Car manufacturers have long been generating money through subscription over-the-air (OTA) software updates. But with 3G capabilities set to expire in 2022, things could get even more expensive for car owners.
OTA updates are a hot topic for vehicles owners who resent paying for new services. I reported earlier in the year about Mercedes-Benz introducing an OTA subscription update to the all-electric luxury salon Mercedes-Benz EQ to modify the rear-axle steering with a ten-degree steering angle.
Fast-forward to this week, Toyota has consumers up in arms by setting an end date to free subscriptions for key fob remote start capabilities. This functionality is now only available with a Remote Connect subscription. for many drivers. Via a corresponding mobile app, the key fob makes it possible for drivers to monitor, lock, or start their cars with their smartphones.
According to Toyota, vehicles with Premium Audio can trial the feature for the next three years, and with the newer Premium Audio up to 10 years. But otherwise, car owners will need to pay for a subscription to continue using the key fob’s remote start. It’s a price of either $8 a month or (currently) $80 a year. That’s a lot of money for something you’ve previously enjoyed for free.
You may own your car, but you don’t own its functionality
We may have purchased the car outright, but OTA updates and a subscription model mean we’re still at the behest of the services and updates that the company chooses to share with us. We own the car, but the company owns the software.
And we really should have learned from the pain of smart homes. IoT-connected homes have a graveyard of failures. A company goes bust or is acquired. It stops supporting older devices or updating the device’s software. A security problem forces the device out of operation. Or legislation is passed that updates the law (as in the state of Massachusetts, for example) regarding the right to repair your own devices. Or technology standards evolve faster than the IoT device.
Long term, the goal of car makers is to eliminate privately owned vehicles. Instead, we’ll pay for a subscription service for autonomous vehicles to pick us up and drive us where we need to go.
But until then, I have many questions about how OTAs will play out:
- Should IoT-connected services have a minimum lifespan of functionality after the sale of a car model ends?
- If we buy a car with certain software subscription features, should we be able to take this subscription to the next car we buy from the OEM?
- What happens if we sell it second-hand?
- Does the new owner have to pay again for the same software service?
- What rights do we have to the subscriptions we’ve paid for? (Very little, it seems.)
Pissed off by OTA updates? Wait until you have to deal with 3G sunsetting!
While many of our smartphones are embedded with 5G, you might not know that most cars still run on old-school 3G cellular networks. This will become a big problem in 2022 as telcos are moving on from 3G.
What does the end of 3G mean for the average consumer?
It’s going to affect ALOT of cars.
A lot of software runs on 3G in cars, including WiFi hotspots, smartphone app connectivity, voice assistants, in-nav traffic and location data, hands-free calling, emergency call, and remote lock/unlock functions.
Once telcos close down 3G, these features will no longer be available — unless the automakers upgrade.
And for some customers, it will come at a price.
For example, Tesla’s offering a modest fee of $200. Stellantis, home to brands like Chrysler, Dodge, Fiat, Jeep, and Opel, will offer a subscription of appropriate hardware in 2GB of data per month at $9.99, or unlimited data for $29.99 per month.
Overall, Stellantis is betting big on OTA updates, predicting annual revenue of approximately $4.5 billion in annual revenues by 2026 and $22.5 billion by 2030, generated by software-enabled product offerings and subscriptions.
Toyota is discontinuing Connected Services support for vehicle models made in 2019 or earlier. Perhaps in response to the customer complaints about the keyfob, they told The Drive they have also “enhanced” vehicles built before Nov. 12, 2018, to no longer require a subscription for the key fob’s remote start feature to function.
Yep, there’s proof that car makers can turn functionalities on and off at will.
We can expect the next year to get messy as car owners struggle to keep up with their right to access their current software and how and what will be available after 4G kicks in.
I suspect there will be many unhappy customers, and a lot of companies lining their pockets with money from subscriptions.
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