Imagine you're driving on a motorway and someone in front changes lane without warning. You try to take evasive action in time to avoid an accident.

In the near future your car could be the one taking control if it has a vehicle to vehicle (V2V) communication device fitted which allows cars to "talk" to each other.

While the notion of driverless cars and smart vehicles has long been the realm of science fiction writers such as Isaac Asimov, this fiction is now fact.

V2V technology, which was developed by Adelaide-based company Cohda Wireless, gives drivers a 360-degree awareness of surrounding vehicles by broadcasting information about a car's current position, speed and direction at a rate of 10 times per second. Australia has one of the highest road death toll rates in the world.

According to CEO Paul Gray, half of the cars involved in V2V trials around the world contain Cohda equipment. The company participated in a trial with the United States Department of Transportation National Highway Traffic Safety Administration (NHTSA) in February 2013.

The trial involved 2,800 vehicles, about 1500 of which had the Cohda device installed. In February 2014, NHTSA announced that it would start taking steps to allow the use of V2V communication technology for cars.

According to NHTSA research, safety applications using V2V could address a number of crashes involving two or more cars.

"With safety data such as speed and location flowing from nearby vehicles, cars can identity risks and provide drivers with warnings to avoid other vehicles in common crash types such as rear-end, lane change and intersection crashes. These safety apps have been demonstrated with everyday drivers under both real-world and controlled test conditions," read the report.

Gray said the major benefit of the NHTSA decision was "market clarity".

"The market will now switch from a trial phase to a deployment phase, a step change that enables Cohda to now engage earnestly with car makers."

"The key longer term benefits are twofold: Firstly, we now see production vehicles containing Cohda products hitting the road as early as 2016. Secondly, a mandate from the US government will see this rolled out to all new vehicles in a few short years after that."

Cohda CTO Paul Alexander said that he anticipates V2V technology will start appearing in cars in by 2017. Aa regulatory framework and infrastructure has to be agreed upon with Austroads, the Australian and New Zealand association of transport authorities, first.

"The current topics are really around what [V2V] standards exist globally and what Australia should consider going forward for our regulatory framework," Alexander said.

"From the infrastructure side, there are applications that can be deployed to meet safety and traveller information services. By deploying some infrastructure, it's quite possible to enhance the features sets that are available in the vehicles."

He added that there is one insurance company in Australia that has expressed interest in the V2V technology.

"The insurance company is inquisitive and want to understand what this system is so they can optimise their [insurance] offerings," he said.

One possible scenario is that drivers who have the V2V technology installed in their car may receive lower premiums from insurance companies.

In October 2013, a device called Insurance Box that monitors vehicle speeds was rolled out by insurance firms QBE and NIA Underwriting Agency in conjunction with insurance technology provider SSP.

Insurance Box uses an on-board telematics device and can be fitted to most cars manufactured after 2000. Telematics is the integrated use of telecommunications and informatics.

Ford and V2V

Ford US global driver assistance and active safety Mike Shulman confirmed that the car manufacturer is working on V2V technology for cars in the US and Europe. However, no production models that use V2V have been announced at this stage.

According to Shulman, car manufacturers will compete on the number and quality of the V2V-based applications that are offered in their vehicles.

Forecasting the future

Research firm Forrester has forecast the adoption of V2V communications. According to a July 2013 report called The Connected Car by US principal analyst Charles S.Golvin, V2V will include communicating between infrastructure such as traffic signals.

"Today, beyond telematics, vehicle communications to other devices are within the car such as Bluetooth and USB connections to smartphones for voice calling and audio streaming, or enabled via external devices such as E-ZPass toll dongle," he said in the report.

"New short-range protocols such as dedicated short-range communications [DSRC] enable vehicles to break this local firewall, exchange information with other vehicles and with infrastructure such as traffic lights."

According to Golvin, DSRC will capitalise on the car's rich array of sensors to reduce accidents and optimise traffic flow.

He also forecast that many different industries will change as result of V2V communications.

"Mobile operators, with a revenue model increasingly tied to data consumption, now see a class of devices coming to their network."

Golvin added that car makers such as Ford now see connectivity as a near-term "payoff" when selling cars.

"Richer in-vehicle experiences such as streaming audio services and dictated Twitter feeds enhance the driving experience and thereby improve brand purchase and the likelihood of repeat purchase," he said.

However, because of regulatory scrutiny and the slow pace of government authorities, local V2V will first extend beyond the car to commercial infrastructure such as parking lots and to toll booths.

"After extensive review and testing, these short-range conservations will begin to take place between vehicles, reducing collision risk and injuries while informing drivers of local change such as a suddenly flooded highway ahead. Finally, local transportation authorities will deploy short-range radios to enable communications between vehicles and transportation control."

At the 2013 CIO Summit, CIO of car insurance provider LV= Richard Warner told the delegation of over 140 CIOs that he believes technologies like above that avoid collisions or drive cars without human interaction will have a major impact on his industry.