All those who thought telematics was a new wave band from 1981 - sorry, nil points. While the word was unknown to the automotive industry just a few years ago, telematics is now top of the pops among carmakers as the ever richening technologies of in-car information, entertainment and communications continue to converge on car cockpits.

Telematics describes the new umbrella technology that enables such devices to communicate with each other, and to be easily accessible within the driving environment. The market for telematics, currently estimated to be worth $8bn (£5.46bn) a year, is expected to treble by 2006 as the cockpits of even mainstream economy models begin to bristle with satellite navigation systems, breakdown buttons and internet access.

Carmakers believe the array of services they offer to their customers will become critical product differentiators in the near future. Cynics might suggest such differentiation is necessary, given the proliferation of platform sharing, and the increasing isolation of customers (and the aftermarket) from what's beneath the bonnet.

The mobile telephone has been the single most important catalyst to the growth of telematics. An integrated in-car mobile telephone provides the portal for services as technically straightforward as accident alert (whereby a serious crash triggers a call to a network operator for the emergency services), to rather more luxurious services like navigation assistance, e-mail, on-line commerce and even the long-heralded, truly mobile office.

Consider for a moment accident-alert, already fitted to high-end BMW and Mercedes-Benz models. In a less severe example, the same hardware, responding to information from the car's engine and chassis computers, can automatically telephone the dealership to book a routine service. It would even relay an order for any specific parts it needs.

Theoretically, the car's telematics system could also scan the owner's PDA (personal digital assistant) diary, sitting in its dashboard cradle, to suggest a convenient date.

Telematic interaction between on-board navigation and the owner's PDA has already empowered the car to navigate the driver to any address he nominates in his contact book. These same telematic features - available already in Mercedes-Benz's high-end Comand system - will clearly be a boon to the sales representative, whose in-car system can carry real-time data on current stock, orders, prices and so on (courtesy of a company's intranet). At the voicing of a client's name, he will be navigated to the address, dodging the worst jams thanks to real-time traffic information.

Clearly, parallels exist between automotive telematics today and the late-1990s dot-com boom, when entrepreneurs' imaginations (and venture capitalists' gullibility) seemed to be the only limits to the services that could be offered via the internet. At least automotive telematics knows where it's headed.

In January 2000, the European Commission launched the Multimedia Car Platform (MCP) project, aimed at establishing a technological standard for car internet terminals and the networks that serve them. MCP is being developed by a consortium of electronics, telecommunications and automotive companies, the latter being BMW and Seat. The MCP project has already produced a mobile API (application programming interface), modeled after the domestic multimedia software standard.

The MCP mobile version is actually more clever, having to allow for interaction with GPS navigation systems, as well as mobile phone and PDA, wireless (e.g. Bluetooth) accessories, a carmaker's specific uses (like the servicing scenario above) and, critically, voice-recognition commands.

Once the standardised API is accepted and the core hardware becomes commonplace, the path will be clear for the aftermarket to develop plug-in components and software tweaks - most likely, to the chagrin of the car manufacturers. Indeed, with the computer and car industries blurring together in telematics, it will be interesting to see if the recent outcry against Microsoft's alleged 'component packaging', will force car makers to open their products to the aftermarket.

Meanwhile, just as pocket calculator designers rue the enormity of our fingers, so telematics crystal-ballers bemoan our scarcity of limbs. BMW's new 7-series saloon has introduced the controversial 'iDrive', a cockpit control button on the centre console that is, in operation, the equivalent of a computer mouse.

The iDrive controller slides fore and aft and from side to side, to access four major function groups: entertainment; climate control; navigation; communication. The same button, which also rotates and delivers intuitive “force-feedback”, likewise controls all subsequent layers of the chosen menu, which one views on the dashboard-mounted display.

BMW and arch-rival Mercedes-Benz, in their uppermost luxury models, already offer WAP internet access - typically through a dedicated, personalised web portal. WAP itself is expected to leap in practicality and popularity when mobile phone networks switch to the more efficient GPS transmission method.

What matters most is a driver's method of locating and processing all this information, while supposedly piloting two tonnes of motor vehicle. The most favoured technology is voice recognition. Jaguar was the first to introduce this technology, on its S-type in 1999. The first-generation of the Visteon-supplied system controlled only the sound system, climate control and telephone; a second-generation, introduced in 2001 in the Jaguar X-type, adds control of the navigation system.

Current voice recognition systems are, however, still relatively crude, and unable to process complex instructions. Perhaps they won't need to. Using the mobile phone connection, a driver's voice commands can be relayed to an off-site server running appropriately powerful software, which can process the data before transmitting it back to the car.

Perhaps the best solution of all is the combination of voice recognition and a spare human. Fiat (and Alfa Romeo), General Motors and Ford are all in the process of rolling out in-car information systems that use an integrated mobile telephone to connect to manned, 24-hour call centres. Fiat's multilingual Connect centre in Milan is already operational, and accessible to owners of Alfa 147 and 156 models, Fiat Stilo and Lancia Thesis.

Rather than fish around a website for the name and address of a restaurant, Connect users press a button to contact a live operator to access weather and traffic information - even make entertainment bookings. So, make that two tickets to the telematics, please. They're the next big thing.