LAS VEGAS, Nov. 13 (UPI) -- Think of OnStar, and most people think of Batman swinging into the Batmobile and using the OnStar "hands free" calling service to get directions.
This is so-called "telematics" -- or the use of onboard vehicle communications and information services -- at its best.
But OnStar isn't just for the Batmen (or women) of the world, as the company on Monday announced that it would break the 2-million subscriber mark by the end of the year, after having started 2001 with around 700,000 customers.
Growing at a rate of an average 5,000 subscribers a day, this General Motors unit will have post a growth rate of 250 percent by the end of the year. It can boast of having an 85 percent market share in the in-vehicle services area that it, more or less, uniquely occupies.
"We are very satisfied with our subscriber rates, renewal rates and user response," said OnStar president Chet Huber at the Comdex technology trade show. "Our subscription-based business model continues to thrive by offering quality services drivers want and need in their vehicle on an easy-to use, flexible technology platform."
The Detroit chief executive officer is a regular at the large Comdex technology show -- said to be the largest in the world -- not as an exhibitor, but instead attending the sprawling event to network and build business relationships.
Given OnStar's rate of growth, Huber might well be asked whether the company has a "killer application" in terms of potential popularity. But call it what you might, for Huber what the company is selling is "safety, security and peace of mind."
"While we're excited about the technology and where it is going ... the core set of services that gives people the most reason to have this in their care is -- I'm connected while I'm driving, someone is with me 24 hours a day, there is a live person I can get to if, in fact, I have a problem," Huber said.
"That seems to be, by far, the broadest appeal," he added.
The basic suite of core services offered by OnStar includes such features as automatic airbag deployment notification, remote door unlock, remote engine diagnostics and stolen vehicle location; concierge services, information/convenience services and route support.
The current cost for the basic service is $16 per month.
According to Huber, the company has had 10 million interactions with subscribers since starting in 1996.
On a monthly basis, OnStar responds to 200,000 routing calls per month: 15,000 door unlocks each month; 14,250 roadside dispatches a month; 300 air-bag deployments per month; and 375 stolen vehicles located per month.
"The numbers are scaling up, and its really turning into a pretty big business," Huber said.
One of Huber's favorite stories of customer services comes from rural Montana where OnStar customers found a bear on the front porch of their cabin and called OnStar with the request that the company call animal control.
"We were able to get in touch with them (animal control) and have the bear -- at least temporarily -- moved off the front porch," Huber said.
This year, the company broadened its services to include a nationwide rollout of its "Personal Calling" service and "Virtual Adviser," a location-enabled voice portal designed for the driving environment.
Virtual Adviser, developed with General Magic Inc. gives subscribers access to personalized information in a hands-free, activated manner with no screens or displays
In particular, as part of the Virtual Adviser service, Huber said he expects personalized traffic advisories to be a big seller.
Content partnerships for the Virtual Adviser service include with Fidelity, CNN Radio Network, The Wall Street Journal, Disney and Tele Atlas/Metro Networks launch of XM Satellite Radio in select 2002 GM vehicles.
In addition to being featured in many GM models, OnStar can also be found on Lexus, Acura, Audi and Subaru vehicles.
Huber declines to state OnStar's recent revenues or net income -- citing competition concerns - but added that while the GM unit has not reached profitability because of the customer acquisition cost of building a entirely new network of services and offering, the company expects not only profitability but eventual revenue in the billions category.
"In the not too distant future, the revenue numbers will have Bs after them, this is a big opportunity." Huber said. "How big it gets will be a function, ultimately, of how big we can grow our subscriber base."
Huber added that customer acquisition cost has steadily declined as the company's investment cost in initial technology has lowered over time.
"We are on our fifth generation of hardware now and will launch our six generation of hardware in January, the benefit we have as we work with each iteration of electronics the cost continues to come down, the volume (customers) has continued to go up, so our acquisition cost have dropped pretty significantly," he said.
"There are real scale economies in this business," Huber added.
In the meanwhile -- while OnStar continues to pitch for more subscribers -- the company has Batman pulling for them in an ongoing advertising campaign, which Huber said has increased brand recognition by 90 percent.
