The clueless Apple punditry is getting it wrong yet again. As they’ve all enjoyed throwing stones at how ridiculous it is for BMW to charge $18 per month to have heated seats, they ignore their own hypocrisy at encouraging people to accept subscriptions when it comes to iOS apps.
But the problem is, having subscriptions for hardware on your vehicle actually makes a lot more sense than paying a subscription for a piece of software on your iPhone with almost no incremental distribution costs.
Everybody mocking BMW’s new subscription fails to mention that heated seats cost $500 up front under the old paradigm of purchasing the hardware with the car. So a $415 dollar lifetime subscription is actually a price cut. BMW deserves a pat on the back, not cheap shots. But that isn’t even the good part.
The real genius of switching to a subscription for heated seats is for the future used car buyers. When purchasing a used car, you don’t have the luxury of optioning out a car the way you want it. So it can sometimes be difficult to find cars with the right mix of equipment. If the previous owner skipped heated seats because he thought they were dumb, then every owner in the future has to live with his decision.
Or maybe you purchase a BMW while living in southern Texas and decide that you don’t need heated seats. You might regret that decision if you move to Cleveland Ohio for a new job. What are you going to do? Sell your car to get heated seats? It would sure be nice to hit a button and make that $415 purchase for a lifetime subscription. And a lot cheaper than trading in your car. Or how about just paying for a 1 year subscription if you plan to move back down south? Nice.
Subscription fees for BMW hardware options actually make a lot of sense for both the consumer and for BMW. BMW gets to sell heated seats multiple times over if everything works according to plan. They could feasibly sell to the new owner and sell them again to the 2nd or 3rd buyer down the line. With one installation! This offsets the immediate upfront cost of installing heated seats in all of their cars.
Everybody wins with heated seat subscriptions, new car buyers get a price cut, used car buyers don’t have to search for their special unicorn, and BMW presumably makes more profit. Stimulating increased volume growth is what makes it all possible. The initial car purchaser is no longer the bottleneck.
Now contrast that with subscriptions for iOS apps that you purchase on your iPhone. Software subscriptions are almost always more expensive to the consumer. That’s why iOS AppStore subscriptions are universally reviled. But with BMW, it’s cheaper for the consumer to do a subscription because BMW gets to “re-sell” the hardware.
Tech blogs mocking BMW are doing their readers a disservice by not thinking through the logical financial ramifications for the consumer. Because it’s all positive. Unlike spending a monthly subscription fee for an iOS calendar app. Now THAT’S ridiculous.
Everybody mocking BMW’s new subscription fails to mention that heated seats cost $500 up front under the old paradigm of purchasing the hardware with the car. So a $415 dollar lifetime subscription is actually a price cut. BMW deserves a pat on the back, not cheap shots. But that isn’t even the good part.
The real genius of switching to a subscription for heated seats is for the future used car buyers. When purchasing a used car, you don’t have the luxury of optioning out a car the way you want it. So it can sometimes be difficult to find cars with the right mix of equipment. If the previous owner skipped heated seats because he thought they were dumb, then every owner in the future has to live with his decision.
Or maybe you purchase a BMW while living in southern Texas and decide that you don’t need heated seats. You might regret that decision if you move to Cleveland Ohio for a new job. What are you going to do? Sell your car to get heated seats? It would sure be nice to hit a button and make that $415 purchase for a lifetime subscription. And a lot cheaper than trading in your car. Or how about just paying for a 1 year subscription if you plan to move back down south? Nice.
Subscription fees for BMW hardware options actually make a lot of sense for both the consumer and for BMW. BMW gets to sell heated seats multiple times over if everything works according to plan. They could feasibly sell to the new owner and sell them again to the 2nd or 3rd buyer down the line. With one installation! This offsets the immediate upfront cost of installing heated seats in all of their cars.
Everybody wins with heated seat subscriptions, new car buyers get a price cut, used car buyers don’t have to search for their special unicorn, and BMW presumably makes more profit. Stimulating increased volume growth is what makes it all possible. The initial car purchaser is no longer the bottleneck.
Now contrast that with subscriptions for iOS apps that you purchase on your iPhone. Software subscriptions are almost always more expensive to the consumer. That’s why iOS AppStore subscriptions are universally reviled. But with BMW, it’s cheaper for the consumer to do a subscription because BMW gets to “re-sell” the hardware.
Tech blogs mocking BMW are doing their readers a disservice by not thinking through the logical financial ramifications for the consumer. Because it’s all positive. Unlike spending a monthly subscription fee for an iOS calendar app. Now THAT’S ridiculous.
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