The Death of the AM/FM Car Radio

It is bad times if you are in terrestrial radio. A new report from the NPD Group indicates that people in the US between 13 and 35 spend 23% of the their music-listening time on online-based services. In comparison, terrestrial radio takes up 24% of their music-listening time.

The survey of 7,600 people also found that 62% of those surveyed said that they listened to more online music than last year. 

Last year, online music represented 17% of music listening, and terrestrial radio took up 26% of the time. 

Pandora has the largest share of Internet music listening at 39%. IHeartRadio and Spotify are in second and third place with 11% and 9% respectively. 

The dwindling use of terrestrial radio for music has a major impact on auto manufacturers in the future. The survey found that 20% of online radio users have the service connected in their cars, and NPD did not survey people if they were listening to music stored on a mobile device in their car.

Pandora alone has deals with 20 automotive brands that cover 85 models and seven aftermarket radio manufacturers, and that is not even considering the people who use the Pandora app on a mobile device. 

Expect to see that figure rise even further in the coming years as the price of in-car infotainment systems falls to a level where they can be added to even more models as automakers try to appeal to younger buyers.

Source: NPD