You may have heard about BMW's move to charge monthly subscription fees for some common features like heated seats. It seems the entire world has heard since Motor1.com broke the news about an $18 monthly charge for warm seats in South Korea. BMW apparently heard as well, prompting the automaker to release a statement clarifying its subscription service known as BMW Functions on Demand.
The primary takeaway is that, at least in the United States, BMW won't charge a subscription for options already selected and paid for by the purchaser. In simple terms, if you buy a new BMW X3 or any Bimmer with heated seats either as standard equipment or a paid-for option, it's a done deal. No monthly subscription is required to use, and that goes for subsequent owners who buy the car secondhand. If the feature is included or added as an option, it's always available for the life of the car.
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In its statement, BMW explains that Functions on Demand works with software-based features using hardware already installed in the vehicle. It allows buyers to sample a feature before deciding if they want it, presumably saving a bit of cash on the purchase price. As an example, BMW highlights a dash cam feature currently available through Functions on Demand in the US, using cameras already installed for advanced driver-assist systems. The automaker also relegates remote start to Functions on Demand, requiring either a subscription or a purchase to activate it.
If the hardware is already in place, why place functionality of the features behind a paywall for use? In such a regard, the user is paying for the software to use it. For now, only these two features are offered through Functions on Demand in the US market. But as we saw with BMW's heated seat feature in South Korea, not all markets are equal.
Here is BMW's full statement regarding subscriptions and its Functions on Demand system:
As premium vehicle purchasers, BMW customers in the USA demand a high level of equipment in their vehicles. Options like heated seats are ordered on over 90 percent of the BMW’s sold in the USA. BMW of North America does not expect factory option purchase levels to change significantly going forward. BMW Functions on Demand on the other hand is designed to offer premium features through software upload that use data and sensors from factory option hardware already built into BMW vehicles.
As an example, some BMW models equipped with certain specific options from the factory can currently add the first two Functions on Demand features available in the US – namely a dash cam function called BMW Drive Recorder and BMW Remote Engine Start function—through a software download in a customer’s vehicle. The BMW Drive Recorder feature uses the cameras needed for advanced driver assist systems for dash cam functionality.
This gives customers the possibility of adding new software based functionality and a degree of flexibility in that they will be able to test, and then decide whether or not to purchase a vehicle feature that was not initially available at the time of the original vehicle purchase.
With BMW Functions on Demand, customers will be able to explore new software based features on a short-term basis by purchasing a trial, or buying that feature outright for a period of time or for the life of the vehicle. It is important to note that BMW Functions on Demand is intended primarily as a digital aftersales solution and will not affect options that were ordered at the time of the vehicle purchase. For example, if a vehicle is initially ordered with heated seats, that option will not go away nor be subjected to a monthly fee.
Please note that BMW Functions on Demand and the possibility to test or purchase select options after the point of purchase is part of a global aftersales strategy that BMW has introduced in various markets around the world, including on a small-scale basis in the US. The features that are available in this digital aftermarket will vary from market-to-market. Customers can browse available features in their local ConnectedDrive store online.
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Source: BMW via BMW Blog