Is Car Radio Going Away?

It's Had Staying Power, but It Has New Challenges Now


  • iHeartRadio

    iHeartRadio

    iHeartRadio's digital radio service is one of the Internet-based competitors that's challenging traditional car radio. | May 15, 2013

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Technologies like the eight-track and cassette player have come and gone in the car, and the CD player is soon to follow. And so far, AM and FM car radio have survived them all. But with Internet radio and streaming music services such as Pandora, iHeartRadio and Rhapsody coming to the car, traditional broadcasting is facing new forms of competition.

"Today it is much easier for any audio content from around the world to find its way into a vehicle as long as the car or its driver is connected," says Thilo Koslowski, an automotive electronics analyst at Gartner. "You no longer need expensive transmitters to get content into the driver's ears. All you need is space on a server and attractive content."

That doesn't mean that traditional AM/FM car radio will go away, Koslowski adds. "But it certainly will no longer be the only option for consumers."

Valerie Shuman, an auto industry consultant, illustrated the current state of radio during "The Digital Dash" panel at the recent National Association of Broadcasters convention by showing a picture of an elephant climbing into a Model T Ford. The point, she said, is that a ton of content is now coming into the car.

"In-vehicle infotainment systems have evolved from traditional radios into much more flexible platforms capable of supporting a host of media, content and apps," she told the audience. Business as usual for broadcasters "is probably not going to be the right answer."

"Every entertainment medium has had to adjust to stay relevant, or the world just moves on to the next thing," says GM spokesman Scott Fosgard. But he pointed out that there are services that Internet radio may not be able to replicate, such as local news, weather and live sports.

"I can't imagine listening to sports without AM/FM or SiriusXM," he says.

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