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Old 08-05-2003, 01:09 PM   #1
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Default Consumer Electronics article


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Digital and Satellite Radio Sound Good for Audio Manufacturers and Retailers
CEA Survey Finds Consumers Very Interested in Special Features Offered by

Arlington, Virginia 8/4/2003

In some positive news for audio manufacturers and retailers, new research from the Consumer Electronics Association (CEA) shows consumers are a captive audience primed for many of the benefits satellite radio has to offer. CEA's survey found that most consumers (94 percent) listen to the radio in their cars, and the majority of those (67 percent) believe the sound quality of their radios is not as good as that of CDs. According results of the March 2003 survey, consumers also are attracted to the ability of digital and satellite radio to display a variety of data such as song title and artist, traffic reports and, especially, weather updates.
The study found that while gender has no effect on one's interest in digital radio, age has a significant impact. Consumers in the 18-34 age group show a greater interest in digital radio than those 35 and older (69 percent vs. 56 percent). Forty-nine percent of consumers reported that they are somewhat or very interested in satellite radio that could provide CD quality sound. Women show more interest in satellite radio then men (51 percent vs. 46 percent). As with digital radio, interest in satellite radio declines with age. Interest level among 18-34 year olds outpaced that of 55+ year olds (63 percent vs. 38 percent).

"This study shows that there is significant interest, and a very specific market demographic which is primed for digital radio and satellite radio services," notes Sean Wargo, CEA senior market analyst. "This is a very new industry, but clearly manufacturers and retailers can tap into an already existing group of consumers."

The study found that in addition to improved sound quality, consumers also are somewhat or very interested in the technology's ability to display information, including weather reports (62 percent), traffic updates (51 percent), and song title and artist (50 percent).

Wargo adds, "The challenge for satellite radio will be selling consumers on the notion of paying for radio, since many consumers (51 percent) said they would not be willing to pay the extra fee for satellite radio service. However, history has shown through the launch of cable TV in the 60's, consumers will pay more to receive access to higher quality and greater choice." To meet that challenge, some companies are exploring a wide range of other services to offer via addressable satellite radios such as remotely unlocking a car, remotely starting the engine and delivering customized data.

Digital and satellite radio are relatively new to the consumer electronics industry; in November 2001, XM Satellite launched the first satellite radio service, soon followed by Sirius Satellite Radio in February of 2002. Since the launch of these services, CEA has tracked factory-to-dealer sales of more than 600,000 units of satellite radio modulators in the aftermarket alone, bringing nearly $100 million in revenue to the industry. In early 2003, just one year after the technology's launch, WDMK-FM in Detroit, Mich. became the first ever radio station to broadcast in digital.

About Consumer Research/eBrain:
Data cited in this release came from reports designed and formulated by eBrain Market Research. eBrain Market Research is a full-service market research consulting firm. It was started by the CEA Market Research Department in 1998. For a list of available reports and purchasing information, visit or send an e-mail request to

The quantitative study for Digital and Satellite Radio Mini Study was administered via internet web form to a representative online sample of 1160 U.S. adults during March 2003. eBrain Market Research is responsible for all content and analysis in the report.

About CEA:
The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships. CEA represents more than 1,000 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $85 billion in annual sales. CEA's resources are available online at, the definitive source for information about the consumer electronics industry.

CEA also sponsors and manages the International CES - Defining Tomorrow's Technology. All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.
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