A study by Strategy Analytics, In-vehicle Entertainment Systems Market 2004-2011, states that “automotive original equipment manufacturers (OEMs) should be cautious about introducing satellite digital radio options, despite the increasing adoption of satellite radio among U.S. consumers.” The reason? Terrestrial radio’s dedication to the growth and implementation of HD Radio.
“XM and Sirius face competition from iBiquity’s HD Radio. However, iBiquity now needs to shift focus from radio station upgrades to consumer system upgrades,” said Strategy Analytics Automotive Multimedia & Communications Service analyst Clare Hughes. “There has been significant investment in terrestrial radio station upgrade by iBiquity; however this now needs to be translated into revenue.”
Strategy Analytics does expect the market for in-vehicle satellite radio in North America to increase from 5.2 million units in 2004 to 12.8 million units by 2011, but that is in terms of shipments in the original equipment, which doesn’t necessarily translate to subscriptions. XM recently reported during its second quarter conference call that six out of ten people that buy a car with a factory-installed satellite radio accept the service.
Strategy Analytics also reported that the “explosive satellite radio growth seen over the last three quarters will not translate automatically into the automotive market however, and growth in general will slow down toward the end of 2005. In-vehicle satellite radio growth will face competition from portable satellite radio devices and HD Radio/iBiquity systems.”
BMW recently became the first car company to offer HD radio as a factory install, with the others expected to follow soon. And terrestrial radio companies are starting to launch HD side channels, with more announcements expected such as the one made by Greater Media Detroit. Until the BMW announcement was made, both satcasters have had free reign over in-vehicle digital radio, but as terrestrial radio steps up its campaign, the competition will heat up, giving consumers a choice beyond one of the satcasters.
2 responses so far ↓
Phil // March 15, 2007 at 3:38 pm |
HD radio (and to some extent, its satellite cousin) is a purely transitional technology.Fully mobile WiFi is the category killer. HD is the Pontiac Aztec of broadcast technologies – looks good on paper and in research, but…
ghkj // February 2, 2009 at 6:19 am |
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