How the CarData system works: It collects information from cars that have been registered by owners using the BMW ConnectedDrive app. BMW stresses that the CarData system will only collect data from cars if the owners give permission. This information is then stored on IBM servers and can be redistributed to companies to use for various services.
BMW and IBM provided a few possible examples of the services that could be provided or improved using CarData. One possibility would be quicker diagnosis and repairs of vehicles, since shops could access information on the car's condition before arriving. Another would be reducing insurance rates by sending insurance companies precise data on mileage and driving habits. Think of it like the little transmitter devices insurance companies such as Progressive and Allstate offer to monitor your driving for better rates.
BMW has only launched CarData in Germany to start, but the company plans to expand to other markets in the future. IBM also makes it clear that it's more than happy to provide the same type of cloud system for use by other car companies.