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Emerging Technologies - Satellite Radio - USProduct Type: Market Research ReportPublished by: Mintel International Group Ltd. Published: July 2004 Product Code: R560-1210 Description While the concept for satellite radio began development in the early 1990s, consumers were not introduced to the technology until 2001. Since that time, satellite radio has grown as a result of the efforts of two firms-XM Satellite Radio and Sirius Satellite Radio. Both firms were scheduled to launch in Fall 2001, but Sirius was delayed for eight months due to chipset conflicts. Total industry subscription sales reached $91 million in 2003, and are expected to reach $227 million in 2004 and $3.1 billion by 2009, according to Mintel estimates.
XM announced in the second quarter of 2004 that it had amassed 2.1 million net subscribers. While Sirius had not released 2004 second quarter data during the review period, first quarter net additions for the company in 2004 totaled 91,000 subscribers. While Sirius has gained a significant stake in the market, XM remains the strongest player in the market, adding 320,000 in the same time period. In late July of 2004, XM and Sirius reported approximately 2.1 million and 500,000 subscribers respectively, bringing the total market to 2.6 million subscribers. Market shares in the satellite radio market frequently fluctuate from quarter to quarter. Table of Contents INTRODUCTION AND ABBREVIATIONS Introduction Other relevant reports Definition Satellite radio channel definitions Abbreviations and terms Abbreviations Terms EXECUTIVE SUMMARY The satellite radio market Collaboration and innovation have fed market development Future relies on critical mass of subscribers XM leads, but Sirius is following strong What's ahead MARKET DRIVERS Introduction Broad content is key Narrowly defined station formats spark consumer interest Satellite radio is an ongoing investment for consumers Figure 1: Subscriber data collected by XM: self-reported income of XM subscribers, 2003 Additional customers come at a cost Figure 2: Cost per gross addition, 2002-2003 Attracting and maintaining the confidence of marketing partners is crucial Figure 3: Number of manufacturer partnerships, 2004 Satellite radio and competitive content formats Figure 4: Online activities in the last 30 days, 2003 MARKET SIZE & TRENDS Figure 5: Total U.S. subscription sales of satellite radio, at current prices, 2001-2004 MARKET SEGMENTATION OEM, retail and rental car segments Figure 6: Net subscriber additions, segmented by channel, 2002-2004 OEM Figure 7: Net OEM subscriber additions, 2002-2004 Details on the OEM Segment Retail Figure 8: Net retail subscriber additions, 2002-2004 Details on the retail segment Rental car Figure 9: Net rental car subscriber additions, 2002-2004 SUPPLY STRUCTURE Introduction Figure 10: sales of satellite radio service in the U.S., by manufacturer, 2002 and 2003 XM Satellite Radio Sirius Satellite Radio ADVERTISING AND PROMOTION Figure 11: Marketing expenditures for XM and Sirius, 2001-2003 Strategic partnerships Figure 12: XM and Sirius strategic partnerships, 2004 Sirius XM RETAIL DISTRIBUTION Introduction OEM Figure 13: Satellite radio auto maker partnerships, 2004 Electronics stores and other retailers Figure 14: Where car audio equipment was purchased, April 2003 Supplier partnerships Figure 15: Satellite radio hardware manufacturer partnerships, 2004 THE CONSUMER Introduction Early lifecycle portable electronic products (ELPEP) Satellite radio subscribers Figure 16: Incidence of owning a satellite radio or at least one ELPEP, May 2004 Figure 17: Incidence of owning at least one ELPEP, by gender, May 2004 Figure 18: Incidence of owning at least one ELPEP, by age, May 2004 Graph 1: Incidence of owning at least one ELPEP, by age, May 2004 Figure 19: Respondents who own at least one ELPEP, by household income, May 2004 Graph 2: Respondents who own at least one ELPEP, by household income, May 2004 Figure 20: Incidence of owning at least one ELPEP, by race/ethnicity, May 2004 Graph 3: Incidence of owning at least one ELPEP, by race/ethnicity, May 2004 Figure 21: Incidence of owning at least one ELPEP, by household size, May 2004 Figure 22: Incidence of owning at least one ELPEP, by presence of children, May 2004 Consumer use of satellite radio and ELPEPs Figure 23: ELPEP length of ownership, May 2004 Figure 24: Hours per week listening to satellite radio and MP3 players, May 2004 Overall product experience Figure 25: Overall product experience, May 2004 Intended satellite radio purchases Figure 26: Technology adoption status of consumers, May 2004 Figure 27: Early adopters and early majority consumers, by age, May 2004 Figure 28: Early adopters and early majority consumers, by household income, May 2004 Figure 29: Incidence of intention to buy an ELPEP in 2004, May 2004 Figure 30: Incidence of intention to buy an ELPEP in 2004, by age, May 2004 Graph 4: Incidence of intention to buy an ELPEP in 2004, by age, May 2004 Figure 32: Incidence of intention to buy an ELPEP in 2004, by race/ethnicity, May 2004 Graph 5: Incidence of intention to buy an ELPEP in 2004, by race/ethnicity, May 2004 Summary Current owners Early adopters and early majority consumers Intent to buy ELPEP and satellite radio in 2004 FUTURE & FORECAST FUTURE TRENDS Expansion of offerings Evolution in OEM offerings Convergence of AM/FM with XM and Sirius in aftermarket stereos MARKET FORECAST Overview Figure 33: forecast of U.S. subscription sales of satellite radio, at current and constant prices, 2004-2009 XM subscription sales forecast through 2009 Figure 34: forecast of U.S. subscription sales of XM Satellite Radio, at current and constant prices, 2004-2009 Sirius subscription sales forecast through 2009 Figure 35: forecast of U.S. subscription sales of Sirius Satellite Radio, at current and constant prices, 2004-2009 Changes in the forecast APPENDIX: CASE STUDY OF THE MARKET FOR CABLE TELEVISION Figure 36: Cable television penetration, 1970-2004 APPENDIX: TRADE ASSOCIATIONS APPENDIX: RESEARCH METHODOLOGY Consumer Research Sampling & Weighting Presentation & Definition Further Analysis Trade Research Informal trade research Formal trade research Desk & Internet Research Sources Definitions Forecasts APPENDIX: WHAT IS MINTEL? Mintel Publications Mintel Services Product retrieval Retail audits Tailored research Global New Products Database Research Support/Consultancy/MIC The Mintel Information Centre (MiC) PR Research |
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