Car buyers ready to pay extra for Wi-Fi
AT&T and Ericsson, a communication technology and services company, have conducted their second annual global connected-car study. The data was gathered from customers likely to buy a car in the next three years in the U.S., Germany, Brazil, Mexico and China.
According to the study, “connectivity in cars” includes wireless Internet allowing certain apps — such as streaming music, navigation services with real-time traffic updates and restaurant services — to run from your dashboard.
In the study, Wi-Fi hot spot availability ranked as the No. 1 feature U.S. customers are willing to purchase for their car; also, U.S. consumers would prefer to add their wireless car-connectivity services to a shared data plan.
There are a few connectivity concerns we thought of, though:
- You might get the sense “Big Brother” is watching.
- This could be a huge driving distraction on the road.
- The software could become out of date rather quickly with the technology cycle always changing.
- Hacking is always a possibility.
Chris Penrose, senior vice president of the Internet of Things, AT&T Mobility, ensures consumers that the company has the customer’s best interest in mind. Penrose said that AT&T T, +0.65% plans to use the information it gathers from consumers for good, that there are rules and regulations put in place to keep drivers safe and that the old software will be easy to switch out with new software.
“We’re working to help make driving safer, more comfortable and more fun for both drivers and passengers. Our network is at your service, even on the road,” said Penrose.
AT&T projects that more than 10 million vehicles will be on its network by the end of 2017.
General Motors GM, +2.06% has been a key partner in AT&T’s success. In 2013, GM officially made AT&T its connection provider, and now more than a million vehicles in the U.S. and Canada have OnStar 4G LTE.
Greg Ross, director of business development and alliances at GM’s Global Connected Customer Experience, said that this is one of the first steps for car sharing and for autonomous driving.
AT&T hasn’t disclosed how much revenue will come out of any deals it has with auto makers but explained it makes money through wholesale relationships with auto makers that pay per connection, through monthly service plans with customers and through updates on software.
General Motors announced in April it expects to generate $350 million over the next three years from the OnStar 4G LTE deal. With AT&T having partnerships with eight other car makers, it’s a safe bet the company will be a big player in car connectivity in the coming years.
Source: Market Watch
