OnStar, General Motors' system that provides concierge service, roadside assistance and turn-by-turn navigation, is getting a major makeover.
GM on Sunday said it will cast OnStar as a provider of high-speed connectivity to vehicles, with a portfolio of infotainment features. The revised service will start this summer on some vehicles as a bundled package of infotainment apps.
Current safety and security features will still be available. In addition, OnStar will offer a Wi-Fi hot spot, streaming radio, vehicle diagnostics, weather reports and other apps via a high-speed 4G LTE data connection provided by partner AT&T.
"It will be introduced on everything from entry-level hatches to Silverados," said Tim Nixon, OnStar's chief technology officer, during a Dec. 11 presentation for journalists. "We want to make sure these connected features are brought to a broad customer base."
First will be the Chevrolet Corvette, Impala, Malibu and Volt, which will get 4G LTE this summer. Later this year, the Equinox, Silverado, Spark and Spark EV will get 4G LTE connectivity. Buick, GMC and Cadillac also will get this feature, although GM did not disclose a launch date for those brands.
Those nameplates will feature Wi-Fi connectivity for as many as seven mobile devices. Passengers could use that connectivity to download videos onto their tablets, view Facebook or surf the Internet. Car owners also will be able to download apps themselves from an online GM store without charge, but they'll pay a fee for connectivity.
Mary Chan, president of GM's global connected consumer unit, said late Sunday that GM would offer flexible pricing plans to its customers. For example, motorists might be allowed to use 4G LTE for a weekend trip or vacation -- in effect, ala carte pricing.
"We are certainly considering options like weekend plans for families," Chan said during Chevrolet's press conference Sunday at the CES show in Las Vegas. "We want to make it more flexible. Those are options that we are working on with AT&T."
In addition to that, GM car owners who also use AT&T as their wireless carrier will be allowed to add their vehicle to their monthly data plan -- as if it were just another device, like a tablet or cell phone.
Chan said GM will announce its pricing plans shortly before the launch of 4G LTE this summer.
The key to the new OnStar is 4G LTE, a data pipeline that Nixon said will be 10 times faster than the service's current 2G connectivity.
High-speed connectivity will be embedded in the vehicle, which means OnStar's apps won't depend on a smartphone's Bluetooth connection to the car. That ensures the vehicle's ability to transmit a motorist's call for help, a top priority for OnStar.
But embedded connectivity has other advantages. For instance, it will allow OnStar's apps to be displayed and used uniformly in all GM vehicles, regardless of the type of smartphone used by the motorist.
It also will allow GM to design easy-to-use console controls, which means older motorists will be more likely to sign up for the revised service.
"We'll have some drivers that may not be quite so tech-savvy," Nixon said. "We recognize that simpler is better."
OnStar's makeover was foreshadowed last year when GM CEO Dan Akerson announced a deal with AT&T to provide 4G LTE connectivity.
In May, Akerson told stock analysts that the AT&T deal "opened up what I think are potentially lucrative lines of business that don't exist" in OnStar at the time.
Those were bold words, since OnStar already is quite profitable. Analysts have estimated OnStar's annual sales at $1.5 billion, with a profit margin of 30 to 35 percent of revenue.
OnStar will use the vehicle's data -- which Nixon dubbed "a treasure trove" -- to create some of those business opportunities. For instance, auto insurers might offer discounts to motorists who agree to share car usage data such as vehicle speed and braking patterns.
Greg Ross, director of product strategy and infotainment in GM's global connected consumer unit, told Automotive News that GM is holding exploratory talks with several insurers.
"That's an example of the kinds of things we are trying to do" to reduce car ownership costs, Ross said. "We'll have an increasing range of services that illustrate why a connected car is a better car."
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