Christian Müller Industry Analyst 23 rd October 2003 The European In-Car Infotainment Market © 2003 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.

Today’s Presentation 01: Study Scope 02: Market Overview 03: Technology and Market Trends 04: Strategic Impact on Key Participants 05: Key Drivers and Restraints 06: Market Size and Forecasts 07: Competitive Analysis 08: Strategic Recommendations 09: Report Highlights 10: Questions

Study Scope Broken down by OE and Aftermarket and by following technologies Navigation Terrestrial Digital Audio Broadcasting - T-DAB Satellite Digital Audio Broadcasting - S-DAB Multimedia Player CD MD DVD HDD Rear Seat Entertainment Other Infotainment Technologies Compression Formats Mobile Internet Media Downloads

Market Overview Total European In-Car Infotainment market outlook in revenue terms: Source: Frost & Sullivan

Technology and Market Trends Infotainment market appears to always be in growth stage. Navigation Widely available Technology evolving Digital Radio T-DAB S-DAB expected to be launched in Multimedia Player Change to digital media Rear Seat Entertainment Dominated by Aftermarket OEMs start implementation

Key Drivers and Restraints Impact Driver Distraction Agreement Increasing Customer Demand Change from analogue to digital technology Options drive Revenues Short Development Cycles for Consumer Electronics High Margins increase attractiveness Drivers Restraints PLC too Short for Automotive Needs Limited In-Dash Space High Retail Prices Hinder Take-Up Increasing Systems Integration

Market Size and Forecasts Market to grow by CAGR of 15.8% to just under € 6.2bn Euros in 2010 Navigation lower prices for basic systems allow for broader target market Digital Radio dominance of Aftermarket challenged by OE offerings Multimedia Player widely available - move to DVD audio (37.8% in 2010) and HDD (5.6% in 2010) Rear Seat Entertainment increasing adoption by OEMs - MPV and SUV segments mainly

Competitive Analysis Multimedia Player Opportunity for leveraging cost through vertical integration Tier 1Tier 2 Components Rear Seat Entertainment OE Aftermarket Increasing adoption through OEMs Digital Radio T-DAB S-DAB Revenue Opportunities in new technologies Navigation Market dominated by three companies

Strategic Recommendations Include entertainment and information systems in your product portfolio or be prepared to be squeezed out of the market. Prepare for automotive development cycles being longer than consumer electronics or seek some form of collaboration. Push innovation in the Aftermarket and integration in the OE market or be prepared to loose market share. Secure important market share in continuously endeavouring to innovate and to introduce new products. Develop vehicle segment specific products. Be prepared to meet stringent supply requirements by vehicle manufacturers engaging the OE market. Look at joint ventures with consumer electronics suppliers (and vice versa) to maximise development expertise.

Report Highlights Total market forecast for revenues by OE and Aftermarket as well as regions Detailed roadmap and product life cycle analysis Outlook for technology trends by Infotainment technology Individual unit and revenue forecast as well as pricing analysis by technology Detailed profiles and initiatives of prominent value chain participants Implications for key industry participants Strategic recommendations Product Portfolio Analysis Based on extensive primary and secondary research

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