Tesla and AT&T are making a connection.

Tesla Motors [NSDQ:TSLA] picked AT&T as its in-car Internet service provider, the Washington Post reports.

The deal puts AT&T in charge of the many functions on the Model S electric car that are already controlled via wireless network. It was formally announced at an event in San Francisco yesterday.

"We’ve been working with AT&T. They’ve been the service provider for Model S" in North America, Tesla spokeswoman Elizabeth Jarvis-Shaen told the Post.

Tesla cars are equipped with AT&T network chips, enabling Internet browsing, navigation, and entertainment functions on the 17-inch center-stack touch screen display.

The chips also provide two-way connections for services like roadside assistance and stolen-vehicle location, AT&T told the Post.

The Model S also receives wireless software updates to improve its various computer-controlled systems, and Tesla could potentially use this connection to gather vehicle data as well.

Prior to the expanded deal, AT&T provided a data connection for certain Tesla cars on its 3G and HSPA+ (what it calls 4G) networks.

So far, Tesla and AT&T have not expressed interest in offering a 4G LTE connection in future electric cars.

This would allow drivers to access a greater volume of data through their cars. While it won't help the distracted driving problem, in-car Internet access is becoming a popular option among tech-conscious customers, and a new source of revenue for car makers and data providers

Audi offers 4G LTE in Europe on the S3 Sportback, and plans to expand the service to other models in its range.


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