Would you pay yearly for Apple CarPlay?
On the face of it, BMW's recent decision is difficult to digest - but what sort of precedent does this set, and is it really that bad?
BMW recently announced they will be charging £85 a year for Apple CarPlay in all their vehicles fitted with software version 7 or later. So, the question is, would you be willing to pay yearly for access to Apple CarPlay? I’d hazard a guess to say on the face of it, the answer would be no… but before we come to a final conclusion, let’s look in to this a little further.
BMW have reportedly said this is so they can keep costs of their vehicles down. Now I’m sure that’s a statement most of us will struggle to digest, especially when you realise customers can get a Kia Ceed that costs less than £20,000 with Apple CarPlay at no extra cost. However, previously with BMW you had pay for the ‘professional nav’ to get access to Apple CarPlay. Negating this cost, over the course of a 3-year loan deal, the packaged yearly cost actually works out cheaper. Fine, but why should you pay for the privilege of CarPlay in the first place?
Let's remove Apple CarPlay from the argument, and speak theoretically, because I appreciate in silo the CarPlay move might be tricky to digest. As technology becomes ever more important in a car, on a par (and to some possibly more important) to hardware, it’s only natural manufacturers will want to, possibly need to take advantage of this and use it as a source of revenue. We’re already accustom to paying extra for ‘better spec’ models at point of purchase, whether that’s trim, technology, paint, wheels and more.
So, the question is, would you rather your car has built in functionality for something like Apple CarPlay, TV etc. and have the opportunity to pay monthly/yearly for it or make the decision to pay for this functionality at point of purchase?
From a technology stand point, if your car has the same functionality across all models, why shouldn't you pay yearly for added functionality? Technology is now more important than ever, and it doesn’t stand still. If you buy a car, 6 months down the line, new tech is likely to be out that makes your 'new' car outdated. Due to the fast moving nature of technology, doesn't a subscription based model work better than having to choose at point of sale? It’s in some way comparable to choosing between an iPhone XR, XS or XS Plus, depending on what level of hardware you’d like, then paying your mobile phone provider for access to online services.
It’s worth noting BMW already have this option – take a look at their ‘connected services’ packages. However, and it’s a big but, a lot of these services are either asking you to pay for things you can get for free elsewhere or are a ‘nice to have’. If this is to work, these monthly/yearly services must be value add to the driver. As they stand – I’m not sure they’re enough to make customers pay the money for them, but this Apple CarPlay move might just be enough to begin the shift to where this becomes acceptable.
Manufacturers are clearly testing out new ways to source revenue, and with multiple options there is a worry this could all become very complicated and fragmented, but until we see a clear defined direction, I think we'll see much more of this. It remains to be seen what that best direction is.
So, a few questions:
Due to the fast moving nature of technology, does a subscription based payment model work better than traditionally paying at point of sale?
With what I've mentioned in mind, what technology would need to be included in a package to make it worthwhile you paying monthly for it?