Smartphones Are The New Pot

June 24, 2010

If you drive a car, chances are good that you own a smartphone, so we feel it's only fair to warn you that you're messing with fire.

J.D. Power recently conducted its 2010 U.S. Automotive Emerging Technologies Study, and the results are clear: smartphones are a technological gateway drug, leading their owners down the primrose path to full-on geekdom. Thankfully, this is not a bad thing.

The J.D. Power study wasn't meant to focus on smartphone users, but analysts did notice some trends -- namely, that a slim majority of drivers (51%) own smartphones, and that they tend to be far more interested in new technology than their peers with non-smartphones (which some have suggested we call "stupidphones", but that's a little harsh so close to the weekend).

Particularly notable is the number of smartphone users who want in-car internet: J.D. Power found that a whopping 77% are jonesing for some web-on-the-go, compared to 64% among all users. Furthermore, 56% of smartphone owners were interested in a mobile router, which is markedly higher than the 46% average.

Of course, that was before J.D. Power's survey-takers discussed the dollars and cents. After pricing of the technology was revealed, interest dropped considerably. Wireless connectivity fell to 51% on average, with the #1 spot taken by "non-branded premium sound systems" (54%), followed closely by "remote vehicle diagnostics" (52%). There's no official breakdown on how smartphone users were affected, but it's safe to assume that their interest shriveled somewhat.

Our take

From where we sit, there are a couple of important takeaways from the J.D. Power survey:

1. Technology won't be attractive -- even to rabid early adopters -- as long as prices stays high. As proof, just think back to the summer of 2007, when the first-gen iPhone launched at a sticker price of $600. Although sales were brisk, many Apple fanboys steered clear until prices dropped into more reasonable territory (about a month later).

Car tech is no different: confronted by high prices, consumers will try to get the biggest bang for their buck -- which may explain why a stereo system rather than wi-fi appeared at the top of the study's post-pricing wish list. Mobile routers from companies like Autonet currently run around $300 or $400, which is perhaps a hundred or two too high for massive adoption just yet.

2. Smartphones change users' expectations of technology. Basic mobile phones are fine for texts, email, and, depending on the network, actual phone calls;  smartphones, on the other hand -- whether they're iPhones, Androids, Blackberries, or Other -- offer many, many more options. As a result, smartphone users don't just become familiar with the technology, they don't just get comfortable with it, they begin to expect it everywhere. And their cars are no exception.

3. Technology is the new horsepower. Okay, we didn't actually say that: Ford design honcho Chiwei Lee did. And clearly, the guy is onto something.

For more info about cars, car tech, and the J.D. Power 2010 U.S. Automotive Emerging Technologies Study, check out the official press release below.

* * * * *

J.D. Power and Associates Reports:

Smartphone Ownership Drives Increased Vehicle Owner Interest in Communication- and Connectivity-Related Features

WESTLAKE VILLAGE, Calif.: 23 June 2010 - As a growing number of vehicle owners migrate from traditional cell phones to smartphones, their interest in key communication- and connectivity-related features for their vehicle has also increased, according to the J.D. Power and Associates 2010 U.S. Automotive Emerging Technologies StudySM released today.

The study is designed to measure consumer interest and purchase intent for emerging automotive technologies, both before and after an estimated market price is revealed.

The study finds that among the 51 percent of vehicle owners who indicate ownership of a smartphone, interest levels for wireless connectivity systems are higher than the industry average, both before and after price is revealed. Before price is revealed, 77 percent of smartphone owners indicate interest in wireless connectivity systems for their vehicles, compared with the industry average of 64 percent. More than one-half (56%) of vehicle owners with smartphones are interested in mobile routers, compared with an industry average of 46 percent. In addition, 47 percent are interested in having an in-dash computer vs. 38 percent industry average.

Approximately 30 percent of smartphone owners indicate texting and checking e-mails while in the vehicle. Among these same owners, nearly 40 percent indicate they would like to have the ability to have e-mails read aloud through their vehicle's sound system, while a similar proportion would like the ability to have text messages displayed on an in-vehicle screen.

"Although several states have imposed bans on drivers using handheld devices and one-half of states have or are in the process of implementing bans on texting while driving, this legislation has not necessarily put a stop to how vehicle owners are manipulating these devices," said Amy Jacobs, manager of automotive emerging technologies research at J.D. Power and Associates. "As a result, vehicle owners-particularly those with smartphones-are still using their devices inside the vehicle and may be looking toward manufacturers and suppliers alike to develop technologies that can enhance, simplify or potentially eliminate the need for unsafe phone usage in the vehicle."

The study also finds the following trends:

  • Nearly 40 percent of vehicle owners with smartphones currently use them in their vehicle to get driving directions. More than one-half of owners with smartphones say they would like to use them to get directions in the future.
  • Approximately 20 percent of vehicle owners with smartphones use their device to listen to music through connection to external or vehicle speakers. However, more than 40 percent would like to do so in the future.
  • The proportion of vehicle owners who listen to external music devices in their vehicle has increased from 2009. Among current portable digital music player owners who listen to their device through the vehicle's speakers, smartphones are the next-most-mentioned device for in-vehicle connection, after portable digital music players.
  • Non-branded premium sound systems garner the highest interest level of the 22 primary technologies examined, once market prices are revealed. However, among vehicle owners who are aware of at least one audio brand, approximately two in five indicate they are willing to pay twice as much for a system branded by a specific supplier.

The study also finds that among the 22 primary technologies examined, vehicle owners exhibit the highest levels of interest before price is revealed for safety-related technologies, with 77 percent indicating interest in blind spot detection and 75 percent indicating interest in an active cornering headlight system.

Once market prices are revealed, non-branded premium sound system garners the most interest (54%), followed by remote vehicle diagnostics (52%) and wireless connectivity system (51%).

Initial interest (before price) Interest after market price is revealed
Blind spot detection 77% Non-branded premium sound system 54%
Active cornering headlight system 75% Remote vehicle diagnostics 52%
Non-branded premium sound system 74% Wireless connectivity system 51%
Navigation system 71% Active cornering headlight system 45%
Rear-vision camera system 67% Rear-vision camera system 45%

The 2010 U.S. Automotive Emerging Technologies Study is based on responses from nearly 18,000 vehicle owners. The study was fielded in May 2010. The study was redesigned for 2010 to include additional primary and secondary technologies; a dedicated smartphone section; key emerging technologies packaging exercise; elasticity analysis; and expanded psychographic and lifestyle-driven content.

[JDPower]

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