How serious is Sirius?
Sirius XM’s tie up with AT&T adds value to both the companies. Sirius XM Radio Inc (NASDAQ:SIRI)’s primary purpose is to go beyond providing just a premium audio experience in cars. The company can set any price for the customers to provide its connectivity solution claiming that it gives emergency assistance, self detection technology identifying maintenance need, roadside support and other such services.
Investors are concerned to know if connected cars will actually drive automotive sales and help Sirius XM make money in the long term. Here lies the answer – the company is experiencing a good number of buyers who are interested in purchasing a connected car.
As per a recent research report by Telefonica, almost 90% of cars will be connected by 2020. This means huge business for Sirius XM and AT&T Inc. (NYSE:T) as well, who are jointly working on developing the in vehicle telematics solution. This also suggests that automakers that are preparing to offer connected cars to their buyers, stand to gain as connected vehicles is the future of the automobile industry.
My takeaway
Future Nissan cars will be much more than what they are today. They will possess amazing features keeping customers’ safety as the priority. Nissan buyers are being assured of experiencing a connected journey while safety is assured. Sirius XM Radio Inc (NASDAQ:SIRI) has always tried to offer services that are unique and different, and this time with Nissan, the company is working to develop the universe of its functionality.
All eyes will be set on Nissan cars as it rolls out its models. Which versions or models of Nissan would have these built-in features? What would the price be? For AT&T the risk is the least as this is not core to the carrier’s business. However, if this happens to be successful, the telecom provider would gain another line of solid business. On the other hand, for Sirius the success of this telematic solution and its commitment to Nissan is of much higher importance. How soon will drivers witness the bliss of connected cars is still not announced. However, what remains to be seen is how well this new concept will be received by the masses.
The article AT&T and Sirius XM Working to Convert Nissan Cars Into Smartphones On Wheels originally appeared on Fool.com and is written by Rajesh Marwah.
Rajesh Marwah has no position in any stocks mentioned. The Motley Fool recommends General Motors. Rajesh is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.
