Connected Car Will Still Be Steered By AM/FM.

INSIDERADIO

October 19, 2015

While the connected car of tomorrow is likely to include a touchscreen as big as an iPad and as many options and outsized ambitions and hype, radio industry executives that Inside Radio spoke with registered little surprise when studies showed AM/FM radio still rules the dashboard among consumers and auto manufacturers—and looks to continue to do so.

 

A handful of surveys over the past six months continue to confirm that the No. 1 audio device new car buyers desire is traditional radio. In its Sept. 30 RAIN presentation "Dashboard Dynamics," research company Strategy Analytics showed that 72% of potential vehicle buyers insist on AM/FM, followed by a CD player (50%), portable music player access (50%), apps (37%), satellite radio (29%), Internet radio (27%) and HD Radio (20%). Still, "daily radio users are likely or very interested in having local top-connected services available through their infotainment system," noted Roger Lanctot, Strategy Analytics associate director of Global Automotive Practice, which includes real-time traffic (70%), local gas availability (65%), weather (61%) and local search (51%). Steven Davis, an assistant buyer for car audio products at retailer Crutchfield, tells Inside Radio, "Manufacturers realize that the smartphone, Bluetooth and other connected services like Android Auto and Applelink are important extra features, but…AM and FM are still an important part of the [audio] puzzle." Adds Radha Subramanyam, president of Insights, Research & Data Analytics at iHeartMedia, "We know that regardless of what entertainment looks like in the future, an AM/FM radio will be part of your car. It’s built into American culture. It’s easy to use, it’s safe and it is America’s companion….Radio is a best friend in the seat next to you."
Connected Car—Seeking Balance Between Screen, Safety. The so-called connected car of the future has been described as everything from "vehicular content consumption" to a "digital hub on wheels." With today’s car entertainment systems already beginning to resemble a combination laptop and airline pilot’s console, one has to wonder: Is this too much of a good thing? While studies continue to show that the No. 1 most desirable dashboard feature is a traditional AM/FM radio, automakers are scrambling to offer younger new car buyers a dizzying array of clickable choices, including Sirius/XM, embedded access to Pandora and Spotify, USB inputs for smartphone connectivity, Applelink (which includes connectivity to an iPhone iTunes playlist), navigation apps and the old-school CD player.

 "Car dashboards seem drastically behind the times in terms of [user interface design]; they are unintuitive, cluttered with unnecessary information and, worst of all, distracting," a TechCrunch story espoused this month. That last point seems paramount. Carmakers stress that safety is job-one for the car of the future, but they are also driven to pack more into that increasingly ubiquitous dashboard screen. At the Radio Show, Scott Burnell, global lead, Business Development & Partner Management for Ford Motor Co., said that "broadcast is never going away, but the consumption of media is going to the digital side. As you scale younger, consumer habits will change— and these are the ones who will be buying vehicles for the next 40 or 50 years. We are aware that buyers under 30 don’t care about a button that says AM and FM. They say put it all on the screen and I’ll find it."

Numbers Show Auto-AM/FM Demand.

An April 2015 study released by market research company Ipsos provided an eye-opening revelation that despite all the many gizmos and gadgets working their way into vehicle dashboards, it is AM/

FM radio that consumers want most. According to the numbers, 84% of Americans choose traditional radio for audio entertainment over new technology options, with 62% listening to radio daily in their cars and 67% saying they tune in as soon as they put on audio in the car. Likewise, among those that are currently streaming digital audio services, 80% say they are not willing to pay for audio entertainment. "There is a tremendous level of comfort with the functionality and features of radio in the car," Ipsos MediaCT VP Thomas Spinelli tells Inside Radio.

 

"Despite the rapid growth in the connectivity and media options available in cars today, the average consumer simply does not want to lose their regular radio. These new infotainment options should be seen as complementary to traditional radio, not as a replacement for the familiar radio experience." Additional data also suggest that for young car buyers, those complementary options are worth waiting for. A recent survey from AT&T Drive Studio and Ericsson reveals that 78% of car buyers globally would delay a purchase by one year to buy a vehicle with connected services from their preferred brand. Also, 75% of those surveyed globally consider them an important feature in their next car. "This confirms that drivers today are tech savvy and value services that improve their driving experience," SVP of Internet of Things for AT&T Mobility Chris Penrose notes in a release. "With this increased awareness, we believe you’ll see adoption of integrated wireless connectivity in the car continue to take off."