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GM sued over OnStar change

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GM sued over OnStar change
Sharon Terlep | Link to Original Article @ The Detroit News
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A disgruntled Cadillac owner, whose OnStar service will go dead next year as a result of upgrades to General Motors Corp.'s peace-of-mind roadside assistance feature, filed a class-action lawsuit Wednesday against the automaker.

Robert Weaver of Virginia bought a new Cadillac El Dorado in 2002 equipped with GM's OnStar, a much-advertised communication system that links motorists with live operators who can offer driving directions and emergency help.

Weaver is among 1.5 million owners who will be affected when OnStar completes its switch from an analog system to a more current digital network.

While newer GM vehicles are equipped with digital receivers, many older models are not, meaning they will lose OnStar when the analog service shuts down starting next year. Some vehicles made between 2002 and 2004 can be upgraded, but all pre-2002 models will become obsolete.

GM says about 500,000 vehicles have analog systems that can't be upgraded and 1 million have digital-capable systems. A small number of Acura, Audi, Subaru and Volkswagen models are affected.

The switch is a result of a 2002 Federal Communications Commission decision to let cell phone companies shutter their analog networks starting in February. OnStar is carried by Verizon Wireless.

GM has heavily promoted OnStar with commercials featuring dramatic real-life calls between motorists and operators, such as one from a child phoning for help after a car accident.

In the lawsuit, Weaver charges that GM knew it was switching to an all-digital network but continued to sell analog-only systems and failed to inform customers they were to be phased out.

He calls for GM to reimburse all affected customers the $199 cost of the OnStar system along with subscription fees. The suit also seeks to block GM from shutting off service or from charging customers the $15 cost of an upgrade.

The suit was filed in the U.S. District Court for the Eastern District of Michigan on behalf of Weaver and any affected OnStar customers. Weaver's attorney could not be reached for comment Wednesday.

GM, in a statement, said switching to digital was the only way it could maintain comprehensive coverage in the United States and Canada as cell phone companies cancel their analog service. Nearly 90 percent of OnStar subscribers have vehicles that either have the digital system or can be upgraded, according to GM. For those who don't, GM will provide a year of free OnStar service on any new vehicle leased or purchased by the end of the year.

The company said it has sent letters advising affected customers of their options. In addition, by charging only $15 for the upgrades, GM is covering most the cost, said Bill Ball, OnStar vice president of public policy.

"It's a very frustrating situation for subscribers and for us," he said. "The engineers have done their best to try and provide a solution for as many folks as we're capable of doing."
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I'm on the fence about this, in a way I agree with the owner of the Eldo, but then again its also a sign of the fact his Eldo is getting older and "it's" features and technology will be improved and/or changed in the future. Now I may be talking out of my ass here, but when 8 track players were replaced by regular cassette tapes, did owners sue car companies because they spent money on 8 track tapes? It's the same principle. Or even perhaps a better example is when radio stations for the most part moved to FM radio, but older cars only had AM radios, they're radios became obsolete as well in a way. So I guess he could buy a newer Cadillac and keep the Eldo. I do feel however that for people that have come to expect service when they push that blue button, they should be compensated in some way, and I'm sure for most people it is a security blanket in a way.

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I'm on the fence about this, in a way I agree with the owner of the Eldo, but then again its also a sign of the fact his Eldo is getting older and "it's" features and technology will be improved and/or changed in the future. Now I may be talking out of my ass here, but when 8 track players were replaced by regular cassette tapes, did owners sue car companies because they spent money on 8 track tapes? It's the same principle. Or even perhaps a better example is when radio stations for the most part moved to FM radio, but older cars only had AM radios, they're radios became obsolete as well in a way. So I guess he could buy a newer Cadillac and keep the Eldo. I do feel however that for people that have come to expect service when they push that blue button, they should be compensated in some way, and I'm sure for most people it is a security blanket in a way.

Yes, but those AM radios still work, the 8 track players still work, etc. The problem in this scenario is GM is breaking backward compatibility of a service without providing an upgrade path.

Edited by moltar
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I agree with you and with the Eldo owner...which is why I'm on the fence, I do feel that GM should make it right for owners of older vehicles with Onstar.

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Just like insurance companies operate: OnStar worked for this guy from '02 thru '08... that subscription money is gone- it paid for the service. Damn greedy people.

I could see a partial reimbursment for the option price had the service cut-off in -say- a year or 2... but 6 ?? It would be a nice jesture, but even half the option price x the 500K incompatable owners... that's $50,000,000!

Are the owners of affected acura, audi, subaru and vws class-actioning their respective makes, too?

As far as blocking GM from discontinuing analog broadcast? The FCC allows it and Verizon carries the signal- make sure you sue-happys go bang on their doors, too.

Sh!t, GM gets banged for old tech and gets banged for new tech- never a frickin' break.

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I think there's a reasonable feeling of "WTF?" in cases of certain model years where the digital technology existed and was integrated into newer models but not retroactively installed in older ones. Such is the case with my father's Bonneville; while his is a 2000 and has no chance of being upgraded, 2004 models (I believe) were still being fitted with analog equipment even while other, newer 2004 models recieved the digital service.

Frankly, I don't care because we had OnStar once, haven't had it for years, and never will again for reasons beyond this issue. It would take a lot more than a month of free service to convince me OnStar is worth the extra money again.

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I think there's a reasonable feeling of "WTF?" in cases of certain model years where the digital technology existed and was integrated into newer models but not retroactively installed in older ones. Such is the case with my father's Bonneville; while his is a 2000 and has no chance of being upgraded, 2004 models (I believe) were still being fitted with analog equipment even while other, newer 2004 models recieved the digital service.

Frankly, I don't care because we had OnStar once, haven't had it for years, and never will again for reasons beyond this issue. It would take a lot more than a month of free service to convince me OnStar is worth the extra money again.

Part of the problem here was that GM/Onstar didn't know who they were going to switch do. Do they go Verizon? Do they go GSM? Do they go nextel? Yes they were a bit slow making the decision......

but what happens when CDs are no longer produced and you can only get your Nav system map upgrades on Blu-Ray.... what then? What happens when there is a replacement for Bluetooth in 10 years and all the new cell phones come out with "greentooth" and aren't compatible with your 2007 STS? What happens when XM and Sirrius eventually merge and require an "upgrade" in order to continue using the service.

Think of the precedent that this case sets up for technology in cars....... and what sense does it make to sue GM over this when GM doesn't control the Cellular Network/Bluetooth standard/CD manufacturing/XM Radio system?

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GM is not the one shutting down the service. It's actually an FCC ruling that has allowed the analog cell phone companies to shut down those analog frequencies and have them reassigned for other uses starting in 2008.

Edited by Pontiac Custom-S
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nothing is future proof.....i bet a digital to analog converter could be made by a 3rd party.... like nearly everything else people "need" when original "services" can't be continued.... like when NOS parts run out. hehe

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I'm feeling no pity for these people-tough poop.

Times change.Life moves on. :rolleyes:

If you can't, oh well. We live in a tech savvy world. This is the price you pay to play.

There will be a time when all these cars with Nav will be useless, one way or another.

If GM could offer a portable system for the older cars-that could help.

It's just like people who had tape players....you upgrade to a CD player.

You move on.

Onstar is no different.

If you think this is interesting, I can't wait to see how the Mygig thing goes in the new Focus...

Edited by daves87rs
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This shouldn't be an issue of whether GM is obligated to provide some sort fix for these OnStar clients, they should take care of it anyway. The lawsuit is proof enough that you're pissing off a bunch of people who buy GM and highly regard the OnStar feature. This should have been viewed as a great way to appease those customers and solidify their return business. And for the people who don't feel GM is obligated, this is a great opportunity to really impress the notion that GM goes above and beyond thus not only ensuring their return business but also making them into GM advocates...something GM doesn't have too many of these days. Thinking long term, how much would it have really cost to retro fit vehicles with the equipment necessary to carry the new OnStar service? Not to mention that OnStar would gladly shoulder some of that cost as it is in their best interest to keep subscription figures up.

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I can understand the guy's frustration....

BUT ... mostly ... this just seems to be another example of how people are "trigger happy" when it comes to lawsuits.....

It'll be interestig to see how this develops/progresses.

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Damned if you do damned if you dont. This is a good time to examine an OnStar contract.

Personally, I think its a frivolous BS lawsuit that will eventually be thrown out.

The service was provided, no reason you should recoup that spent money.

If that was the case every dropped cell phone call would equal money in the bank. Every cassette or 45 purchased should be traded in for an i-pod at Apples expense. Your digital phone should have been no charge when it had to be upgraded. That vhs or dvd that wore out...those bastards. A free blu-ray and an HD just to make up for it.

This pissed me off the first time around. Sad part is GM is going to pay some big bucks to the lawyers to crack this nut anyway. f@#kin shame. I would have sent a letter saying "We regret to tell you the FCC has decided to ban Analog service and basically told us all tough tits deal with it. While we dont think this is fair you can reach the FCC at 1888xxx-xxxx to find out more. In the meantime we here at GM will try to make the transition as pleasant as possible."

What a fken joke.

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Man, its too easy being right.

I think the fact OnStar was/is promoted as a safety device is the big issue. I thought it would be a roadside death in an analog On Star auto....I guess the class-action attorneys got there first.

Yet another PR debacle for the RenCen....

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Apparently not...

Cute.

Point made---but if you go back to the original posts on this topic months ago...I was nearly alone in my opinion that this thing would become a legal and PR nightmare.

At least a periodic, begrudging acknowledgment, Fly?---oh, BTW, still no Saturn events in my area...nor a billboard for the Outlook or Aura...and they've still got the old Saturn dealer down the street boarded up....pure genius.

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Point made---but if you go back to the original posts on this topic months ago...I was nearly alone in my opinion that this thing would become a legal and PR nightmare.

At least a periodic, begrudging acknowledgment, Fly?

Actually, you were hardly alone; many people figured this would result in some sort of legal entanglement, but the debate was over whether there was any legal basis for it. You virulently argued that, yes, there was for a variety of reasons. We'll see if the courts prove you're opinion correct or not.

---oh, BTW, still no Saturn events in my area...nor a billboard for the Outlook or Aura...and they've still got the old Saturn dealer down the street boarded up....pure genius.

Similarly cute. Our local Saturn dealership is remodeling to the new look and also kicked Mitsubishi out of its air conditioned double-wide so it could expand its operation. I guess I shouldn't mention the Toyota lot that recently lost some of its unused lot space to WalMart. Anecdotes mean alot, especially when they're relevent to the OnStar topic.
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Actually, you were hardly alone; many people figured this would result in some sort of legal entanglement, but the debate was over whether there was any legal basis for it. You virulently argued that, yes, there was for a variety of reasons. We'll see if the courts prove you're opinion correct or not.

Exactly.

It really isn't a surprise in a nation that will sue over a hangnail and award millions for a hot coffee spill.

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Actually, you were hardly alone; many people figured this would result in some sort of legal entanglement, but the debate was over whether there was any legal basis for it. You virulently argued that, yes, there was for a variety of reasons. We'll see if the courts prove you're opinion correct or not.

Similarly cute. Our local Saturn dealership is remodeling to the new look and also kicked Mitsubishi out of its air conditioned double-wide so it could expand its operation. I guess I shouldn't mention the Toyota lot that recently lost some of its unused lot space to WalMart. Anecdotes mean alot, especially when they're relevent to the OnStar topic.

If a class action is a 'legal entanglement', then clearly, you have no idea how invasive, expensive and time consuming a class action can be.

Right or not, GM will end up paying in legal fees, PR points and another unneeded association with a decision that leaves loyal customers high & dry.

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So if the some OnStar equipped vehicles had analog and digital why can't these analog ones be retrofitted with digital? I'm not sure how it works...

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If a class action is a 'legal entanglement', then clearly, you have no idea how invasive, expensive and time consuming a class action can be.

Right or not, GM will end up paying in legal fees, PR points and another unneeded association with a decision that leaves loyal customers high & dry.

Again, the debate was on the legality of such a claim.

I don't know what the result of any phase of this lawsuit will be. Likely, no one will, especially if it goes into arbitration and is settled for a pittance all around. Unless some court rules that General Motors is legally responsible for either retrofitting affected cars with digital systems or paying restitution, I doubt you'll see this covered in any new article and I highly doubt any court would make such a ruling.

Let's look at the lawsuit again:

He calls for GM to reimburse all affected customers the $199 cost of the OnStar system along with subscription fees. The suit also seeks to block GM from shutting off service or from charging customers the $15 cost of an upgrade.

1) $199 cost of OnStar - This is arguable, but only for those that purchased OnStar as an option as opposed to a bundled package. One could argue that GM sold owners of 2002-2004 analog vehicles a bill of goods in that they knew such systems wouldn't function after the switch and continued selling them anyway. However, such a claim could be countered by the fact that GM didn't know for a fact that Verizon would leave them completely in the dark. That itself could be countered by suggesting that for the average person, this is true, but with GM's knowledge and agreements, it would be neglegent in not seeing this coming.

So, a refund of the purchase price for original customers who bought analog OnStar as a non-bundled option and desire to continue using it in their current vehicle but cannot is contestable and may be a good end-point for a settlement.

2) Subscription fees - If I interpret this as to mean a refund of past subscriptions fees paid by analog OnStar subscribers, completely irrational. I pay you for a year's service. You give me a year's service. Our contract is over. This is literally asking to have the cake and eat it, too, and has absolutely no legs to stand on. For those who are still subscribers, GM is no longer accepting money from them as they will not be able to provide service. As far as I know, OnStar hasn't issued any lifetime service agreements either.

3) Block GM from shutting off service - Again, not rational. GM is not shutting off service; Verizon is. GM provides the equipment, the operators, and the support while Verizon provides the wireless network. Sue them or sue the FCC for allowing them to shut down analog equipment. Its a shot in the dark, but a better shot than suing GM for something they do not control.

4) $15 upgrade - We all know the actual cost in labor and equipment is much more than $15. GM is eating the vast majority of the cost, rendering this a frivilous request.

What basis do I have for arriving at those conclusions? Besides watching Law & Order, none...just my common sense. I think common sense will win out in this argument, too. My personal belief is that GM owes original owners of 2002-2004 non-upgradable analog OnStar vehicles something because I think GM should have installed the new dual-mode equipment across all car lines at once rather than by model (which is what it seems like they did).

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