(Bloomberg ) General Motors Co. (GM), the largest U.S. automaker, said its OnStar unit will begin offering 4G LTE service in vehicles next year in a partnership with AT&T Inc. (T)
The faster mobile data speed will first be available in most 2015 model year vehicles in the U.S. and Canada, GM said today in an e-mailed statement. Additional markets and service providers will be announced in coming months, the company said.
"We're making a global commitment to embed 4G LTE mobile broadband across all of our vehicles," Mary Chan, president of GM's Global Connected Consumer, said in an interview. "This is the largest commercial deployment of 4G LTE services in the auto industry."
The move marks an evolution for GM's OnStar, which has 6 million subscribers in the U.S. and Canada for the in-car communication service. The Detroit-based automaker traditionally emphasized OnStar's operators while other automakers have developed programs that used onboard navigating systems with video screens or systems that piggybacked off of connections with smart phones.
GM's OnStar operator-emphasis strategy is changing with the introduction of new telematic systems in Cadillac and Chevrolet and today's announcement.
"This is a big deal," said Thilo Koslowski, an industry analyst with Gartner Inc. based in San Jose, California. "They want to actually have embedded connectivity in their connected vehicles rather than relying on a mobile phone going forward, that's a pretty big shift in terms of where other vehicle manufacturers are today."
Long-term evolution, or LTE, is a higher speed, fourth- generation wireless technology compared with third-generation, or 3G. AT&T, Verizon Communications Inc. (VZ), Sprint Nextel Corp. (S) and T-Mobile USA Inc. are adding LTE to their networks. LTE allows mobile users to load videos and stream music as much as 10 times faster than 3G, according to the statement.
With 4G, GM said it could include in-vehicle Wi-Fi hot spots, streaming videos and faster application downloads.
"This enables them to actually have the capabilities to support all kinds of innovative services and needs that consumers may evolve or may desire in the future by having this technology available," Koslowski said.
GM didn't disclose pricing details.
"There's going to be different tier levels of service that customers can choose and buy from," Chan said. The faster service won't be available for older vehicles, she said.
AT&T, the second-largest wireless carrier, said the OnStar agreement will boost prospects for the Dallas-based company.
"We think telematics will be a $1 billion business for AT&T," said Glenn Lurie, head of emerging businesses at AT&T Mobility. "Moving forward with GM and OnStar is a big step in that direction."