Change is coming swiftly for Chet Huber, managing director of General Motors' OnStar unit.
In the last three months, GM has given Huber, 45, a new boss - e-GM President Mark Hogan - and a new goal: boost OnStar subscriptions to 1 million by the end of 2000, up from about 100,000 currently.
Last week Huber got a new partner when GM agreed to pay $15 million for a minority share of General Magic Inc. The Sunnyvale, Calif., company will provide the base technology for OnStar's upcoming Virtual Advisor.
Virtual Advisor, to be released sometime next year, will allow OnStar subscribers to access information such as e-mail, sports scores, stock reports and news via voice interaction.
Huber says more partnerships are coming as GM seeks technology it can easily plug into OnStar.
'Our whole notion here is to put as little technology in the vehicle as we have to,' Huber said. 'The power of what we can deliver to that thin device in the vehicle is really what you do in the network and on the service side.'
Staff Reporter Joe Miller interviewed Huber Nov. 2 at the Specialty Equipment Market Association convention in Las Vegas. The following are edited excerpts:
If you have 1 million subscribers by the end of 2000, won't you have to get rid of the human operators and automate the system?
Actually not. We know a lot about the patterns of usage for OnStar. We know how they vary from days of the week, from times of the day. We have a pretty good handle on how this business needs to scale as we take on additional subscribers and what services require a lot of (human) adviser time. So if you need it, it will be available to you in the case of a safety or security situation.
We will be scaling the OnStar infrastructure and opening new OnStar centers as the subscriber base grows.
Will OnStar always be a GM exclusive?
I would expect not. I would go as far as to say I hope not. We have talked to a number of other (automakers), and would love to think OnStar services are valued services that would be delivered to any number of vehicle platforms.
How has the creation of e-GM in August affected OnStar?
We're on the same mission we were on before. OnStar is very focused on developing and delivering communications and information technologies in vehicles and making that a large business segment.
What it does is really give us an opportunity through our relationship with e-GM and Mark Hogan to make sure we're coordinating and leveraging to the greatest extent possible the technologies and the relationships (developed by e-GM and OnStar).
When will OnStar be a profitable business for GM?
A lot of that will depend on how aggressively we roll out the business. If you aggressively grow your business and bring on hundreds of thousands or even millions of subscribers, then you will be investing in the building of that subscriber base.
As that base reaches a critical size, and your growth in proportion to that allows you to generate positive cash flows, then you become profitable. Since day one, we've had an objective to becoming a profitable business. We're still on that path.