Tesla’s Betting You’ll Pay $9,000 for a Software Upgrade(bloomberg.com) |
Tesla’s Betting You’ll Pay $9,000 for a Software Upgrade(bloomberg.com) |
This isn't a software upgrade. It's an on/off switch.
There's a difference. A software upgrade implies some new code which cost real money to develop is being made available. That's not the case here.
As others mentioned, manufacturers do this already for cost reasons (reducing variation) on other software, but in that case it's legitimately a software upgrade because the new software being turned on cost actual money to develop which they recoup by putting it behind a paywall.
In this case, it probably actually cost Tesla money to implement the software to cap the battery.
What we have here is software being used to implement a paywall on hardware to recoup hardware development costs (presumably developing the 75 battery cost more than developing a 60 would have). It's a software-controlled hardware upgrade which happens to not actually be implemented as an upgrade because of cost control reasons.
I don't know that there is precedent for this precise business model.
CPUs for example are clocked at a set speed when they reach the consumer, they can always go higher without any negative impact (infact most are underclocked). It's basically a software switch that turns your 3.2 Ghz CPU into a 3.4 Ghz CPU.
You buy a SAAS product they have multiple levels, it's just a software switch that says you can X package or Y package. This is slightly different because the features may be more resource intensive or something else, but basically it's the same.
Current cost of Li-ion battery is $145/kWh. It surprises me that they'd chose to give away $2250 worth of battery simply because it costs more to develop a new one. I understand the batteries they use are pretty modular - the cost of adjusting down capacity should be minimal. I'm speculating that they expect a large portion of buyers of the 60 model to upgrade to the more expensive version to recoup the costs. They could make the price of the upgrade a decreasing function of the age of the vehicle because no one would want to update an old car.
The lower price point plus the upgrade revenue can certainly be expected to cover the costs of the program (because that's how businesses work).
Did you? The remaining battery is essentially lent to you.
I think if you say that Tesla is liable for mistakes you make with one of their vehicles you make it hard to sell kitchen knives.
Do you have a source for your claim?
reads article
Oh. An anti-feature.
> The only difference is that the software on the lower-end version limits the capacity of the S60’s battery, crippling its range. In fact, owners can instantly transform a lowly S60 into an S75 at any time for a fee of $9,000 ($500 more than if they’d initially bought it that way). They don’t even have to bring the car to a service center. Tesla flips the software switch remotely.
As users find out about things like this, and as it starts effecting them more and more, there will be an aura of distrust.
Currently, I'd say programmers or IT-related people are the only ones that care about this. But as soon as the consumer sees they need to pay 9k for something they already have? Closed source software is done for.
When I had to register my car in a different state the ad valorem taxes and fees were $500 in the first year.
So you buy the 60, after you register the car and get the license plate, you pay $9k and save money on taxes.
For example, when I buy a DVD, I don't really own it. I own a physical copy of the media with a license to only play it in an approved player.
This has spread a bit for example to gaming. Katamari Damacy for the 360 was actually shipped with DLC on the game disc that you had to pay additional money to unlock, and it wasn't the only one.
If I were rich enough to afford a Tesla, I guess it would probably be against the license to use the hardware I have to the fullest (if I didn't pay for it), because Tesla doesn't want that and I've only licensed their software.
If this is the future for electric car business models where we have software defined features, I'm going to disengage as an early adopter. I actually think they should not sell the cheaper version because it dilutes the brand and the software upgrade starts to make the brand give off an enterprise subscription stench.
Where does this business model end? Am I going to have to renew my battery algorithm subscription yearly or my car turns into a piece of locked out hardware? Maybe I have to pay regularly to download self-driving updates? Am I going to have to pay to support the infrastructure to receive updates long after my car ends its production run?
If you take the 75 option, you could keep the charge limiter set to 80% for normal use and achieve the same effect as keeping a software-limited 60 at 100%, but with the option to bump it up when you need more.
I expect that could be very popular.
While I imagine the author hoped to try to put this in a negative light to stir up controversy, this of course is actually a great thing. As with any other car, if you have a car and want much better mileage or a big new feature like self driving, you won't be paying 9K for the feature you will be spending 50-100K+ since your only option is to buy an entirely new car every few years to get the latest features.
Any to get the new features I don't need to pay all the thousands associated with getting a new car, as well as negotiating on a new car, and everything else associated with it. Of course Tesla could just offer all features and build in the 9K in the car, and thus not allowing anyone who can't afford all the features to ever have a tesla. Instead they price it so people who want a tesla but dont necessary need some of those features a chance to buy the car, and then later get those features if they save up. Win win for everyone.
But most likely people complaining will be the same people who complain about the entry level storage on an iPhone. They would rather apple not sell it at all, than let people who can't afford the higher amount be able to buy an iPhone at all.
You may have a 75 kWh in your car, but you didn't pay for it. You paid for a 60 kWh so that is what you get to use.
Tesla has merely optimized the logistics a the battery upgrade, pre-delivering it and pre-installing it, doing 99% of the work at no charge. When you pay for it, they can make the upgrade as easy as an in-app purchase.
Isn't the price kind of arbitrary? Would you accept this with any other product? Like buying a cheaper house because some of the rooms are walled off, or a hard drive that has a few GB of unremovable data, until you pay more.
People don't make "rational" decisions in the face of perceived injustice.
Plus I wonder how long before someone hacks these cars for personal use only?
My understanding is that you choose which car to buy, and then you pay them thousands to flip a bit to enable extra horse power, on the same hardware.
Or you get some shady garage to chip it for you.
This is actually a really smart move by Tesla. They are able to offer a lower cost version of the car, without changing anything on the manufacturing side. Thus increase sales through a lower price entry point.
More complicated logistics could also be detrimental to the environment.
I wonder if you can "hack" it yourself :)
I guess I don't really care, especially if there is good disclosure for expensive physical devices (because I can then not buy them).
Businesses are now trying to give you things for free in exchange for rights to your data. That's the entire social media business model. It is so lucrative at the moment that even microsoft is now employing the social model for their consumer OS ( starting with windows 10 ). You get a "free" OS, but that OS is going to track what you do and sell your data.
Of course this model is much easier for software than hardware because of the low cost of distributing software and an easier way to achieve scale. If hardware decides to try this model, it will be interesting and funny to see what the implications would be. Tesla could offer to lease you a "free" car but they get to monitor you, collect your data and sell your data. Hell, what happens when housing developers try the "social media" model. You get to lease a "free" house but the developer gets to record/monitor everything you and sell your data.
You don't have to jailbreak. You can get the car fully unlocked from the factory. But it costs more.
So again, what would you prefer, not having the lower cost option, or having the lower cost option be hardware limited? Or is there some third option you want?
The 4S did come with noise-cancelling microphones and an extra chip to support this; I believe the official line is that this hardware was required for Siri to work with sufficient reliability.
Edit: here's an article about jailbroken Siri: http://www.cultofmac.com/133196/fully-functional-siri-arrive...
If the same engine can run at higher RPM it could mean that it needs better tolerances to achieve it so they bin the better parts for those engines.
Other things might also be slightly different like slightly different fuel injectors, seals etc. that can handle the more demanding workload.
You can tune virtually identical parts to perform differently but that process usually has a cost to it.
Having a blue car with extra so-and-so in every horse power engine would mean they'd have to stock that much more.