CHICAGO -- AT&T is coming off a second quarter in which it added 1 million connected cars to its LTE network, an impressive feat for the carrier, but also for the automaker that's responsible for much of that growth.
AT&T Inc. (NYSE: T) currently has partnerships in place with several car manufacturers, including General Motors , Audi, Nissan, Ford, Volvo and Tesla, which make half of all the new connected cars in the US. GM automobiles account for 1 million of the carrier's 4.8 million total connected cars, according to Terry Inch, COO of Global Connected Consumer for GM's OnStar division. Half of those million are Chevys, he says. (See GM: 10 Car Models on Road With AT&T's LTE.)
Inch came to Chicago this week, bringing two of those Chevys -- brand-new Corvettes -- to show off the car's inclusion of Apple Inc. (Nasdaq: AAPL) CarPlay and Android Auto. Click on the image below for a few snaps of the beautiful cars and, yes, some food pics from the dinner that followed.
GM is making a big bet on 4G LTE connectivity in its vehicles, with the help of partners including AT&T, Apple and Google (Nasdaq: GOOG). In fact, Inch says it's "all in" on 4G with 30 of its 2015 model cars -- and all future 2016 models -- shipping with LTE in North America, LTE cars now selling in Europe and plans to launch in China soon.
GM teamed up with AT&T to add LTE, with 3G fallback, to its cars in February 2013 and officially launched last summer. Inch says that consumers are still getting comfortable with the technology, but they are opting to use it -- and asking for it. (See AT&T Ups the Stakes in Connected Cars.)
In the first 30 days, 70% of people change the SSID and password on the car, suggesting they plan to keep using it. Nearly all -- 99% -- chose to sign the privacy statement, which keeps the connection open for five years, two years after AT&T's three months or 3GB of free data expires, meaning they retain at least the free basic package which has OnStar, remote link and monthly vehicle health checks.
What hasn't yet been clear, however, is how they want to pay for that data. New car buyers can get it through OnStar or, if they're on an AT&T Mobile Share Value Plan, add the car to their data bucket for $10 per month and treat it as just another device on the plan. The problem with that, of course, is that it has the potential to hog all the data from the other smartphones and devices on the plan. (See AT&T Makes GM Cars a Data Plan Add-On.)
Inch admits that a connected car on a Family Share plan could eat up the entire data plan watching videos on one cross-country road trip (but jokes it'll be the most peaceful road trip any parent has ever taken). AT&T hasn't revealed numbers on the take-up of cars on its shared data plans, but notes that of the customers who purchased a data plan after the initial trial period was over, more than 50% chose 1 GB or higher data plans.
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Data plan or not, GM is seeing more interest in tying the smartphone to the car. The company's OnStar RemoteLink app saw 20 million transactions, or interactions with the app, in total for 2013, Inch says. Now, with four months still left in 2015, it's already at 60 million, at a rate of 10 million to 11 million transactions per month. Consumers use the app to remotely lock or unlock or even turn on the car, get directions and check the car diagnostics.
Inch said that GM will soon add its AtYourService services for hotels and couponing to the Link app. Via AtYourService, GM customers can locate a hotel and make dinner reservations directly from the app and can receive coupons based on their location, demographics or any other information they opted in to provide. Inch said he expects the number of interactions with the app to exponentially increase when this service is added.
"We are going from diagnostics to prognostics in a 4G world," Inch says. GM expects to realize $350 million of LTE-related profit improvement between now and 2018, ahead of 5G launches, which connected cars are helping to drive. (See 5G: What Is It & Why Does It Matter?)
— Sarah Thomas, , Editorial Operations Director, Light Reading