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The fledgling in-car satellite TV market appears to be gaining momentum, especially as suppliers lower prices.
KVH Industries of Middletown, R.I., one of the few existing in-car satellite providers, recently lowered the price of its TracVision A5 which resulted in sales tripling at one of KVH's key outlets, Tweeter Home Entertainment, according to Tweeter.
KVH also recently launched a print, TV and radio campaign and will soon be joined by a second aftermarket supplier, Winegard, of Burlington, Iowa, which expects to release the RoadTrip XL at the SEMA show in November at a price tag $1,000 lower than originally planned.
While the market today remains a tiny niche, suppliers and retailers say it has the potential to win broad appeal if prices drop sufficiently.
“It's a category that I think will continue to grow,” said Dan Jeancola, mobile electronics VP for Tweeter, noting it has been a hit with early adopters. “The nice thing about it is the attachments,” he added. “When you sell one of these things, it's not like a DVD or flip-down monitor. These people are attaching audio and video and these end up being $10,000, $12,000, $20,000 systems.”
Jeancola said that after KVH dropped the price of the TracVision to $2,295 from $3,500 in July, sales tripled in August, but he said football season may also play a role in the spike. “This is a big tailgating thing. The guys that have these on their vehicles are the hit of the game.”
Kenwood said of the category: “Right now it's an extreme niche market, but it's exciting for early adopters, which is good for our industry. It's an indicator that it could be a growth category,” noted Keith Lehmann, Kenwood's sales VP.
KVH launched last September its TracVision A5 with a slim-line antenna, making it feasible to offer satellite TV on a typical car. The company said it shipped 1,700 units in the first few months but would not give updated sales figures for 2004.
Winegard, the 50-year-old antenna maker, announced plans to ship a similar slim-line antenna/receiver package at CES in Jnauary, but delayed the unit. The company said the postponement was to enable the new unit to receive both DISH Network and DirecTV satellite signals. The current KVH model receives only DirecTV. The new version, designed for SUVs and minivans, is expected to ship around November at a retail price of $1,999.
KVH's new ad campaign, launched in early August, targets magazines such as Newsweek, Business 2.0, Forbes, Fortune, Golf Magazine and several in-flight airline magazines. In Florida and Texas, KVH also launched a radio and billboard campaign.
KVH also recently announced a special subscription package for current DirecTV subscribers, called Choice Mobile. It allows current subscribers to add their car receiver for only $4.99 per month. Non-subscribers must pay $39.95 for satellite service.
Winegard said it does not have formal agreements for a “mobile subscriber packages” with satellite providers, but noted that its system accepts both DirectTV and DISH Network smart cards, which simply recognize the mobile unit as another receiver. A Winegard spokesman explained, “Additional receivers are only $4.99, whether they are in the home or the car, if you are a current subscriber.”
Both Sirius Satellite Radio and XM Satellite Radio demonstrated the capability to offer satellite TV to the car at CES. Sirius said it is currently in talks with car companies about offering the product.
XM Satellite Radio said it is waiting to see if there is a sound business model and demand for the service. However the company will launch an in-car satellite navigation service this fall with Acura, to be offered on other vehicles, including aftermarket vehicles, in the future. The service, called XM NavTraffic, displays real-time traffic. Icons, colors and data points on the map display screen depict traffic situations on roads which the user can select.
Delphi said it is capable now of providing satellite TV hardware but there are no immediate plans for an aftermarket product. “It depends on how fast we can bring the price point down,” said a spokesman.
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