General Motors Co. expects its OnStar 4G LTE WiFi hotspot in cars could be worth $350 million in improved profits by 2018, as the company’s Chief Financial Officer Chuck Stevens called it an “untapped, under-appreciated” opportunity. Speaking at a Bank of America Merrill Lynch conference, Stevens called GM’s OnStar 4G LTE connection an “untapped, under-appreciated opportunity.”
“Based on our plans today, which are still in the early stages of really taking advantage of this technology, we expect to see $350 million of profit improvement between now and 2018 specific to 4G LTE, and in our view, that’s just the beginning,” Stevens said.
AT&T lets customers with an LTE-capable vehicle from GM and other auto makers to add the car as another device to their Mobile Share Value shared data plan for $10 per month, the same price as a tablet. So size doesn’t matter. It would be interesting to know how much data the car actually utilizes with all of the GM services activated. Add that to the 2.4 kids in the back seat chewing through hours of HD Netflix movies and you start to get the idea.
AT&T has activated 800,000 connected cars. The carrier expects to have at least 50 percent market share of new connected cars in 2015. Yet AT&T executives also have acknowledged that they need to clearly demonstrate and market understandable use cases to gain traction with consumers in the connected car market.
Who would have thought that tuning on Wifi in your car could be so profitable to the car manufacturer? Maybe this windfall should be set aside in a special fund for bailing out the car manufactures next time one goes into chapter eleven – it would save a bunch of tax payer money.