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AI/Automation

Volkswagen completes pivot from AT&T to T-Mobile and Verizon

After years of working on the offering, Volkswagen of America announced the imminent availability of its new connected car platform. Importantly, Verizon and T-Mobile are supporting the offering but AT&T, Volkswagen's longtime connected car partner, is not.

The announcement helps to highlight the growing market for connected car services – which range from remote unlocking to full-blown in-vehicle Wi-Fi access – as well as the heated competition among network operators for that business.

But Volkswagen's newly updated connected car offering also opens the door to another noteworthy development in the space: Customers' ability to select from among multiple providers.

"Volkswagen is the first automaker partnering with both Verizon and T-Mobile to offer customers the flexibility to choose from multiple wireless providers," the company said in its release. Specifically, Volkswagen said customers can sign up for unlimited in-car Wi-Fi connections for an additional $20 per month by adding their car to their existing service account with either T-Mobile or Verizon.

Longtime connected car analyst Roger Lanctot, with Strategy Analytics, wrote that Volkswagen's support of multiple network operators could set a precedent.

"The announcement opens a new chapter in vehicle connectivity – one in which consumers can tap a re-provisionable connectivity device in a connected car in order to simply add their car to their existing wireless plan," he wrote in 2019, shortly after Volkswagen first announced its plans. "The new connectivity means cars may actually come to be seen by consumers as smartphones on wheels."

Volkswagen also offers additional connected car services, ranging from $8 to $49 per year, for services such as streaming radio and navigation capabilities. Such services require an active cellular data plan but cost extra.

Shifting from AT&T

Volkswagen's teaming with T-Mobile and Verizon comes just days after General Motors said it plans to connect millions of its cars in the US to AT&T's 5G network in the years to come.

Volkswagen in the US has been offering its Car-Net connected car services since around 2014, in part via AT&T's network. However, the company is now beginning to warn some customers that their services may no longer be available due to AT&T's 3G network shutdown plans. "All Volkswagen Car-Net connected services will no longer be available following AT&T's 3G turndown because of the AT&T SIM used in the model year 2014-2019 vehicles," the company warned.

Lanctot noted that Volkswagen's move from AT&T and to Verizon and T-Mobile signaled "something of a poke at AT&T." But AT&T may be added to Volkswagen's list of providers at a later date, he added.

More broadly, the ability for mobile customers to easily switch among providers is a trend that could stretch into a variety of different areas and devices. For example, T-Mobile is leveraging eSIM technology to allow prospective smartphone customers to test out its network from their existing devices. Customers of other network operators need only download an app in order to access T-Mobile's network. Although the operator has described its "test drive" service as a pilot program, it nonetheless hints at a future where mobile subscribers can easily flit among network operators, rather than having to purchase a new device or fuss with SIM card swaps.

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Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano

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