The number of global regulations continues to increase, but the automotive industry has not yet determined which digital radio broadcast regulation will definitely win. In order to be accepted by the automotive industry, the digital radio broadcast format must not only be stable and reliable and suitable for mobile high-speed applications, but also must have active support from the entire digital radio value chain.
Efforts are being made around the world to establish a viable digital terrestrial radio network. Some broadcasting authorities may pay attention to the successful experience of digital radio broadcasting in the United Kingdom and use it as a model. However, for a variety of reasons, the factors that have successfully created the digital broadcasting market in the UK cannot be replicated elsewhere in the world. The British government, in cooperation with the British Broadcasting Corporation (BBC), launched a campaign to announce digital broadcasting, promising the company a digital future and shutting down analog TV broadcasting by 2012. In addition, the British Broadcasting Corporation has made a strategic decision to provide digital-only radio stations to attract users away from analog broadcasting. These digital exclusive channels include music and major sports events. Finally, DAB has no competition from satellite broadcasting in the UK. Broadcasting in the DAB+ format greatly improves the existing service quality of broadcasters, because the original DAB format is relatively inefficient, forcing broadcasters to sacrifice sound quality to output more stations. Another advantage is that DAB+ is based on Eureka 147. Eureka 147 allows DAB and DAB+ to coexist in a single mulTIplex, which will not lead to a decrease in service quality and will not adversely affect the current audience.
Ibiquity Digital Corp. is a licensee of the high-definition (HD) radio broadcasting format. The company told iSuppli about its position in the market and the challenges it faced in delivering HD radio information to consumers, equipment suppliers and automotive OEMs. The company acknowledges that the future success of HD radio broadcasting will largely depend on the broadcast format adopted by the automotive industry's mass market.
Although car buyers can get HD radio in 2007 and 2008, it is usually regarded as one of the options consumers can choose when buying a new car. This requires consumers to determine whether their vehicles require this feature, which has resulted in a relatively low adoption rate. However, the number of manufacturers offering HD radio as part of the standard configuration or entertainment information upgrade package has increased significantly, which has changed the image of HD radio from a niche product to a more mainstream feature. At the same time, iSuppli believes that the merger of Sirius and XM eliminates a lot of uncertainty in the minds of system planners—especially in the automotive industry, and will enable roll-out strategies. Many system planners may have previously shelved these strategies, waiting for the regulator's decision. However, a bigger problem faced by the two satellite providers after the merger is how to maintain the enthusiasm of consumers after the initial free promotion period.
Both Sirius and XM are satellite providers in the United States, and both have a subscription-based service model. The monthly cost ranges from 8 to 13 US dollars, depending on the subscription period and the service purchased. Each company offers 80 to 90 music channels and more than 160 radio channels. After their merger, many of these contents have been integrated into comprehensive programs, and XM and Sirius broadcast similar contents on channels with similar names. Only high-end content such as Oprah, Howard Stern, and Martha Stewart remain separate, mainly due to contractual reasons. Since the satellite digital audio radio service (SDARS) technology is designed to support data channels, Sirius and XM both began broadcasting value-added services that support additional data and telematics platforms. These services involve capturing and sending data to the infotainment system, including stock quotes and weather forecasts, traffic conditions and accident information, images, text, and video. Although from the perspective of subscriptions and operating income, Sirius XM's entertainment content still greatly exceeds its data content, but the data services in the market have expanded significantly.
ONDAS Media is a satellite-based pan-European digital radio company very similar to Sirius XM. What they have in common is that ONDAS has proposed a full subscription-based service with up to 150 music, sports, news and entertainment channels. The suggested data and remote communication services include automotive functions such as CRM, fleet data, and diagnostics. Services also include driver information such as betting, sports and news, as well as enhanced data applications such as traffic conditions and navigation. Digital satellite programs provided by Worldspace include combined content such as news, sports, music, branded content, and educational programs. Some of these programs are developed in-house, and some come from channels such as BBC and CNN InternaTIonal. However, Worldspace is now under Chapter 11 bankruptcy protection in the Bankruptcy Law. Now, the company plans to continue operations to support its 170,000 users in 10 countries in Europe, Asia and Africa. According to media reports, the US media and communications group Liberty Media may be interested in investing in Worldspace. In 2009, Liberty Media helped Sirius XM avoid bankruptcy.
Broadcasting companies agreed to accept AM and FM as the two main analog broadcast formats for radio, almost clearly explaining why these technologies have achieved great success worldwide. In sharp contrast, digital radio is trying to introduce several incompatible specifications, and some specifications have hardly been accepted by overseas regions. Whether the relevant standards can be complied with means that the degree of market fragmentation is large or small. However, the market is at a loss for many norms, and there is no majority opinion in favor of one norm, even if it prefers two standards, which has seriously delayed the establishment of standards. Manufacturers are waiting for market consolidation. In the case of DAB radio, the manufacturer’s biggest concern is that the hardware currently installed in the car may be outdated in the future, because the specifications of these hardware may be determined before the sound quality and broadband inefficiency problems surfaced on the European continent. In contrast, receivers with established specifications can now use the latest technology to make them backward compatible. However, from the perspective of automakers, choosing the right time to join in and support a new technology before the specifications are finalized may be extremely risky.
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