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Why automotive brands becoming 'software companies' will lead car owners down a dark path | Opinion

They say the path to hell is paved with good intentions, and I worry paid software in cars is one of them.

Remember when you walked into a store and bought a physical copy of software on a disk?

Nowadays you just download software online and, more often than not, pay a monthly subscription for it. It’s fast and convenient, and you never have to worry about updating it because there’s a system that does that automatically.

Now I’m not here to give you a nostalgia trip on how we should go back to the ‘good old days’ of paying once for software on a physical medium, just as I won’t pine for the days when a V8 produced 140kW, but there’s a dark side to software-as-a-service which I think will inevitably work its way into the world of cars, potentially changing the way we use and pay for cars as we know it, and not for the better.

This thought came to me as I was contemplating a life under Volkswagen’s recently revealed ‘New Auto’ roadmap. The brand has declared its transition to becoming a ‘software company’ and has earmarked “new revenue streams” it plans to source from the software side of its future electric vehicles.

‘New Auto’ will mean almost every VW Group vehicle (yes, including Skoda, Audi, Cupra and even Porsche) moving onto a single ‘SSP’ platform, and with this move will come a new in-car operating system the brand dubs E³ 2.0.

While the new platform will further reduce material cost and overheads for VW, the brand is particularly excited by the revenue potential from software. As VW’s software boss puts it: “The software stack 2.0 (E³ 2.0) will include a unified operating system for vehicles from all Group brands. Another key feature will be [SAE] Level 4 readiness, meaning that customers can hand over the steering fully to the car.

“By 2030, software – on the basis of automated driving – can become a major source of income in our industry.”

To be fair to 'New Auto', it presents some good 'revenue' ideas like driverless ride sharing for the autonomous era. To be fair to 'New Auto', it presents some good 'revenue' ideas like driverless ride sharing for the autonomous era.

Doesn’t sound so bad, right? After all, this model already exists in the car world, with Tesla offering its ‘Full Self Driving’ suite as an option on its cars, which it promises will continue to increase in price as the features are improved. Since its launch in 2018, FSD has moved from a $US3000 option to one which costs over $10,000.

One great thing about this is you don’t need to pay an extra $10k to enjoy most of a Tesla. What worries me about this model, though, is two things, one being having to pay for things that the car is actually capable of out of the box. It’s literally just a software lock.

This has me thinking what else could be software-locked in future electric cars, as manufacturers pursue “new revenue streams”. We’ve already seen BMW attempt to come after features which should absolutely be standard, like wireless Apple CarPlay. At one point the brand was charging an outrageous $479 for a three-year subscription to use a feature that the car’s hardware supported. Somewhat unsurprisingly, BMW removed the unpopular CarPlay subscription model in December 2019.

Imagine a world where you can pay for features you already paid for! Imagine a world where you can pay for features you already paid for!

What happens when manufacturers, as they become more software-oriented, start deciding to take inspiration from the ever-profitable microtransaction world? How would you feel about paying a one-off single-use $5 in-car fee to boost your electric car’s kW charging rate from 100 to 150, cutting your 80 per cent charge time down by an hour? Even though the car’s hardware has always supported 150kW?

BMW, again, has already toyed with ideas like this, flagging a concept of charging users for things like heated seats on a subscription basis back in 2020. Don’t want heated seats in summer? Don’t pay for them. Except you already paid for them when you bought the car…

GM has also experimented with similar concepts, unveiling in 2017 a service it called Market; “the automotive industry’s first commerce platform”. Built into the Chevrolet Equinox (which we knew as the slow-selling Holden Equinox), the platform was touted to offer drivers the convenience of being able to order and pre-pay for things like fuel and coffee through the car’s multimedia suite. I mean, you might save 20 seconds at your local fast-food drive-thru, but importantly it gives GM the opportunity to promote “sponsored deals” to you. I think I’ll trade those 20 seconds once in a blue moon to not have ads in my car, thanks.

Are we approaching peak capitalism when your car's multimedia system has "featured offers"? Are we approaching peak capitalism when your car's multimedia system has "featured offers"?

We can all pray that a patent once filed by Ford for pop-up ads on multimedia systems is never properly explored…

The other issue I have with this model is the particularly nasty practice – as seen elsewhere in the software industry – paying a subscription or lump sum (sometimes both) for an unfinished product. Literally being quality assurance tester and paying for the privilege. I feel as though CarsGuide deputy editor James Cleary has already covered the implications of this in his piece on Tesla’s full self-driving suite, which you can read here.