In May 2019, Spotify announced that they were developing “a voice-controlled music and podcast device called ‘Car Thing,’” which was aimed to help Spotify “learn more about people’s listening habits and preferences to help create an unparalleled experience for our users.” The device was projected to look like this and be placed in cars:
We’ve heard nothing about Spotify’s “car thing” until a recent Federal Communications Commission (FCC) filing (January 14, 2021), which gives details and images:
Spotify has always been a purely software company, creating apps for smartphones and computers to play music and Podcasts through a subscription service. But Spotify seems to be venturing into creating hardware with this “car thing” audio streaming device.
The question is: Why? Why create such a device when cars have had bluetooth audio streaming capabilities since the early 2010s? And anyone can easily buy a bluetooth car adapter on Amazon.com for $15 to $25. I used to have a bluetooth adapter in my 2010 Toyota Corolla before self-installing a Sony infotainment system.
Jack Kramer and Nick Martell of Robinhood Snacks have suggested the following takeaway in their January 19, 2021 podcast (with some light edits and emphases):
“Spotify’s biggest growth opportunity is in the car. Let’s go back to first principles: Spotify’s core mission is to become the world’s #1 audio platform. It turns out, it can’t do that unless it conquers the car because according to Pew Research, 91% of Americans are listening to radio every single week. The average American’s commute is 26 minutes, each way. And if you own an old car, your only choice for those 26 minutes is the radio or a CD. Now, the average car on the road in the United States is 12 years old, according to IHS Market. That means that half of the cars on the road in America were made before 2008 — that’s like 80 million cars that are decently old. Half the cars in the United States were around before Uber was a thing. They have no infotainment system, no bluetooth connection, no auxiliary cord, no way to listen to Spotify in the car. So, we’re thinking, if Spotify can make Americans’ old cars finally Spotify compatible, then it could win the millions of people currently jamming daily to WBUZ 99.9, The Buzz.” (13:30-14:52, emphases added)
We can summarize the takeaways from Robinhood Snacks and my own thoughts as follows:
- The average age of most cars in America is 12 years old, meaning that such cars only have radio and CD audio capabilities. Only newer cars (~10 years old) have bluetooth or auxiliary connections that would allow users to listen to music from their phone on their car speakers.
- The average American’s commute is over 50 minutes (although probably less during the coronavirus pandemic because of increased working from home).
- 91% of Americans listen to the radio every week, and since most have older cars without bluetooth connections, listening to the radio and/or listening to CDs are their only options.
- If Spotify were to offer their “car thing” device for cheap (or even free), they could potentially gain new users and/or make it easier for existing users (with older cars) to listen to Spotify in their cars.
- Of course, the objection is that anyone can just buy a bluetooth adapter for $15 on Amazon.com. But, my guess is that Spotify is targeting older users who are not tech-savvy, who don’t even know that bluetooth adapters exist, and wouldn’t know how to install one if they got one (think Baby Boomers and Gen X, those 40+ years old). If Spotify can capture this older group and get them to listen to Spotify in their older cars, that could drive user growth and increase overall usage of the Spotify phone app.
- The “car thing” device will have a screen, so it will actually have more functionality than a simple bluetooth adapter and will be more like the infotainment systems in newer cars, which allow users to flip through their playlists without fiddling with their phones.
Takeaway: Spotify’s “car thing” is an audio streaming device probably aimed at older users with older cars, to make it easier for them to listen to Spotify and to navigate the Spotify app while driving in their older cars.