flaws in in-car technology to the desire for something speedier and more flexible.

Microsoft's loss could be BlackBerry's gain if reports are true. The troubled smartphone maker may have been struggling in its once dominant market, but it seems that it may have struck gold in car technology, with Ford said to be eyeing its QNX platform as a replacement. QNX, considered one of the jewels in BlackBerry's crown, is also used by Audi, Porsche, BMW, Chrysler, Porsche and Saab vehicles.

The QNX technology also has the added advantage of being less expensive, a weighty consideration for companies facing increased competition.

However, it’s not all about infotainment. While some technology has been developed for entertainment and communication, there are other developments focused on safety and reducing accidents.

That is where the “self-driving” car technology has come into play, with everything from self-parking cars to cars that will identify potential hazards on the road already on the market. It’s set to go a step further in the future, although there are some issues still to resolve – such as who bears responsibility in the case of an accident.

Google's self-driving cars, kitted out with a array of sensors, are being trialled on the streets of Nevada. Daimler said last year it plans to have a self-driving car on the market before 2020, while BMW has also been testing cars that can change lanes automatically, adjust speed according to surrounding traffic and generally take over the more tedious parts of the commute.

However, the important element of the equation is that the driver can take over at any moment should something unexpected happen. Daimler’s system is similar, allowing drivers to take back control when conditions are more challenging, such as traffic lights or cyclists in urban locations.

The reality appears to be that the connected vehicle is no longer a far-off aspiration.