Wednesday, April 5,2006 @ 1:30pm
Car makers ignore iPod market
A new study shows that 47 percent of new car buyers across the U.S., U.K., Germany, and France already own an iPod or other MP3 player, and that 35 percent are planning to buy a digital music player within the next year. Despite this, 48 percent are uninterested in an iPod interface when they buy their next new car. Over a third of new car buyers who own MP3 players want to play their MP3 music collection through the car audio system, and although burned CDs are the most preferable method for bringing digital music into vehicles, 36 percent want to connect their MP3 player with their car audio system. Aside from regional differences, overall demand for playing in-vehicle MP3 music is very strong across the US and Europe, according to the Strategy Analytics automotive consumer report.
"Our survey shows that there is a major gap between demand and supply. Just as we've seen with portable navigation, car makers are again running the risk of delivering a major automotive opportunity gift straight to the aftermarket suppliers. Aftermarket MP3 solutions start at around $50, whereas car maker solutions start at hundreds of dollars and, generally, OEM availability and promotion of automotive digital music solutions is extremely poor," notes Joanne Blight, director in the automotive practice.
"If car makers react quickly by launching MP3 connectivity in the correct target car models, set attractive price points, and promote the benefits of having integrated solutions," she concludes, "significant new revenue streams can stay with the manufacturer, rather than being passed directly to the aftermarket vendor."