In its first big move to expand into a software company, General Motors is introducing a new software platform it created called Ultifi.
The automaker will begin putting Ultifi (all-tee-fy) on some internal combustion and electric vehicles starting with the 2023 model year with the hope that it helps boost consumer loyalty to GM cars and opens up new channels to revenue beyond car sales.
"Ultifi is a big, big step in our software strategy," Scott Miller, GM's vice president of software-defined vehicles said Wednesday. "Today, cars are enabled by software, with Ultifi, cars will be defined by it."
Last week, Alan Wexler, GM's senior vice president of innovation and growth, announced that GM has a new business model that extends beyond the hardware of building cars, to becoming a software platform innovator.
Wexler said GM's vehicles will merely be a platform to deliver GM-developed software to offer consumers services beyond driving. Those services can then be used in their homes and other areas of their lives. Wexler called GM's new business model, "a potential game-changer for delivering subscription services that create recurring revenue."
Ultifi is the first step in GM's new business model, Miller said. It builds on GM's current vehicle intelligence platform (VIP). Think of VIP as a smartphone and Ultifi as the operating system that provides the functions.
Ultifi holds the potential for more cloud-based services, faster software development and new ways GM can increase customer loyalty.
"At our core, we're going to make great cars, trucks and vehicles," Miller said. "What we're talking about is adding a platform with Ultifi. (Customers) will love it when they buy it, but they'll love it even longer as it gets better. When the next new thing comes out they can add it to their vehicle and not have to go buy a new car so this improves the relationship with them."
Similar to software on a smartphone, Ultifi can provide regular updates and let customers choose from a variety of over-the-air upgrades, personalization options and apps.
For example, imagine a camera inside your car that recognizes your face and starts the engine for you. Or, the camera can detect if there's a child in the back seat. Miller said those services would not be subscription.
Another example would be a weather forecast with the ability to close a vehicle's windows if it's parked in an area where it's expect to rain, Miller said. Or an alert that warns drivers of specific icy spots on roads.
GM will open Ultifi up to allow third-party developers to create content for it and there will be the chance to add subscription offerings, for added revenue for GM. But Miller declined to say how much revenue GM expects it will generate.
A GM spokesman said the automaker will discuss revenue in more depth next week, most likely at its Investor Day on Oct. 6.
But Miller said GM will work out a revenue sharing formula with third-party software providers, noting, "They're not going to come to our platform for free, but we're not going to give up our platform for free either, so that's a solvable issue we'll address in the future."
A customer will buy a car with Ultifi on it and then choose various plans with it or levels in terms of the number of upgrades they will get, the kinds of services and software or apps they want to access.
"The key thing about Ultifi is we like to call it continuous integration," Miller said. "We're separating the software from the hardware so we can continuously upgrade apps. It will allow us to be very agile and constantly learn how to make it better."
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