Mobile streaming is on the rise, but AM/FM remains crucial for in-car advertising

As radio fights to keep its place on a car’s dashboard, new data shows just how important this fight is. While over-the-air radio remains the predominant choice for ad-supported in-car listening, mobile audio habits are also shifting toward streaming services.

Edison Research’s Share of Ear report for the third quarter of 2024 shows that for Americans who listen on their phones in the car, streaming music is the preferred audio source.

For U.S. consumers ages 13 and older, streaming music accounts for 53% of mobile in-car audio consumption, far surpassing podcasts (17%) and original music (14%). Other formats, including YouTube (9%), audiobooks (4%), AM/FM streams (2%) and SiriusXM (1%), account for a smaller share of mobile in-car listening.

This increase in mobile audio consumption comes as the use of cell phones for in-car listening continues to increase. In 2014, 15% of car radio users listened to their phone. A decade later, that number has almost doubled, and 29% of listeners now use mobile devices in the car.

While a 2% share seems bleak, Edison’s latest report also shows that AM/FM takes up 86% of ad-supported audio time in the car, with the share rising to 82% among drivers ages 18 to 34.

The rise of mobile listening brings both challenges and opportunities for radio broadcasters. On the one hand, the 53 percent share of streaming services such as Spotify and Apple Music in mobile listening in the car illustrates the growing preference for personalized on-demand content. On the other hand, the relatively low 2% share of AM/FM radio streams suggests a potential gap in reaching listeners via mobile platforms and the effectiveness of radio stations in promoting their apps.

As automakers move to remove AM radio from vehicles, the risks to broadcasters are becoming increasingly clear. While AM/FM remains the dominant ad-supported platform, drivers may be unprepared to seek out AM/FM streams on their phones when radios disappear into the dashboard.