With Verizon Vehicle, carrier muscles into auto club business

Verizon is hoping its Verizon Vehicle roadside assistance service represents a fast lane to connecting drivers.

The New York telecommunications giant on Tuesday unveiled Verizon Vehicle at the Detroit Auto Show, an after-market service that will work with virtually any car. The service, which will provide roadside assistance, diagnostic information, incident alerts and a hotline to mechanics, costs $15 a month and will launch around April 10.

Verizon's entry into the telematics business comes at a time when there's an increased buzz over the collaboration between the wireless and automotive industries -- and what that means for the driving experience and the notion of the connected car. The wireless industry -- AT&T, in particular -- sees the business of connecting cars as a new growth opportunity at a time when growth in the traditional smartphone business is slowing. On the automotive side, OnStar has been pushing its after-market telematics systems.

While AT&T has been working with car manufacturers, such as General Motors and Audi, to embed a cellular radio in their cars, Verizon is doing an end-around and going directly to consumers with its service. To set up the Verizon Vehicle service, a customer would need to install an on-board diagnostic reader module into the car and clip a Bluetooth-enabled speaker to the visor. Verizon said the module works with any car made since 1996, and the driver doesn't need to have Verizon Wireless service.

"We're introducing a new service that will make driving safer, smarter and more economical," said Verizon Telematics President Eric Goldman.

Verizon boasts that its service offers the first after-market telematic two-way communications service, but OnStar FMV also offers the same ability. Its after-market service will compete with the kinds of roadside assistance services the automakers are planning to offer through their connected car capabilities. While the connected car services are relegated to new cars with a cellular module, Verizon Vehicle can go after the much larger market of cars already on the road.

In addition, it represents a more sophisticated alternative to auto clubs like AAA, which charges $52 a year for roadside assistance.

Verizon Vehicle will provide pinpoint roadside assistance through the cellular module. It will also provide an update on the health of the car, send maintenance reminders, provide a one-button connection to live agents in emergencies and connect drivers with mechanics to provide repair advice. Users will be able to get alerts via email or text message or within a free smartphone app.

Customers can preorder the Verizon Vehicle equipment here. The service requires a two-year contract, and Verizon is offering to waive the first month's fee. Drivers can add more cars for an additional $13 a month.