GM OnStar’s recent debacle over its proposed changes in its Terms and Conditions covering data collection and privacy is a demonstration of how poorly planned interaction with consumers can lead to confusion and mistrust.
OnStar sent its customers emails telling them that from December 2011 their service Terms and Conditions will change so that data from a customer’s vehicle will continue to be transmitted even if the service has been cancelled, unless the consumer phones OnStar and specifically requests the connection is disabled.
The new Terms and Conditions also gave OnStar the right to share the telematics data with third parties such as insurance companies. These new contractual terms generated lots of negative media reporting and many customer complaints in the USA due to concerns over personal data privacy.
This storm of customer complaints and harmful media commentary lead OnStar to reverse its decision and cancel its plans to collect data. The data connection to vehicles after the service is cancelled will not now be maintained unless the customer opts in. “OnStar’s main error was not explaining how consumers will benefit from the collection of data from their vehicles,” says Stephen Longden, author of SBD’s recent report Connected Car Guide ~ Government edition. “Drivers of vehicles that are providing data could receive a discount in service costs or reduced insurance charges. GM also failed to explain clearly why the data is being collected and what it will be used for,” says Longden.
“Our research shows that data privacy is a potentially sensitive issue for consumers of automotive telematics services,” adds Longden. “In addition to complying with national and state data privacy legislation, vehicle manufacturers and their telematics service providers need to clearly educate their consumers about what will happen to their data.”
“As automotive telematics services become increasingly widespread in the different world regions, vehicle manufacturers will have to respond to varying consumer concerns relating to personal data privacy and the different laws and regulations in each country,” says Longden. “One data policy will not fit all markets.”
Interested in learning how to avoid such pitfalls? SBD’s Connected Car Guide ~ Government edition provides a clear explanation of mandates, restrictions, policies, licences and guidelines affecting the Connected Car business ecosystem. Click here to read more and contact Alessio at ABallatore@sbd.co.uk to buy this report.