GM lowers 4G LTE Wi-Fi data prices
General Motors Co. said Wednesday it is lowering OnStar 4G LTE data plan prices for its U.S. vehicles by up to 50 percent, as customer use increases, which has lowered the cost of the technology.
The Detroit automaker began offering the service in vehicles, allowing up to seven devices to connect to the Wi-Fi hotspot, about two years ago. It has said the OnStar 4G LTE connections could be worth $350 million in profits by 2018, with the Internet connection creating new business opportunities.
New monthly pricing begins at $10 for 1 gigabyte of data, down from $20; a new 4GB plan is available for $20 a month; 10GB of data is now $40 a month, down from $80 and a new 20GB plan for $150 a year replaces a 10GB plan for the same price. Customers also can buy 250 megabytes of data for $5 a day.
The Detroit automaker said customers for its largest brand, Chevrolet, in two years have used more than 3 million gigabytes of data, or the equivalent of streaming more than 100 million hours of music or nearly 17 million hours of video.
“Wireless connectivity has proven to be a beneficial technology for many Chevrolet customers, from contractors who use their Silverado as a mobile office to families using their Suburban on a summer road trip,” Sandor Piszar, Chevrolet truck marketing director, said in a statement. “As our customers increase their usage of the technology, we are able to make it more affordable for them.”
The bow-tie brand has more than 2.1 million OnStar 4G LTE connected vehicles globally on the road. The company offers the connections across its portfolio of vehicles and brands including GMC, Buick and Cadillac, for a total of more than 3 million vehicles worldwide.
A GM spokesman said Chevrolet vehicles are experiencing increased data use. The carmaker generally offers new vehicle buyers and those leasing a 3 GB trial for three months. The company is not disclosing the number of customers who are paying for subscriptions after the trial, but a spokesman said the price reduction is not due to low demand.
Chevrolet says more than 60 percent of Suburban customers use the Wi-Fi hotspot in the trial and after, while Tahoe and Traverse SUV use rates come close. The carmaker has seen the high use among families, though it has seen the most use in the Silverado pickup, with customers using more than 1 million GBs.
Last year, GM said in early results, more than 20 percent large SUVs owners were buying subscriptions and truck owners were renewing 4G data at rates in the low-to-mid teens.
“As more people embrace the technology, it brings down the cost of entry for all users,” Laura Keck, OnStar subscriber marketing strategy manager, said in a statement. “With these lower prices, we expect even more customers to use 4G LTE connectivity during this busy summer driving season.”
IHS Automotive has estimated GM will have 1.9 million 4G LTE data subscribers in the U.S. by the end of 2018 and those data subscriptions could be worth $394 million in revenue to the company by 2018.
Data plans are offered to OnStar customers through AT&T. Details: https://www.onstar.com/us/en/4glte-subscriber.html.