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Volvo: AT&T HSPA+ Can Drive My Car

AT&T is quickly becoming the carmakers' connectivity provider of choice. The carrier said on Wednesday it has added another carmaker, Volvo, to its roster of connected car partners.

The two have signed a multi-year agreement that will see Volvo embed AT&T Inc. (NYSE: T) HSPA+ connectivity in new Volvos in the US and Canada via its Single SIM platform. AT&T will power Sensus Connect, Volvo's embedded infotainment service built with Ericsson AB (Nasdaq: ERIC), as well as Volvo On Call for remote access to car functions and emergency crash notifications.

Volvo didn't say how it will charge for the connectivity, but its Sensus Connect service has traditionally been offered free for 12 months with a new Volvo, followed by a subscription fee. The pair expects cars with the embedded wireless to be available this summer.

Why this matters
The connected car arena is becoming a hotly contested space for telematics, and AT&T is emerging as a front-runner. It also has a deal in place with Audi, GM, and Tesla and recently opened a dedicated facility for carmakers to explore the possibilities with connectivity.

The question it's working to answer now is how much consumers will pay for connectivity in the car. The carrier is testing a subscription model with Audi, but recent Heavy Reading research suggests consumers are reluctant to pay more money for connectivity on the road. (See Finding the Value in Transportation Telematics.)

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— Sarah Reedy, Senior Editor, Light Reading

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DHagar 4/17/2014 | 12:31:35 PM
Volvo: AT&T HSPA+ Can Drive My Car @sam masud, you are probably right about that.  The rest of us will be using the more universal connectivity with smartphones, devices, etc.  That's what is going to be interesting to see how they price and what the demand truly is.
sam masud 4/17/2014 | 10:49:11 AM
Re: Volvo: AT&T HSPA+ Can Drive My Car This is really for the 1 percent--with a lot of folks struggling to just put gas in their cars.
DHagar 4/16/2014 | 9:16:15 PM
Volvo: AT&T HSPA+ Can Drive My Car @danielcawrey, maybe you have hit on a new business model for them? 

You are right, they always find ways to add features.  I think they would really like this, if they can expand on the Onstar system to create recurring revenues for connectivity - that goes beyond features!

But I am with Mitch and Sarah, if people don't want connectivity and/or to pay for it, it will not matter what they come up with.

The issue will also be, as I see it, will people connect through their cars and/or have connectivity through other devices/connections and avoid the car connectivity fees?

AT&T is certainly selecting high-value customers and the right car companies for that, so maybe they are segmenting their markets?
danielcawrey 4/16/2014 | 5:29:21 PM
Re: LTE v HSPA+ Car companies are always looking at add new options to vehicles... it is an easy moneymaker for them. Just look at GM's OnStar product, which has helped the company make money while their cars were not very good a few years ago.

Sure, they had to go bankrupt and make better vehicles to ultimately survive... but there's still OnStar. Rivals are looking to compete with similar products. 
Sarah Thomas 4/16/2014 | 5:14:01 PM
Re: LTE v HSPA+ They didn't cite any studies to support that consumers want a connected car and/or want to pay for it. I'll be very curious to hear their take-up numbers. Maybe they'll divulge some for Audi on future earnings call.

Personally, I don't want a connected car...but I don't even want a car, so that probably doesn't help with hard evidence.
Mitch Wagner 4/16/2014 | 4:49:09 PM
Re: LTE v HSPA+ Sarah, what kind of demand do we see from consumers for connected cars? Is there hard evidence?
sam masud 4/16/2014 | 2:20:46 PM
Dandy Will soon be able to watch Wolf of Wall St. streamed by Netflix while wearing Google Glass. Now that's multi-tasking. Of course, might have to buy a Volvo first.

Wonder what this will do to auto insurance rates....

 

 

 
Sarah Thomas 4/16/2014 | 12:04:57 PM
LTE v HSPA+ So this is an HSPA+ deal, but Audi is using AT&T LTE. I wonder how they decide which network is needed in the care. Is it just a price decision, or does what AT&T is powering in Audi really require LTE while Volvo doesn't?
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