Prior to today, existing vehicle hotspot plans for consumers did not look too appetizing with high fees for a relatively low amount of data. In a recently published report, Strategy Analytics surveyed consumers to gauge their level of interest and willingness to pay for in-vehicle Wi-Fi. Interest in a vehicle hotspot was high, but willingness to pay was low for price points that were available at the time.
But now GM has drastically changed the value proposition, providing unlimited data for $20/month. As an added bonus, there is no commitment as consumers can add or drop coverage as they wish. This is a steep departure from their previous plans which were $40/month for 10GB of data and $10/month for 1GB.
Since key use cases for in-vehicle hotspots tend to require large quantities of data (e.g. video streaming for rear-seat entertainment), providing unlimited data at a reasonable cost is key for widespread consumer adoption. Not only is GM providing unlimited data, but it is doing so at a fraction of the cost of major carriers. AT&T (OnStar’s network provider) charges $60 at minimum for the first line, while T-Mobile charges $95, and Verizon (after much pressure) unveiled an unlimited offering for $80/month. Even more impressive is that GM’s cost for the package is lower than the cost for adding an additional line for each of those carriers. Instead, it is more in line with the cost of adding an accessory such as a wearable.
The only catch is that potential GM subscribers must also be OnStar subscribers to take advantage of the offer, which increases the real cost (for those that would not normally subscribe to an OnStar plan) to almost $40/month. Despite the catch, this cost is still in line with what carriers charge consumers to add an additional line to their plan.
So for consumers, particularly families without unlimited data plans on their smartphone, the appeal of unlimited data for $20 will be strong. It could also be the change needed to drive broader adoption of in-car Wi-Fi subscriptions, and increase the number of connected cars on the road.