Spotify’s Car Thing Is About to Face the Music9 min read
A year has 525,600 minutes. Matt Suda spent 206,989 of them — more than a third of last year — listening to Spotify.
Suda was one of the earliest customers to get his hands on an invite-only release of Car Thing, Spotify‘s first-ever hardware device, which goes on sale Tuesday. Unlike him, you probably didn’t spend more time streaming music than sleeping last year. But Spotify is betting that Suda and about 140 million of you have something in common: Your car doesn’t have a fancy infotainment system to rival a Tesla’s.
“I was just interested in seeing Spotify’s take on actually building their own hardware,” said Suda, a 26-year-old student in Houston, who drives a 2012 Honda. “I wasn’t expecting a whole lot. But getting the device and using it — you can understand more the problem they’re going after.”
Spotify’s main listening location is the home, but the car is a close second, said Gustav Söderström, Spotify’s chief research and development officer. He says Americans spent an “insane” 70 billion hours a year on the road pre-pandemic. But while roughly 50% to 70% of cars on US roads may be able to connect to a phone, they’re not so fresh-off-the-line as to have an entertainment display that easily streams tunes and podcasts.
To Spotify, that meant drivers in roughly 140 million cars might stream Spotify more — or start paying for it if they don’t already — if a device could replicate Apple’s Car Play or Android Auto for them.
“Why would we do something ourselves here?” Söderström said. “If this already existed, we wouldn’t have.”
Enter Car Thing.
It may look like a bit like a sideways Zune, Microsoft’s failed music player that launched in 2006. But with a credit-card-size touchscreen, mics to pick up voice commands, five buttons and a dial, the $90 Car Thing is a souped-up Spotify remote control for your ride. It mounts to your dash, with the goal of bringing a better way to safely stream music to drivers missing one of those fancy infotainment systems — no dashboard teardown or new car required.
When Spotify first unveiled Car Thing in April, more than 2 million people signed up for its waitlist. The earliest people invited to try it got it free; by fall, people had to start paying $80. On Tuesday, it’s finally going on sale in the US, with a $10 price hike to $90.
Currently, Car Thing works only with Spotify’s premium tier. That means on top of the $90 you pay for the hardware, you also must pay for a Spotify membership. Its standard subscription is $10 a month, though it comes as cheap as $5 a month for students.
So Car Thing is only for Spotify — but only for now.
Its software is on track for an update in “a few weeks” that will unlock it to control other audio apps, Söderström said. If you love Audible, Car Thing will be able to play, pause, skip and adjust volume for your audio books. The update will even allow Car Thing to work for services that are Spotify’s direct competitors. “We want to be an open platform,” he said.
That openness could, eventually, extend to “deeper integrations with potential partners” if Car Thing takes off, he added. While Spotify wouldn’t elaborate on future partnerships, a Car Thing that could toggle between Spotify and Google Maps or Waze would give it the one-two punch of both music navigation and, well, literal navigation.
Broadening Car Thing may be wise, because those 140 million cars may be a more niche market than it seems, according to Tatiana Cirisano, a music industry analyst and consultant at researcher MIDiA. Just 22% of US consumers stream music in the car.
“Streaming services are battling for market share over this relatively small demographic,” Cirisano said.
With sales opening in the US on Tuesday, Spotify is about to start learning: Is Car Thing tapping into a caravan of unmet need for millions of drivers? Or is it driving headlong toward a dead end?
But as vehicles steer toward a future of being more autonomous, anything Spotify can do to solidify itself as the must-have music service in the car may pay dividends down the road.
“Full autonomy is probably the most elusive goal of all, but the dream is: You get into your car and all the windows turn into displays,” said Edward Sanchez, a senior automotive analyst at Strategy Analytics. “That’s what everyone’s salivating at the prospect of.”
Getting to mile one
The concept for something like Car Thing had been percolating at Spotify for a while, but the device’s date of conception might be marked in 2018, when it got its name. First proposed over dinner among a handful of Spotify hardware designers and brand agents, Car Thing was a semi-serious placeholder that the design team adopted for a code name. The name was funny, very literal and a bit childish, said Andreas Cedborg, Spotify’s head of hardware product.
“People think, ‘Hey, you can’t name it like that,'” Cedborg said. “But, yeah, you can.”
Hints about Spotify making hardware for the car soon trickled out. In 2018, some marketing materials made their way to a smattering of Spotify users, advertising a voice-command device you could mount on your dash and pay for as an add-on to your Spotify subscription. Images showed a round device with a lit-up text display with a green circle border. Spotify declined to comment on images at the time, but the company now says it was just a test; it never produced the device pictured.
By May 2019, Spotify came clean it was experimenting with a device called Car Thing. It was different from the device in the leaked test images, but it was also a long way from what Car Thing would become.
The first Car Thing’s screen was too small, its dial too big, Cedborg said. Its green accents, a nod to Spotify’s flagship color, made it stick out from the rest of the dashboard rather than blending in. It also had its own battery, which the current version eschews in favor of a cable that connects to your car’s USB port or 12-volt socket. While a battery would make Car Thing more self-sufficient, freezing temperatures inside a car during winter would ding battery life, and scorching heat with a car baking in the sun risked explosion. A battery also adds weight, making it trickier to mount well.
The Car Thing team’s eureka moment was combining a hat-trick of voice commands, touch screen and physical inputs like buttons and dials. Drivers needed all three, working in concert, they realized. A touchscreen is impossible for typing each letter of a song title while driving, but voice commands handle long titles easily. Yet voice commands are a frustrating way to get to the bottom of a long playlist; a physical dial makes that simple. This three-prong approach was “the user interface that we didn’t see anywhere in the car world,” Söderström said.
After three more years of testing, redesign, user research and pandemic delays, Car Thing was ready for its unveiling. In April, Spotify published a blog post that yes, Car Thing was real. Yes, Car Thing was the name. And yes, it had arrived — sort of. Spotify introduced the waitlist, and people who signed up for it could potentially get it free.
“We just can’t make enough of them,” CEO Daniel Ek said in October about getting Car Things into the hands of waitlisted customers. Progress was crimped by global chip shortages, a problem that halted carmakers’ assembly lines, made Apple’s iPhone 12 launch weeks late and turned finding a Sony’s PS5 game console into a Christmas miracle. (Ek wasn’t available to discuss Car Thing’s US launch.)
But this slow seeding of the device allowed Spotify to gather feedback about Car Thing in the wild, figuring out what needed change or improvement.
The version of Car Thing on sale Tuesday is the same physical device purchased off the waitlist. What’s changed is the software. And the price.
In pricing Car Thing at $90, Spotify is straddling two worlds. On one side, Car Thing isn’t meant to be a revenue engine. Hardware “is a means to an end,” Söderström said. Spotify hopes you’ll pay for its service more so than its hardware. But on the other side, Spotify doesn’t want to sell Car Thing at a loss just to make back the money on memberships. It wants to get Car Thing in as many cars as possible, but it will gauge Car Thing’s success by the new subscribers and higher listening rates from existing members it attracts.
Despite the price hike, Spotify wants to get the price down. The $10 price increase was the result of the rising cost of chips, the company said. One thing that could help bring down price is selling Car Thing, eventually, outside the US, since scaling production can bring down the unit cost of making them. Spotify isn’t committing to international expansion, but there are clear markets where Car Thing could go next, Söderström said, pointing theoretically to parts of Central and South America and Europe.
The company could also pursue bundles and deals that could make Car Thing a stronger value, he said.
Söderström likens Car Thing to the Kindle, Amazon’s hit e-reader. As Amazon’s play to keep Apple from dominating digital books, Kindle was a means to an end, too. When the Kindle first launched in 2007, it was $399. Today, coincidentally, Kindles start at $90, the same price as Car Thing.
Car Thing also comes at a time when Spotify’s public image has been buffeted by drama over its most popular podcast, the Joe Rogan Experience. The debate pits accusations of dangerous COVID-19 misinformation against advocacy of freedom of speech. Spotify declined to comment on the Rogan debate.
Though 2 million on the Car Thing waitlist is a big number, it may have included flocks of people looking to score a freebie and a gaggle who were enticed by the hype around Spotify’s first hardware. Sara Kayden, the marketing lead for Car Thing, says Spotify’s conversion rate — the amount people who actually buy Car Thing when they get off the waitlist — was “healthy,” without specifying further.
The buyer reaction to Car Thing so far runs the gamut. Social media is dotted with both raves and regrets by people who got one off the waitlist. One Redditor mounted Car Thing to his Harley Davidson motorcycle and paired it to his Bluetooth headphones. Before Car Thing, switching tracks or adjusting volume was “nearly impossible” with his phone in his pocket and leather gloves on.
But others have complained Car Thing was overpriced even when it was $80.
Suda, the Spotify power user who scored Car Thing early and free, is still using the gadget every time he drives, nine months later. He’s noticed that Car Thing’s software has gotten zippier. “To me, it just makes it easier to listen and it’s actually safer, if you don’t have CarPlay or any of that fancy stuff,” he said.
In 2019, when Spotify revealed its first iteration of Car Thing, it also brought to light the possibility of a “Voice Thing” and “Home Thing.” It was hardware that never materialized. Still, “it wasn’t vaporware,” Söderström said. “I’ve tried it. But it’s not something we’re launching right now.” Spotify declined to comment on what its next thing in hardware would be. Regardless, they should definitely code-name it Next Thing.
And if Next Thing is ever to become a Real Thing, Spotify must pray Car Thing follows the roadmap of Kindle rather than Zune.
CNET’s Katie Collins contributed to this report.