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Build vs Buy OTA Software: 5 Considerations for OEMs

January 14, 2021

OTA Logger
OTA Updater
Industry Insights

With the connected car revolution well underway, over-the-air (OTA) software quickly become an industry standard for automakers. OTA can not only reduce consequential software recalls and create new revenue opportunities, but also enhances the customer experience by shortening the time required to update, fix, and maintain vehicles throughout their entire lifecycle. 

To sustain a competitive edge, manufacturers are having to completely reassess their end-to-end development processes to incorporate next generation OTA software capabilities. Determining whether to build in-house or buy existing solutions depends upon the specific needs and circumstances of the OEM and their unique business model. In this blog, we break down the 5 most common build verse buy factors that OEMs must consider for their OTA journey.

1. Time to market: 

As auto tech continues to evolve, product life cycles will be faster than anything OEMs have previously experienced. Given this rapid turnover, product time to market could be the difference between success and failure. 

Building in-house OTA takes longer because it requires an entire team dedicated to the research, design, and implementation, followed by a series of pre-market tests to assure compliance with safety and security protocols. 

In contrast, out-of-the-box OTA software is purpose built for rapid integration. Platforms often include pre-tested protocol libraries, such as Sibros Network Stacks, to ensure compliance with international automotive safety and security standards. These solutions eliminate the hassle of unexpected delays and expedite product time to market. 

2. Total cost of ownership: 

Although in-house OTA software comes with more control, the tradeoff is a significantly higher price tag. Building in-house software costs between two to twenty times as much as buying an existing solution that can be configured to the OEMs requirements.

Common direct and indirect costs include: 

  • Initial research and development
  • Testing and validation
  • Integration with legacy systems
  • Safety and compliance testing
  • Bug fixes and delays
  • Long term support and maintenance
  • Software update failure troubleshooting
  • Emerging regulatory compliance (Such as WP29 and CCPA)

OTA platform companies in most cases are able to offer more affordable solutions due to economies of scale by serving a wide swath of customers. Buying an existing OTA software solution frees up funding OEMs to utilize in other areas of product development and reduces the number unforeseen expenses that occur during in-house production and with ongoing support.

3. Desired features and functionality: 

Out-of-the-box OTA solutions are unquestionably more economical and faster to integrate, but sometimes come with customization limitations. However, this should not be mistaken for inflexibility, as properly architected and modularized OTA solutions are indeed highly configurable.

Since ready-made OTA systems are designed to serve multiple customers, they tend to include more general features that support a variety of functions. Flexibility varies between OTA platforms, though some features such as cybersecurity, tend to come as a standard, albeit at varying levels of surface attack area coverage.

A commercially available OTA solution may very well check all feature requirement boxes. In the event it does not, many companies will take an "80/20" fit gap approach. This approach considers meeting 80% of requirements, whereby the outstanding 20% of requirements of can be realized through future releases, enhancements or configuration. Either case more often than not presents a cost benefit cost to building OTA in-house without compromising desired features or functionality.

Due to the industry’s rapidly evolving demands, OTA providers are continually working to enhance their solutions’ features. One example is the ability to perform full vehicle OTA updates, as seen in Sibros’ Deep Connectivity Platform. Solutions such as this, not only expedite update time but help solve compatibility issues that occur across multi ECUs updates as compared to single unit updates. 

4. Available knowledge and expertise: 

Modern connected cars require more lines of code to function than a space shuttle,(3) thereby creating lots of room for error and things to go wrong. This puts OTA a uniquely complicated category with a tremendously vast and extensive knowledge set needed to design, test, implement, and maintain OTA software that supports the full vehicle connectivity at scale.

OEMs must consider whether they have access to the right expertise required to build in-house OTA software that is sustainable. Such teams must possess the right mix of skill sets not only to develop and integrate the software, but also to navigate unexpected bugs while addressing long term support, enhancements and maintenance.

Furthermore, new solutions must adhere to current international security standards, have the ability to rollback faulty updates, include data-analytics to anticipate future updates, and account for potential ECU/OTA software compatibility issues. 

Developing in-house places extremely high demands on company resources and should only be considered if the manufacturer is able to produce software that is as good as or better than existing solutions 

5. Core competencies: 

OEMs must consider the core in-vehicle software itself (that OTA is responsible for managing) to be a central focus. This is where OEMs are investing significant time, money and resources as the proliferation of a vehicle's technology over time can ultimately determine the success of a vehicle's brand and the customer experience.

For OEMs, OTA software is only one part of the bigger picture. Building OTA in-house siphons resources away from other areas of product development or innovation. It can lead to product launch delays, over extension of resources, and additional investment for external support should in-house initiatives fail to meet the mark.

If building OTA in-house guaranteed a considerable industry advantage or ROI, the investment of resources would be inconsequential. However, without the luxury of fortune telling, OEMs should consider the concessions required to dedicate an entire team to OTA software development and maintenance.


Although building in-house can at times offer more flexibility, the industry currently leans heavily towards purchasing. The acceleration of the software defined vehicle has made vehicle software development and management more complex than ever before. Developing OTA platforms in-house can add another layer of complexity for OEMs that can otherwise be fulfilled by partnering with software companies that specialize in OTA. Simply put, ready-built OTA solutions can prove easier to integrate, more cost effective and require fewer OEM resources while offering the ability to meet or exceed an OEMs specific OTA requirements.

Albert Lilly
Albert brings over 20 years of industry focused enterprise software marketing and business development experience ranging from VC-backed startups to large scale tech organizations. He is a University of Texas at Austin alumnus.
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