A major automaker is selling subscriptions for several add-on features in certain countries. Could this be the beginning of microtransactions for the auto industry?
What Happened: BMW BMWYY is launching subscriptions for several services including heated seats that come with new monthly fees along with the normal cost of vehicle ownership.
A report from The Verge highlights that heating front seats in BMW vehicles could cost $18 a month or $180 a year with an annual plan. Users could also opt for a three-year plan at $300 or unlimited access for $415.
The report says subscriptions have been tested for BMW since 2020. Heated seats as a subscription is listed as an option in countries like the United Kingdom, Germany, New Zealand and South Africa. The feature is not yet available as an option in the U.S.
Other features that include fees on a monthly basis for subscription include driving assistant, maps, safety cameras and high beams.
BMW announced in 2020 that its operating system would allow for microtransactions.
Why It’s Important: The auto industry is seeing many changes with a shift to electric vehicles and the higher cost of gas for consumers. Adding in microtransactions to the total cost of ownership could come across as greedy from a company like BMW.
Heated seats are available in the cars, but instead of being offered standard, a software block is placed on the feature that is only removed when it is paid for, according to the report.
When customers purchase new vehicles, they are already presented numerous add-on packages and features that come with additional fees.
Microtransactions are commonly used in the video game industry and have been a way for video game companies to get additional revenue from their loyal players. In the case of games, some companies including many mobile gaming companies released their games for free and then make up their money by charging for in game items.
Unless the cost of vehicles go down upfront and the subscription offerings come later, BMW and others will likely face pushback and the risk of customers going elsewhere.
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