Hyunda-Sonata-Review-AH-2

Android Headliner: Carriers Growth is Connected Cars & IoT

July 25, 2015 - Written By Alexander Maxham

Most of you probably know that this week was earnings week. We heard how well or not so well a number of companies did, including Verizon and AT&T. While covering AT&T’s numbers from the second quarter, something caught my eye, and that was the number of connected cars they added. While the company added 2.1 million devices in the quarter, 1 million of that was connected cars. In the first quarter, that was around 600,000. So are people really adding their car to their mobile share plan on AT&T? Here’s where things get a bit weird. You may remember that AT&T and Chevy have that deal where all OnStar cars come with AT&T’s 4G LTE. So everyone that subscribes to OnStar gets 4G LTE from AT&T. Basically, this means that 1 million OnStar subscribers bought a car this quarter, that has AT&T’s 4G LTE connectivity. However, Chevy isn’t the only one with a deal with AT&T. Audi, Buick, Cadillac, GMC and Volvo, while that’s not all the auto makers out there, that’s still a big number of them.

So now, why’s that important? Well for a couple of reasons. As many of us know, and have seen over the past few years, growth for mobile carriers is no longer in smartphones. It’s in tablets and other connected devices. We’ve seen AT&T and Verizon start to really push tablets, and Verizon added a ton of them this quarter. But the real growth is in connected cars. Imagine getting in the car and using your car as a hotspot for your phone? Pretty cool right? What’s even more important is that AT&T have struck an exclusive deal with Chevy (the details on how long this exclusive is for, are unclear however), so that every Chevy vehicle with OnStar has 4G LTE.

That’s a big win for AT&T. Because those are customers coming over to AT&T, when buying a new car. Whether they are already AT&T customers or not, that’s 1 million new devices on their network. What’s great about having a connected car, is that you are able to play music from Spotify, Pandora, Google Play Music and a number of other services, without using your phone. Which for some is a big convenience factor.

This all goes back to the Internet of Things, and everything being connected. Many car makers already have apps that you can use on your phone to lock/unlock, etc., with your car no matter where you are in the world. Having a connected car is going to make things pretty interesting. And the carriers need to realize this, as AT&T clearly has. However, when it comes to connected cars, I would rather see a car support all four carriers – much like the Nexus 6 does – rather than exclusives. What I mean is that you shouldn’t have to choose your car based on your carrier. Similar to what we used to have to do a few years ago with smartphones.

If these carriers want to continue to rake in the cash and add even more subscribers, they’ll need to look at things like connected cars, connected cameras and other IoT items. AT&T has been quietly adding a ton of cars and other connected devices to their networks, it’s time the others did so too. So we aren’t all stuck with just one choice for a connected car.