Digital Radio Struggles to Create Demand and Instead Settles for Acquiescence

Boston, MA - August 15, 2011 – The in-vehicle audio landscape is becoming increasingly crowded.  The Strategy Analytics report, “Harmonizing Radio Transmission:  Can AM/FM, Digital Radio, and Satellite Radio Coexist in North America and Europe?” examines how new and revamped radio solutions are changing these markets.

John Canali, Senior Analyst in the Automotive Consumer Multimedia and Communications Services at Strategy Analytics notes, “In light of the recent hype around Pandora’s IPO, SiriusXM has gone on the offensive to remain the leader for in-vehicle premium audio content.  With over 21 million subscribers, SiriusXM is a proven leader in automotive content in automotive and will be difficult to dethrone.”

In contrast to Satellite Radio in the US, the market for digital radio has struggled in both the US and Europe.  In the US, HD Radio is starting to attract automotive OEMs that are willing to make HD Radio a standard feature.  The European market is much more fragmented. Key announcements in Germany might give rise to greater support.

Canali continues, “Digital broadcasters thought that they could create a market by simply creating additional content.  Unfortunately for broadcasters, strong consumer demand has yet to materialize as consumer awareness of digital broadcast technology is low.  With falling component prices and greater automotive OEM support, consumers in the future will likely be purchasing a vehicle with a digital receiver whether they ask for it or not.”