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No Radio in Tesla Model 3: Time for a Mandate

by Roger Lanctot | Oct 04, 2017

There is a soccer chant crafted by Manchester City fans in the United Kingdom seeking to cast shade on fans of Liverpool FC by suggesting that the latter are inclined to criminal behavior. The chant intones “Where’s my car stereo?” to the tune of “La Donna e Mobile.”

This past week followers of Tesla Motors were asking the same question, with equally larcenous implications, as an online video published by The Verge purporting to show a Tesla Model 3 customer orientation appeared to demonstrate that Tesla had left AM/FM radio out of its new cars. Consternation regarding this video was expressed and shared by Fred Jacobs, co-founder of Jacobs Media and a radio industry maven, and seemed to be confirmed by a report in The Drive.

http://tinyurl.com/ybsku4ms - “Here’s Our Closest Look at the Model 3 Touchscreen Yet” – Thedrive.com

http://tinyurl.com/yblemvrh - “Tesla Model 3 Currently Leaves Drivers without FM Radio, Bluetooth or USB Audio” – Theverge.com

Thankfully, Fred gave a heads up to the National Association of Broadcasters (NAB), which reached out to Tesla thereby discovering that broadcast FM radio was available in the Model 3, though AM had been deleted. This is reminiscent of BMW’s similar decision, two years ago, to delete AM reception from its i3 and i8 electric vehicles due to signal interference.

(Clarification: Indications are that the hardware necessary to support FM reception in Tesla Model 3's is in place. The software and user interface required to deliver the solution is intended to arrive via over-the-air software update - timing unclear.)

The deletion of AM radio in the Tesla Model 3 highlights the crisis confronting the radio broadcast industry. It also casts a spotlight on Tesla’s unique relationship with its customers. In summary:

·       Musk’s way: Tesla’s unilateral decision to delete AM radio from the Model 3 reflects the company’s my-way-or-the-highway approach to product decisions. This approach is reflected in everything from Tesla’s adding, removing then restoring automated driving, to the different kinds of streaming or broadcast content in its cars and the lack of smartphone integration – sorry, no Pandora or Spotify. Tesla CEO Musk giveth and Musk taketh away – with software updates or with expensive out-of-reach technology that can be turned on (or off) remotely for a price.

·       Radio advocacy: The lack of radio industry advocacy on behalf of preserving radio’s position in cars for a wide range of purposes from delivering emergency messages to offering non-distracting entertainment, news and weather information. There is arguably a public interest in ensuring that every car is equipped with radio reception – at least FM – yet there is no requirement. That may be a good thing…or not.

·       Consumer outrage: There appears to be no avenue for consumers to complain or advocate on behalf of access to broadcast radio in the car.

·       Streaming limitations: It appears from the customer demo (above) that not all local broadcasts are available via Internet streaming – meaning streaming is not a substitute for free over-the-air broadcasts – i.e. if the cost of wireless was not an issue.

The confusion regarding what appeared originally to be Tesla’s complete deletion of radio reception raised the specter of cars without radios. This directly parallels the ongoing battle between Apple and the broadcast industry. The NAB and FCC continue to “ask” Apple to turn on the FM chips in its phones – something most carriers offering Android phones have already done.

Tom Taylor reported (in his daily industry newsletter Tom Taylor Now) FCC chairman Ajit Pai’s comments mid-week “’I have repeatedly called on the wireless industry to activate FM chips…and I’ve specifically pointed out the public safety benefits.’ He says ‘in my first public speech after I became Chairman [in January], I observed that ‘you could make a case for activating chips on public safety grounds alone.’ Pai says ‘I applaud those companies that have done the right thing…Apple is the one major phone manufacturer that has resisted.’ He says ‘It is time for Apple to step up to the plate. And put the safety of the American people first.’”

Innovation is sweeping the broadcast radio industry from the momentum building around HD Radio to new hybrid radio technology from NextRadio, Radioplayer and RadioDNS. HD Radio technology – currently shipping in 44% of new cars in the U.S. – enables a greater variety of content available free over the air from existing broadcasters.

Tagstation technology, the provider of NextRadio, allows for audience measurement and advertising campaign assessment in near real time – compared to the weeks-long lag time of Nielsen. Together, HD Radio and NextRadio are expanding the scope and impact of broadcast radio, which continues to be the content delivery channel with the widest reach of all, according to multiple sources.

Xperi, the former Tessera which acquired HD Radio pioneer iBiquity, has crafted a global digital radio platform offering a single API integrating multiple global digital radio formats onto a single platform. In essense, Xperi has distilled the global digital radio innovation of the entire industry into a single API capable of delivering album art, artist information, POI and advertiser locators, searchability and a station guide. 

This is no time to be deleting radio. 

The Xperi solution highlights the reality that not all broadcast stations are available online and not all stations have made the digital plunge. Making matters worse, the NAB, caught in the headlights of a mass audience defection to digital platforms, refuses to take a stand on its U.S. members prioritizing a shift to digital broadcasting.

This is no time to be polite. Any reticence at NAB regarding the adoption of digital is nothing short of suicidal for the wider industry. Spectrum is expensive, but it is worthless if listeners can’t find it.

The “can’t find it” proposition is increasingly becoming reality as drivers connect their smartphones and turn on Apple CarPlay or Alphabet’s Android Auto cutting themselves off from the free over-the-air broadcast. Strategy Analytics customer clinics repeatedly show that even drivers that want to exit CarPlay or Android Auto to access the local radio signal are unable to do so. (It is worth noting that the user interface in the Tesla Model S was easier for radio enthusiasts to navigate than the new Model 3, which appears to obscure the radio access.)

The idea that Tesla might delete AM/FM radio from its cars has created the impression that radio is somehow old fashioned or optional. The reality is that radio is vibrant and continuing to offer a platform for innovation.

Tesla does offer streaming alternatives to radio in the form of TuneIn radio and Slacker. The company is also rumored to be in talks with major labels around the potential for a Tesla-branded streaming service.

The bottom line is that radio is likely to remain in dashboards indefinitely – no thanks to the existence of either a mandate or effective consumer or industry advocacy. It’s time for car makers and broadcasters to embrace HD Radio in the U.S. (and DAB in Europe and elsewhere) to tap into the advanced content access and management aspects of digital radio along with the superior audience measurement opportunity.

In light of the ongoing dashboard conflict created by smartphone integration solutions from Apple (CarPlay) and Alphabet (Android Auto) that make it harder for consumers to find or switch back to the radio, the broadcast industry needs to do more to communicate the importance of radio to car makers and the makers of devices ranging from digital assistants to smartphones and tablet computers.  If we’ve learned nothing else from the recent hurricane season, we should recognize that in most circumstances when all else fails, radio gets through – to the biggest audience and with the most immediate impact. They’re not streaming Slacker in Puerto Rico.

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