Digital Satellite Radio Forecast To Grow - InformationWeek

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10:03 AM

Digital Satellite Radio Forecast To Grow

While 23% of online consumers surveyed reported an interest in satellite radio, only 6% have it, Jupiter Research says.

The U.S. digital satellite radio market is expected to grow from 12 million installed units this year to 55 million units in 2010, according to a new report.

Jupiter Research announced the 35 percent compound annual growth rate Tuesday. While 23 percent of online consumers surveyed reported an interest in satellite radio, only six percent have it, according to Michael Gartenberg, vice president and research director at JupiterResearch.

The report, "U.S. Satellite Radio Forecast, 2005 to 2010" states that in-car device sales will grow from 2.5 million units sold this year to 6.9 million units in 2010.

Sixty-six percent of sales this year are in transportable devices--both plug-and-play and handheld units. The trend will continue through 2010 when 60 percent of sales are forecast to come from transportable devices.

"Transportable devices will lead the installed base mix with sales being driven by wide device selection and lower price points," Gartenberg said in a prepared statement. "However, in-vehicle interest has been strong."

The report points out that cell phones present lucrative opportunities for taking advantage of fast wireless networks to offer existing Internet streaming services to existing and new customers.

"The signing of big deals, such as Howard Stern and Major League Baseball, has raised the stakes for XM Satellite and Sirius, even beyond the initial capital outlays for satellites and subsidized hardware," JupiterResarch Senior Vice President of Research David Schatsky said in a prepared statement. "The primary challenges for Sirius and XM are price and competition with other portable media players and music services, such as iPods and iTunes, respectively."

Another survey, by Ports North Group and Horowitz Associations Inc. shows that customers are getting used to the idea of television on their mobile phones.

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