The German government has decided to cancel its plans to introduce the "Digitalradio Fördergesetz (DiRaFöG)" mandate, which would have forced vehicle manufacturers to fit DAB receivers into all new cars from 2014. The law would have been a major boost to the DAB market in Europe, and was expected to lead to other neighboring governments taking a more aggressive approach to digital radio transition. However, the German government has decided against the law due to a number of reasons, including the possibility of being accused by the EU of influencing market competition. Instead the government has announced that they will push the EU to introduce policies that ensure harmonization of DAB across all of Europe.
This decision will not affect the current roll-out of a national DAB+ multiplex in Germany, which is now reaching 50% of the population after being launched on the 1st of August 2011. Our contacts within the German broadcasting industry have told us that the launch has so far been a success and that DAB radios are selling faster than before. However, the cancellation of the mandate does mean that growth of DAB in cars will proceed at a slower pace than previously expected and that there will continue to be uncertainty about its long-term prospects as a pan-European standard for digital radio.
French DMB mandate also postponed
In parallel, SBD has learned that the French government has changed its own mandate for DMB radio in cars. Initially the government had legislated that all new cars with radios sold from 2013 should be DMB-compatible. However, this piece of legislation has now been changed to reflect the slow roll-out of DMB infrastructure, which is well behind schedule.
Under the newly revised legislation, the mandate for DMB in cars will only be introduced once a series of criteria have been met. SBD is still investigating these criteria in more detail, but we have been informed that they include requirements relating to the minimum level of geographical coverage of DMB services and penetration of DMB receivers outside of the car.
What does this mean for the automotive industry?
The French decision may come too late for certain vehicle manufacturers, as some have already invested heavily in development costs to adapt their existing platforms and will be unable to cancel contractual obligations to suppliers. Those vehicle manufacturers will undoubtedly be relieved that they will no longer face the threat of a similar legislation in Germany. However, in the longer-term these decisions are likely to cause more headaches for vehicle manufacturers, who will continue to face uncertainty about how quickly they should migrate towards digital radio platforms.
If you would like to find out more about how these decisions could impact your business, please contact Andrew Hart at andrewhart@sbdjapan.co.jp. SBD has recently published two reports that provide detailed insights into both the radio industry and the legislative trends for connected cars:
• The future of Broadcast and Internet radio in the car (analysis and forecasts for the growth of broadcast and internet radio in the car)
• Connected Car Guide - Government edition (a country-by-country interactive guide of upcoming legislation)
If you would like to find out more about either of these reports, please contact Alessio Ballatore at aballatore@sbd.co.uk.
