OnStar US - Market Update from Strategy AnalyticsOnStar (North America) first stated that it had 2.5M service users in mid-02, yet by Nov-04 OnStar has still not made a formal announcement that 3M service users has been reached. Although OnStar is factory-installed and now currently available on more than 50 GM models – OnStar has only managed to increase the user base by around 500k in almost two and a half years. This calls into question the various ‘40% and above’ rates of re-subscription often discussed in the press, as well as the rates of service activation when a GM vehicle is sold. This report assesses the current OnStar portfolio and development activities and provides a strategic market outlook for OnStar under various re-subscription rate scenarios. At worst, Strategy Analytics does not expect OnStar to reach 5M users until 2009, and at best not until 2007. Strategy Analytics proposes that the strategic benefits of merging the business activities of OnStar and XM should be explored. Requests for more information, follow the link.
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