Terrestrial Radio Stations Have Company: In-Car Streaming

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1 4,257 views Apr 30, 2011

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The combination of smart phones, ubiquitous Internet connectivity and streaming radio may soon send the in-dash radio to the same dusty scrap heap that welcomed the eight-track, the Walkman and meals in tubes. KnowDigital released a new study today offering that two-thirds of listeners 18 to 44 years of age had recently consumed streaming media while on the move. 

For many, this is in the form of plugging their smartphones or music devices into jacks  on existing head units. For others, the external speaker on their phone is sufficient. Sam Milkman, president of KnowDigital, offered that “many industry insiders think of streaming radio as primarily an at-work and at-home medium, but the majority of users we interviewed reported engaging in this activity in their cars.”

The study suggests 22% of Americans listen to streaming radio, based on a report commissioned by Arbitron & Edison Research in April this year. The conclusion of the KnowDigital study is that in-car streaming is happening today even though there are usability barriers such as changing stations and skipping songs when on the move. 

The report notes that terrestrial radio is not dead by any means. Many terrestrial radio stations have offered streaming alternatives, seeing no difference between over the air and over the network delivery. Over-the-air radio still offers unique content such as news, traffic, weather and sports and has a hand up in terms of ease of use. 

However, consumers are spending money to add in-car streaming, with respondents dishing out an average of $400 to enable connections with their phones and other devices. Many vehicle manufacturers are embedding connectivity options in their latest models, from the Ford SYNC offering to the more commonplace USB ports on audio head units. 

Managing the location of handheld devices (cupholders seeming the most common) is still a chore. As smartphones offer more and more functionality (from music streaming to GPS) they seem set to move to front and center of the in-car experience. 

As of 2004, there were around 6,200 FM radio stations in the U.S. Listeners are limited by proximity to the transmitter, meaning that in any one place there may only be a handful of stations. The beauty of Internet radio is that all stations are on all the time and listening choices are not limited to those in range. So, while driving through Cincinnati, you could be listening to Swedish folk radio. 

While there are still challenges in terms of usability and continuous connection, many of these have been addressed by after market suppliers. Vehicle manufacturers are catching up and recognizing the demand, just as they did with satellite radio in recent years. The lure of choosing your favorite provider and staying with them regardless of how far you might travel is a siren call. And that means terrestrial radio has company.