Japanese telecoms and IT firm SoftBank has bought a 51% stake in Irish software-defined connected vehicle company Cubic Telecom for €473m.

With this investment, SoftBank and Cubic will form a global partnership to pioneer the future of software-defined connected vehicles and other high-value IoT assets by harnessing the power of global connectivity platforms.

Cubic Telecom provides connectivity to automotive, transportation and agriculture OEMs, and, according to McKinsey & Company, 95% of new vehicles sold globally will be connected by 2030, and connected car use cases alone could deliver $250bn to $400bn in annual incremental value for the ecosystem, with Cubic Telecom poised to capture a leading share of this rapidly growing market.

After the investment closes, Barry Napier will continue to lead Cubic Telecom as CEO and board member, and Daichi Nozaki, SoftBank’s senior vice president, and two other SoftBank appointees will join Cubic Telecom’s board. Three board seats will continue to be held by Cubic Telecom’s existing shareholders, including Volkswagen’s Cariad division and Qualcomm. With the close of the investment, Cubic Telecom will become a consolidated subsidiary of SoftBank.

“With its global leadership position, we are convinced Cubic Telecom is the best partner for this opportunity,” said Junichi Miyakawa, CEO of SoftBank. “We look forward to building connectivity platforms for next-generation social infrastructure.”

Cubic Telecom’s Pace platform for application and connectivity enablement is a testament to the shift towards software-defined options and away from the legacy of hardware. The platform allows OEMs to monitor, manage and update many aspects of a vehicle or device in real time, globally, via mobile connectivity, meaning vehicles can be tailored to the requirements of a country or region while complying with different regulatory mandates.

Vehicles and devices can receive features and functionality over-the-air (OTA) throughout their lifetime, which improves performance, safety, comfort and value to ensure the best user experience.

Cubic Telecom has grown rapidly since launching its industry-first connectivity platform in 2016, and through agreements with more than 90 mobile network operators (MNOs), the company connects more than 17 million vehicles in over 190 countries and regions, adding 450,000 new vehicles a month, which is expected to increase exponentially over the next five years.

“This announcement marks a significant milestone for our team and stakeholders, and we’re excited to partner with SoftBank to pioneer the future of software-defined connectivity,” said Barry Napier, CEO at Cubic Telecom. “The focus on software rather than hardware means manufacturers can increase the value of a vehicle or device by adding new functionality, over-the-air, which will improve safety, comfort and performance. This, alongside the opportunity AI presents, will open up new collaborations and business models. The opportunities ahead of us are endless.”

Cubic Telecom (www.cubictelecom.com) enables the world’s major automotive, transportation and agriculture OEMs to accelerate digital transformation and better leverage software-defined technologies. The company is also developing services that leverage its platform’s analytics and, as cellular vehicle-to-everything (C-V2X) connectivity continues to be transformative, the partnership between SoftBank and Cubic Telecom will play a role in developing services and accelerating innovation.

While SoftBank (www.softbank.jp) has been providing global IoT connectivity services, mainly in Asia-Pacific markets, in this partnership with Cubic Telecom, it will be able to make a full-fledged entry into the rapidly growing IoT markets for connected cars and software-defined vehicles, giving it access to new revenue generating opportunities.

The investment is subject to regulatory approvals in various jurisdictions, and other customary closing conditions, and is expected to close in the first half of 2024.