SoftBank Invests $514 Million in Car Software Firm Cubic Telecom, Acquires 51% Equity Stake

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Published: December 05, 2023 at 8:04 am Updated: December 05, 2023 at 8:04 am

Edited and fact-checked:
December 05, 2023 at 8:04 am

In Brief

SoftBank is poised to invest $514 million in Cubic Telecom and forge a partnership to drive the future of software-defined connected vehicles.

The Japanese telecommunications division of the technology investment firm SoftBank Group —- SoftBank is set to invest $514 million in Cubic Telecom, a Dublin-based connected-vehicle technology provider, acquiring a 51% equity stake.

The investment will give Cubic Telecom a total valuation of over $975 million.

Additionally, the parties will join forces to pioneer the future of software-defined connected vehicles through a strategic global partnership, granting Cubic Telecom enhanced access to Asian automakers.

The deal signifies SoftBank’s largest overseas investment since its 2018 public listing. After the deal closure in the first half of 2024, Cubic Telecom will become a consolidated subsidiary of SoftBank. The companies also announced plans on leveraging the opportunities across the broader SoftBank group.

The Growing Influence of Connectivity in Electric Vehicles

Connected cars are vehicles that use connectivity and digital features to provide a superior mobility experience. With the growing adoption of electric vehicles, connectivity of vehicles is also increasing, signifying a notable trend.

Today, more than half of new cars sold globally offer some level of connectivity. Most of these features, however, are reactive and simple, allowing drivers to do things such as track their vehicle use and monitor basic technical status.

Nevertheless, according to McKinsey, by 2030, 95 percent of new vehicles sold globally will be connected.

Electric vehicles (EV), commonly referred to as “software-defined” — allow automakers to upgrade wirelessly. Within the EV evolving landscape, the industry is actively exploring diversified revenue streams through in-vehicle services, such as advanced mapping or fuel-efficiency features.

Cubic’s software plays a crucial role in facilitating aforementioned advancements, enabling automakers with access to mobile networks globally. The company’s software offers infotainment features and provides insights for automakers to understand car usage, facilitating the customization of future offerings.

Presently, Cubic Telecom connects more than 17 million vehicles, managing updates from the car’s assembly through its entire operational lifespan.

In another recent development, Hyundai Group announced deployment of updates on all its new vehicles to be launched starting 2023, to fully integrate digitalization with mobility. Last year, the company announced its plans for transforming all vehicles to software-defined vehicles by 2025.

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About The Author

Alisa is a reporter for the Metaverse Post. She focuses on investments, AI, metaverse, and everything related to Web3. Alisa has a degree in Business of Art and expertise in Art & Tech. She has developed her passion for journalism through writing for VCs, notable crypto projects, and engagement with scientific writing.

Alisa Davidson