Part one of an exclusive series on what’s ahead in radio’s place in the digital dashboard. General Motors is credited as the first automaker to create a “connected car” in 1996 with its OnStar system. A decade later, the term—when you excise autonomous driving—includes in-car entertainment units, in-dash screens, smartphone apps, navigation, voice commands and wireless connectivity.
More to the point, according to the National Association of Broadcasters senior director of Advanced Engineering, David Layer, it is “mobile broadband to augment over-the-air radio and deliver competing audio services to listeners.” In other words, it’s essential for broadcasters to fasten their seat belts; while there’s no imminent crash, the ride could get bumpy.
With this story, Inside Radio launches a new series that explores how AM/FM will fit into tomorrow’s dashboard and how traditional radio may fare alongside soon-to-be in-car wireless, amid a continual outlay of high—and higher—tech. (Future chapters in the series will take a look at the innovations of individual automakers and their connected car products and strategies.) There is anxiety, for sure, but broadcasting pundits also envision an array of new opportunities for traditional radio by integrating digital innovations into the dash.
“We really do think the connected car is the future—and the future is kind of here now,” said Joe D’Angelo senior VP of Broadcast Technology for Xperi (the owner of HD Radio technology) at last month’s NAB Show in Las Vegas. “In the old days, you had AM and FM. Now we have expanded choices with all that is available on the internet. And audio goes both ways. With interactive touchscreens, how consumers interact with audio has completely changed.”
By no means does that have to be a negative for broadcasters. “Radio will remain dominant in the dashboard because of its simplicity, localism, the economics of broadcast and its amazing programming,” D’Angelo added. “And now connectivity is there for you to take advantage of.”
First and foremost in radio’s comfort zone is a statistic that has been widely reported: The 2017 Edison Media and Triton Digital Infinite Dial study revealed that a dominant 82% of consumers aged 18+ who have driven or ridden in a car in the last month say they listen to AM/FM radio in the car—a statistic that has shifted little since 2014.
Meanwhile, an IPSOS poll asked 1,000 adults about entertainment preferences in their next car—80% chose AM/FM over CD players, connected smartphones and other forms of audio entertainment. And 84% of respondents said they regularly tune in to AM/FM radio, while Sirius/XM Radio, Pandora and Spotify account for 22%, 18% and 7%, respectively. A recent Forbes story added, “Efforts to remove AM/FM radio from the automobile falls squarely into the ‘If it ain’t broke don’t fix it’ category. Based on heavily sampled consumer preferences, the data suggests this would be a grave mistake.”
Michele Laven, iHeartMedia’s president of Business Development & Partnerships, tells Inside Radio, “Our brands are already found in every car through AM/FM radio, however, we are committed to extending our stations and brands everywhere our listeners expect us to be, across multiple platforms through iHeartRadio, our all-in-one digital service.” Laven added, “I have not spoken to an OEM that will disagree with the power of our radio stations and how we connect with the audience—and research continues to show that drivers overwhelmingly still want the ease and simplicity of AM/FM radio.”
Added Fred Jacobs, cofounder and president of Jacobs Media, whose annual DASH Conference is consistently one step ahead in the connected car realm, “It is still easier to listen to broadcast radio and satellite radio in cars, thanks to the simplicity of presets. Listening to podcasts, Spotify or Pandora takes a little more work.” That said, Jacobs added, OEMs are dedicated to “reducing the friction, making it easier to access this content while on the road.”
The NAB also maintains faith. “Broadcasters have a franchise on localism; no other audio system on the dashboard replicates what we provide,” executive VP Dennis Wharton told Inside Radio last year. “Keeping our stations in a prominent place on the dashboard preserves radio’s ability to thrive and innovate.”
Still, there is little doubt that significant change is coming soon to the vehicle dashboard, posing a potential threat to radio’s longtime dominance. BI Intelligence says that more than 380 million connected cars will be on the road by 2021. In its report, the research firm wrote, “The market has seen a significant increase in automakers’ plans to connect the majority of the vehicles they sell.”
Roger Lanctot, associate director in the Global Automotive Practice for market research firm Strategy Analytics, said, “It’s true, radio isn’t going away. That’s a non-issue, because broadcasters and car companies will both be able to capitalize on changes in technology.” That said, he added, “Broadcasters need to support digital technology—but many have not done a good job. If they don’t embrace this shift, they won’t benefit from this rising tide of digital technology.”
Jacobs recognizes that the continuing trend of smartphones easily bringing content into the car “will continue to challenge radio’s primacy in the dashboard, forcing programmers to think beyond just competing with other stations in town for time and attention.” Bob Kernen, COO of Jacobs Media sister company jacapps, noted in a webinar last year: “We used to say that a car is a radio on four wheels. Now a car is a 3,000-pound smartphone.”
Based on Fred Jacobs’ conversations with automakers, “we expect these systems to get easier and more intuitive to use”—although, Jacobs said, “Standardization across automakers is still more a dream than a reality.”
And that is where broadcasters have ample opportunities to take advantage of their own increasingly established digital platforms and burgeoning strategies. Lanctot points to “hybrid radio,” an initiative being developed by HD Radio licensor Experi. As part of its Connected Radio project, the soon-to-be platform meshes over-the-air FM radio and IP-delivered content.
“This kind of digital technology has the potential to make radio significantly more interactive,” Lanctot said. “It’s going to be completely different than what anyone is familiar with. The industry is just now bringing these innovations to the market. Fundamentally there will be more interactivity with stations and more visibility to better metrics. I think that’s going to change things, and improve the experience in the car” for broadcasters, consumers and OEMs.
Lanctot is so convinced that the potential of hybrid radio will be a game changer that he added, “I think the Apple and Android dashboard platforms are going to start looking kind of staid, compared with what’s on the way from the digital hybrid radio side of things. I really believe the momentum is about to shift back to the broadcast side.”
For its part, iHeartMedia has long been an innovator in expanding content beyond the airwaves. The radio group’s iHeartRadio streaming service has 100 million registered users—providing access to thousands of radio stations, including many owned by competing groups “to ensure that everyone’s favorite radio station is part of the iHeartRadio app,” said iHeartMedia’s executive VP of Business Development and Partnerships Jessica Jerrick, at April’s NAB Show. The company has presence on 90 platforms, including everything from gaming consoles, mobile phones and wearables to Amazon Echo and Samsung refrigerators. Jerrick refers to such presence as “future-proofing.”
Levin adds, “The iHeart strategy is to ‘provide content whenever, wherever and however the listeners want it.’ We’ve been working with OEMs for more than six years to make sure we continue to be part of the consumers’ journey throughout the day—whether in the digital dash, on their phones, Sonos, xBox, Chromecast, Amazon Echo…you name it, we want to be there.”
The traditional radio industry is well aware that times are changing and that its decades-long dominance in the car needs to be rethought and perhaps reinvented. Edison Research VP of Strategy & Marketing Tom Webster told Inside Radio last month, “Once you have some kind of connected dashboard, whether that’s a native connected dashboard or a Bluetooth connection to your phone, it’s important to have a portfolio approach and to understand that people are assembling their own media diets.”
In the car, consumers “have certain needs,” Webster added. “They need to know the weather and they need to know the traffic. Some need a laugh, some need a little music. The ultimate winner of the in-car playing field is going to be the platform that best allows people to assemble the experience they want to have.”
Laven offers an enthusiastic nod in agreement. “Just because we can, doesn’t always mean we should. Radio reaches 93% of the population because we provide interesting and relevant content for our listeners. We are timely, entertaining and provide a human connection in people’s daily lives. We are home for so many people.”—Chuck Taylor.