Self-Driving Cars Could Add Billions in Revenue to Entertainment Companies
Freed from watching the road, drivers in autonomous cars could instead watch $20 billion worth of video.
While American drivers remain ambivalent about self-driving cars, they are far less conflicted about demanding high levels of connectivity from their personal vehicles.
Now, a new report suggests that combining highly autonomous cars with Netflix-style video streaming could be worth $20 billion to the entertainment industry.
According to a report compiled by Ernst & Young on the impact of the Internet of Things on the media and entertainment industries, Americans spend about an hour a day in their cars, a figure that has climbed steadily over the past 30 years.
"If the focus during that time were to shift from concentrating on the road to watching video," the report stated, "that equates to more than US$20 billion in incremental revenue for the video industry."
Connected cars are already capable of streaming high-definition video. Audi introduced "baked-in" 4G LTE connectivity into its cars in 2014, and General Motors, Fiat Chrysler and other manufacturers now offer the feature. In a test conducted by The Hollywood Reporter, a Wi-Fi equipped Audi A3 streamed multiple movies and videos flawlessly.
The Ernst & Young report estimated that the number of connected cars in the U.S. will grow from 21 million in 2015 to 60 million in 2019. During the same period, automakers are expected to make strides in self-driving vehicles. Mercedes-Benz, BMW, Volvo and Tesla, among others, already offer semi-autonomous driving functions, and Tesla CEO Elon Musk recently hinted that Tesla's Model 3, coming in late 2017, will offer something close to full autonomy, whether or not government guidelines are in place.
Widespread adoption of autonomous vehicles has been estimated would contribute $1.3 trillion to the U.S economy through cost savings from reduced fuel consumption, including $507 billion in productivity gains and an estimated 90 percent reduction in the 33,000 annual fatalities caused by car crashes.