Cars roll into digital future at CES trade show
After taking over the office and the home, the high-tech gadget invasion is now aiming at a moving target.
Doodads for the car--from in-dash DVD players to voice-activated navigation units--are a major item at the Consumer Electronics Show, which kicks off Saturday here.
Sirius Satellite Radio and XM Satellite Radio are making the biggest automotive splash. Both are previewing their services and showing off products for the car.
The companies are targeting the as-yet-unproven market for digital radio signals delivered by satellite. The companies will operate as subscription services, charging around $10 a month and offering dozens of stations in special-interest formats, ranging from string quartets to financial news.
Hugh Panero, XM's chief executive, likens the shift to satellite radio to the move from broadcast television to cable over the past few decades.
"This is the first major advance in radio since the introduction of FM 50 years ago," he said at a press conference here Friday. "It's going to change radio the same way cable...changed television."
Hurdles include daunting start-up costs. Each company will spend more than $1 billion to get off the ground, mostly to launch and position several satellites that will beam programming to subscribers. Sirius has three satellites in orbit already beaming test programming, while XM will launch its first satellite, dubbed "Roll," on Monday. A second satellite, "Rock," is slated to go up next month.
Both companies have worked hard to sign up manufacturers to build receiver units, most of which will go in cars. The units will receive standard broadcast signals and satellite programming from one of the two companies. Units that receive signals from either company are expected in four or five years as the market matures.
The cheapest units--add-on players that allow car radios to receive satellite signals--are expected to go for about $250. Both companies expect to have units on the market by the middle of this year.
Manufacturers exhibiting XM-compatible players here include Sony, Alpine and Pioneer. XM-compatible radios will also be an option in select 2001 models of General Motors cars. Sirius manufacturing partners include Alpine, Kenwood, Panasonic and Jensen, while automakers such as Ford Motor, Volvo, BMW, DaimlerChrysler and Mercedes will offers Sirius radios in some cars.
But perhaps the biggest hurdle will be convincing consumers to pay for something so similar to a service they now get for free. To do that, both companies will spend millions on advertising campaigns touting the CD-level sound quality of satellite radio, the variety of formats, and a nationwide signal that doesn't fade out in remote areas.
"People used to say, 'Who's going to pay for television?'" Panero said. "The bottom line is that if it provides value, people will pay for a service."
Panero cited analyst reports estimating that satellite radio will have 40 million subscribers within five years, split between the two services.
The most apparent difference
between the two services will be commercials. All Sirius channels will be commercial-free, while the majority of XM channels will have a single sponsor inserting six minutes or so of commercials into each hour of programming, compared with an average 20 minutes per hour for prime-time broadcast radio.
Panero returned to his favorite analogy to defend the approach. "We believe in having dual revenue streams," he said. "That's really what's made cable television successful."
Following were other automotive developments at CES:
• The Eclipse subsidiary of Fujitsu showed off Commander, a voice-activated system that allows drivers to use a cell phone, Global Positioning System navigation unit and DVD movie player (for back-seat-only viewing, please) by talking to the dashboard.
• Audiovox touted luxury systems, including a mobile DVD outfit that includes a 13-inch monitor that drops down from the roof and a "prestige" car alarm with a controller that looks like a cell phone and works from as far away as 1,500 feet.
• Alpine has a tilting, swiveling 7-inch LCD monitor that mounts in the dashboard for viewing GPS mapping information and DVDs. But please wait until you're safely stuck in gridlock traffic before turning your attention to that bootleg copy of "Dude, Where's My Car?"
• For low-tech fun, Ichiban Motorsports offers a full line of fashion-forward shift knobs, dipsticks and parking brake handles.