- Vehicle Tech
- Hybrid & Electric Vehicles
Micro-transactions aren't going away anytime soon
When you purchase through links on our site, we may earn an affiliate commission. Here’s how it works.
(Image credit: BMW)
- Copy link
- X
- Threads
Sign up for breaking news, reviews, opinion, top tech deals, and more.
Contact me with news and offers from other Future brands Receive email from us on behalf of our trusted partners or sponsors By submitting your information you agree to the Terms & Conditions and Privacy Policy and are aged 16 or over.You are now subscribed
Your newsletter sign-up was successful
An account already exists for this email address, please log in. Subscribe to our newsletter- Charging for access to heated seats didn't go down well
- BMW admits it was a mistake but continues to explore subscription models
- More companies are turning towards micro-transactions to boost profits
BMW sparked controversy in 2022 when it floated the idea of a new ‘Functions on Demand’ program, which would charge owners to gain access to preinstalled hardware. In particular, the idea that owners would have to pay a monthly fee to access heated seats raised more than a few eyebrows.
The German marque was quick to clarify at the time that, should a customer specify heated seats, they would "remain fully operational for the life of the vehicle". But the company said that additional features, such as using existing camera hardware as a dash cam, would still be offered as a premium software subscription.
More recently, BMW head of product communications Alexandra Landers told drive.com.au that introducing the 'on-demand' service with a heated seat and steering wheel subscription model was “probably not the best way to start with it”.
You may like-
Apple's rumored 'Health+' subscription tier with AI features is doomed to repeat Garmin's failure
-
Pixel arrays, matrix headlights, OLED taillights: new lighting tech is bedazzling EVs
-
Tesla could soon bring CarPlay to its vehicles in a surprise U-turn – and many owners are happy
However, Landers also defended the model, stating "you have cloud use, and that is cost" and added that "if you use it, we have to pay for it". She also confirmed that the company is still exploring the idea that customers may want to unlock additional features for a fee in the future.
The upcoming iX3, for example, will be available with a subscription to the 360-degree camera, as well the company’s Tesla FSD-rivaling Driving Assistant Pro package, which offers advanced cruise control with automatic lane changing and more.
“With these established digital offerings, we offer our customers even more comfort and flexibility in line with their individual wishes after they purchase a vehicle,” a BMW spokesperson told The Drive when asked to clarify its standing on the matter.
But BMW is not the only manufacturer to come under fire for offering additional capability as a subscription service.
Get daily insight, inspiration and deals in your inboxContact me with news and offers from other Future brandsReceive email from us on behalf of our trusted partners or sponsorsBy submitting your information you agree to the Terms & Conditions and Privacy Policy and are aged 16 or over.Tesla recently removed the ability to pay a one-off fee for its Full Self-Driving autonomous driving system, while General Motors has been charging a fee for its OnStar emergency services for decades.
What's more, any 'constantly-connected' car requires payment for a data package eventually, otherwise owners have to be within reach of Wi-Fi to make the simplest software updates.
Like and subscribe
While many consumers are happy to pay a subscription fee for digital services, which are becoming an increasingly common sight in today’s Software Defined Vehicles, the real outrage came when BMW suggested that owners would have to pay for hardware that is already installed in a vehicle.
You may like-
Apple's rumored 'Health+' subscription tier with AI features is doomed to repeat Garmin's failure
-
Pixel arrays, matrix headlights, OLED taillights: new lighting tech is bedazzling EVs
-
Tesla could soon bring CarPlay to its vehicles in a surprise U-turn – and many owners are happy
The German marque did backtrack on that decision, but it continues to demand a recurring fee should the owner want to operate their heated seats and steering wheel remotely. The company argues that there are associated costs with cellular data and Cloud storage to cover, but some buyers remain unconvinced.
However, as vehicles – particularly EVs – become increasingly digitized, automotive manufacturers are looking at ways of exploiting the potential revenue stream that is associated with subscription packages.
After all, it is more lucrative to charge an entire string of owners a small monthly fee for a service, than it is to offer it as a one-time purchase when the vehicle is first configured.
This also goes hand-in-hand with the fact that the car ownership model is rapidly changing, with more buyers leasing or hiring their vehicles in one way or another than ever.
Buying a car is no longer the massive, one-time investment that is supposed to last for years, but is instead lumped in with the growling list of monthly outgoings that consumers have to contend with.
What was right for the original buyer of a vehicle might not be right for the second person to own it just two years into its life-cycle, which is where a Features-as-a-Service model has its benefits.
More than this, if BMW can streamline its manufacturing process by essentially building just one configuration of a model and then charging customers to unlock convenience features, such as a heated steering wheel, it is going to do so.
The automotive market is going through one of the biggest transformations it has ever witnessed, while competition is hotter than ever. These micro-transactions are seen as a way to smooth cashflow and as a result, and clearly aren’t going away soon.
Follow TechRadar on Google News and add us as a preferred source to get our expert news, reviews, and opinion in your feeds. Make sure to click the Follow button!
And of course, you can also follow TechRadar on YouTube and TikTok for news, reviews, unboxings in video form, and get regular updates from us on WhatsApp too.
TOPICS tesla
Leon PoultneyEVs correspondentLeon has been navigating a world where automotive and tech collide for almost 20 years, reporting on everything from in-car entertainment to robotised manufacturing plants. Currently, EVs are the focus of his attentions, but give it a few years and it will be electric vertical take-off and landing craft. Outside of work hours, he can be found tinkering with distinctly analogue motorcycles, because electric motors are no replacement for an old Honda inline four.
View MoreYou must confirm your public display name before commenting
Please logout and then login again, you will then be prompted to enter your display name.
Logout Read more
Apple's rumored 'Health+' subscription tier with AI features is doomed to repeat Garmin's failure
Pixel arrays, matrix headlights, OLED taillights: new lighting tech is bedazzling EVs
Tesla could soon bring CarPlay to its vehicles in a surprise U-turn – and many owners are happy
6 popular Apple apps now need a subscription to get every new feature
ChatGPT is getting ads, and that's just the beginning
YouTube might be planning to charge users to use its playback-speed tool
Latest in Hybrid & Electric Vehicles
‘The robot never gets tired’: Hyundai explains why its Boston Dynamics Atlas robot is ready to take over factories, but not your home
There’s a new robotaxi service hitting Las Vegas this year and this one is backed by an automotive giant
The best auto tech you probably missed from CES 2026
Vantrue unveils world’s first dash cam with thermal imaging for Predator-style night vision on the move
I’ve driven Kia’s debut electric van and it’s one of the most convincing electric people-movers out there
I review EVs for a living – here are the top 7 electric cars I drove in 2025
Latest in News
Rumor claims Nvidia won't have any new gaming GPUs in 2026
Guerrilla announces Horizon Zero Dawn spin-off Horizon Hunters Gathering, a 'tactical' 3-player co-op action game coming to PS5 and PC
430mph! Aerospace engineer (unofficially) reclaims the drone speed crown
Startups, listen up: Proton says you're not "too small" to be hacked
The Elder Scrolls 4: Oblivion Remastered is coming to Nintendo Switch 2 this year, along with two other huge Bethesda games
ExpressVPN unveils new standalone password manager – ExpressKeys is now available for iOS and Android
LATEST ARTICLES- 1Watch a garage-built drone hit 430mph – the new (unofficial) fastest drone on earth
- 2Nvidia might not have any new gaming GPUs in 2026 — and could be 'slashing production' of existing GeForce models
- 3Super Mario Bros. Wonder + Meetup In Bellabel Park does the impossible by finally giving Nintendo Switch 2 mouse mode a reason to live
- 4The GeekBook X14 Pro is one of the lightest laptops I’ve tested, and it packs plenty of power at a reasonable price
- 5'Our focus areas are enterprise... and just continuing to grow at the premium, you know, higher-end of the market': AMD CEO plays down global memory shortage, says she expects PC market to shrink
