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Funny you should bring this up.
OK, my dealer in Gloucester, Cotswold, sounds better than the one you are talking to. For a start they say that a software update is about £100, although did say that a new s/w update is released about every 3 months. The usual routine is to plug in a diagnostic at service time, and computer says yes or no as to whether the car needs something addressed by the update.
Mine is a september 2010 car, and my understanding is that the latest software gives a very small increase in MPG.
When my dealer told me he might charge for an update, I told him, in almost medieval langueage, to do one. I told him that the declared MPG of the vehicle was 43 or thereabouts, and although you don't expect to get that, the 29/30mpg I get is very substandard, and that any update that might address this WILL be free or I would kick off with the dealer principle, and then, if necessary, BMW direct. He looked a little uncomfortable, and has booked it in on Monday to plug it in and see what the computer says. He will be updating it, and I won't be paying.
As far as I am concerned, a car should receive these updates free whilst in warranty. And if they want me to spend 50k on a car then be screwed over for a few quid for something like this, they will never get another bit of business from me again. I will update you after Monday with what happens!
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