There are positive and negative ramifications to this move

BMW is taking a page out of service-based pricing by turning a lot of traditional car options into software services that can be enabled (and disabled) at any point in them.

The German automaker made the announcement in a VR presentation that was streamed live from company headquarters in Germany. BMW tackled a series of digital updates to a lot of its models, but the most significant part of the presentation involved plans to turn a lot of its options into software services that that can be enabled through the new MY BMW app.

Subscription-based services are not a new deal with BMW, are they?

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BMW Takes Subscription Models Too Far, Wants You To Pay to Use Things Like Heated Seats and Safety Features
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No, they’re not. In fact, BMW has talked about this for a while. The basic gist of BMW’s planned subscription-based service is straightforward.

Suppose you bought a 3 Series with no options for heated seats and a heated steering wheel, you can retroactively avail those options through a subscription service. These options can be added manually (hardware subscriptions) or as updates (software subscriptions) through the new MY BMW app that all new BMW models will come with as standard. BMW can offer a free three-month trial and then you can basically buy a subscription for these features for a set amount of time.

What’s the difference between this new subscription tool and the Connected Drive Store that’s been operational since 2014?

BMW Takes Subscription Models Too Far, Wants You To Pay to Use Things Like Heated Seats and Safety Features
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The Connected Drive Store that BMW launched in 2014 allowed car owners to book or avail digital services, but more often than not, those features were directly tied to the car’s infotainment features.

This new subscription-based service goes beyond that, turning vehicle functions and optional equipment into on-demand services that can be available over the air.

Safety features like active cruise control with stop-and-go functionality or a high beam assistant can be availed after-the-fact for a set period or until you have no use for them, in which case you can unsubscribe the service.

This is a good thing, right?

BMW Takes Subscription Models Too Far, Wants You To Pay to Use Things Like Heated Seats and Safety Features
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It’s a good thing in the sense that you don’t have to pay for heated seats in the summer when they’re basically useless. Those who lease their BMWs - a significant part of the car-buying population in the US — won’t have to spend for features that they have no use for, saving them some money in the process.

At the same time, consumers can cherry-pick the specifications they want from their BMWs without having to buy bloated bundles and packages that include options they don’t have any use for. In this sense, service-based subscriptions could potentially save buyers or leasers a lot of money.

What’s the downside to BMW’s service-based pricing?

BMW Takes Subscription Models Too Far, Wants You To Pay to Use Things Like Heated Seats and Safety Features
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For all of the perceived benefits that this will bring to car buyers, there are some potential downsides to it, too, especially when it comes to used car sales.

If you’re buying a used BMW and you have to spend more to avail of features and services that have been discontinued in those cars, that’s a hit to the wallet that you probably don’t want. If money isn’t an issue, then you can have a better-equipped BMW than the previous owner of the car.

You’ll just have to pay extra for that distinction. It’s not hard to make the financial connection, especially when you look at it from BMW’s perspective.

It can tout the “vehicle-as-a-platform” approach as much as it wants — other automakers will probably do the same — but it’s clear that this approach, while popular these days, has revenue stream written all over it.
BMW Takes Subscription Models Too Far, Wants You To Pay to Use Things Like Heated Seats and Safety Features
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This is another source of revenue that BMW, and other automakers, can take advantage of. Whether it becomes an actual thing that’s sustainable will be determined by how hard BMW pushes to make it happen.

Is it going too far when you have to subscribe to safety features that you should probably get as standard on your models in the first place? Perhaps it is, but service-based pricing is the rage these days, and it seems that the auto industry is itching to jump in that bandwagon, for better or worse.

Kirby Garlitos
Automotive Aftermarket Expert - kirby@topspeed.com
Kirby’s first exposure into the world of automobiles happened when he caught Knight Rider on television as a five-year old boy. David Hasselhoff didn’t leave much of an impression on him (that happened later on in Baywatch), but KITT certainly did. To this day, Kirby remains convinced that he will one day own a car with the same ‘spirit’ as the original KITT (not the 2008 monstrosity). He doesn't know when that will be, but until then, he’s committed to expressing his love for KITT, and all cars for that matter, here at TopSpeed.  Read More
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