Cars Adding MP3, DVD, Net Devices
L O S A N G E L E S, Jan. 5, 2001 -- In the good old days, cars were just cars. But with the automotive technology industry expanding rapidly, that four-wheel buggy in the garage may soon earn the title of “multimedia communications vehicle.”
According to industry analysts, the automotive computertechnology market should grow from about $1 billion in 2000 to$8 billion by 2005.
Already, many companies are developing devices to providecars with entertainment, Internet capability, satellitenavigation, satellite radio, and futuristic safety features sothat they look and feel like something straight out of a JamesBond movie.
“We think the market for this technology will be very big,”said Dannie Lau, chief executive officer and co-founder ofPhatNoise, a digital jukebox maker.
On Thursday, Los Angeles-based PhatNoise announced a dealwith Visteon Corp., the second-largest auto parts maker,to license its MP3 jukebox, which will enable drivers to bringmusic from their PCs to the road.
The jukebox, available in March 2001 for select Fordapplications, is an add-on accessory to cars’ existing soundsystems. The jukebox features software that lets users loadhundreds of hours of music stored on MP3 files in theircomputers onto a small cartridge that then goes into the car.
MP3 is a compression format that turns music on compactdiscs into small computer files. The advent of MP3 and Napster,a free and wildly popular service that allows users to swapmusic on MP3 files, has sparked a revolution in the musicindustry in the past year. Demand for MP3 devices in cars isexpected to surge.
People Want Solutions for Computer Music Collections
“Napster has created over 40 million MP3 users. Now thatpeople have these rather large music collections in their PCs,they’re looking for solutions to adapt them to their cars,”said Lau.
Dearborn, Mich.-based Visteon, which was spun off from FordMotor Co. in June, Thursday also unveiled its own MP3player, to be available in late February, that lets driverslisten to CDs they burned on their computers.
It also plans this week to demonstrate various other newsafety, security and entertainment technologies, not yetavailable on the market, in a souped-up vehicle at the ConsumerElectronics Show in Las Vegas.
Delphi Automotive Systems Corp., the No. 1automotive products supplier, is demonstrating satellite radioat the Consumer Electronic Show.
Slated to be available in 2001, satellite radio is arevolutionary new band of radio that will deliver non-stop,digital-quality music and other programming directly viasatellite to vehicles and residences.
Delphi won a multi-year purchase contract in November 1999to build satellite-capable audio systems for General MotorsCorp. that will receive the XM Satellite Radio signal.
Dan Garretson, an analyst with Forrester Research, said hisfirm sees the automotive technology sector growing rapidly,with sales of devices like MP3 players, DVD players andsatellite radios hitting a cumulative 28 million units by2005.
“Half of these will be devices for new cars and half willbe add-ons for old cars,” Garretson said. “The add-on marketwill stay strong because a lot of cars out there right nowdon’t yet have the capability for these technologies,” hesaid.
A Visteon spokeswoman said the company was looking at bothadd-on and stand-alone devices. “Visteon is trying to diversifyand meet all those needs,” she said.
Lau said PhatNoise would focus on the add-on sector, whileits rival U.K. digital audio equipment maker Empeg, which wasrecently acquired by Sonicblue (formerly S3 Inc.) isdeveloping audio devices that replace car sound systemsentirely.
Soniblue’s Rio division plans to introduce Empeg’s productsto U.S. consumers, distributing it widely under the Rio brandin coming months, and intends to develop a wider range offuture Rio car products using resources in both the U.S. andEurope.
The Empeg car player is an in-dash digital music playerwith a capacity of up to 600 hours of high-quality music.