http://www.slate.com/id/2155114/

Sirius Pain

XM and Sirius could both lose the satellite radio wars.
By Daniel Gross
Posted Friday, Dec. 8, 2006, at 4:37 PM ET

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See article.

 

I'd like to say that's surprising, but it's not. While Sat Radio has its rabid fans, it's a take-it-or-leave-it proposition for most of us. Even though it's "free" for the first year (never minfd that they keep billing me ... see other post), I seldom turn it on. I'm just too interested in local media and keeping up with weather, traffic and local news.

I used it on my last cross-country trip, but only one channel and only part of the time.

I think their only salvation is to start running commercials, and then they look like everyone else. Their only calling card would be that their signal doesn't fade out as you travel, and that they have Oprah (please, God, spare me that). And that would only hasten their death IMO.

Even if they merge, two sick companies don't usually make one big well company.
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I'm not "most of us."

I'm a big fan of satellite radio and can say emphatically that I'm sick of commercial radio and have been for a very long time. It's lousy. I don't listen to it and if at all possible, I don't want it in my car. It's an irritant at best. I didn't buy the RL for the satellite radio and had no experience with satellite radio until purchasing the RL. However, I'm enjoying listening to radio again with its wide variety of content and without the commercials and further without the apparent payola as evidenced by the absolute lack of content and choice of commercial radio.

The satellite feature has been a wonderfully positive surprise for me.

I'm more than willing to pay for the service, and I will not buy another vehicle without satellite radio.

As I previously posted some time back, when XM had to allow clear channel to broadcast commercials on some of the channels, I called and deleted those feeds from my service...I also took out the most rabid of political hate content and in the process completely eliminated one whole category from coming into my personal vehicle.

You must have some really good regional stations where you live, but what I've found in my travels around the Midwest, Appalachia, the Southeast and now Texas hill country, is a vast wasteland dominated by a few commercial radio outfits controlling the programming. The same old, the same old, homogenized and unimaginative programming, peppered with crappy commercials.

 

I was a doubter of SAT radio, and then my wife got me a Sirius aftermarket setup in my '01 TL back in '04. I was hooked, and then got it in my Land Cruiser. We've had a problem with the FM modulater in the Land Cruiser and have been without SAT radio in that vehicle for close to a week, and we've gone through withdrawal. Tahnk god I'm getting it fixed tomorrow.

 

I use mine a lot, both for the traffic and radio. I'm about to pick up one for my Miata. I think the best bet would be for them to merge, but I'm not really up on the health of either. I spend a lot of time on the comedy channels. You just can't get that stuff over the air

 

I never had sat radio until I bought the RL. I love the categories, commercial free, and the quality of the sound is way superior tao FM or AM. Not only is it a digital broadcast but some music that is recorded in DTS or DVD-A is broadcast in that format as well. Since our sound system does not have RDS for FM, the XM radio at least makes up for it. I display radio data in XM all the time. I will definitely renew the subscription when time comes.

 

I was an early adopter of XM and have been using it for close to five years. I even have an XM radio in the house. The radio stations in Cleveland are they typical mass market crap put out by Clear Channel and play the same syncopated pop/rap/country songs over and over and over......

XM has saved me from that. 90% of my in-car music/entertainment is XM. It's the only reason I'm not overly upset about my crappy MusicLink. If it's not music, then it's the news (I'm a CNN/BBC junkie).

I hope XM and Sirius both survive--the competition has increased the quality of both services. To do so, though, they need to find more rabid customers like me.

 

But the fact is that subscriptions to both Sirius and XM total only about 1 1/2% of the U.S. population. That's hardly an overwhelming groundswell of support for it.

The people who like it seem to REALLY like it, while the vast majority of Americans are ho-hum about it. In a nutshell, that's why sat radio is in deep doo-doo financially. Predictions of 50 million subscribers by this year were WAY overly optimistic, and so far they are at a little over 10% of that number according to the latest numbers I've seen.

I still say they'll turn to commercials before they let themselves go under, and that will be a shame. But maybe it's a financial reality. In the meantime, AM radio (of all things) has been growing in popularity by leaps and bounds ... thanks in large part to talk radio, both local and nationally syndicated.
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I think people don't understand the product. I was ho-hum about it as well and probably wouldn't have gotten it if my wife didn't get it for me as a gift. She was at a loss for what to get me for my birthday, and knowing what kind of a techie/car geek I am, she gave it a shot.

Same goes for TiVo/DVRs & even Navigation systems. Most people don't appreciate the product until they've had it. These Satellite companies (and even TiVo for that matter) might need to figure out away to get people to at least try out the product so that they truly understand it.

 

Mike,

I believe that you have hit the nail on the head. XM and Sirius had overreaching goals to increase their subscriptions by a huge amount, while trying to maintain a pricing scheme that would net them millions of $$$s in profit if their plans we realized.

Unfortunately, given the ho-hum attitude of the vast majority, to attract such numbers means they should look at adjusting their subscription rates down, but this might mean making less profit and so it becomes a hard decision to make.

To me, they have one of two choices:

It is very difficult to grow the installed base while maintaining high prices, which seems to be what both XM and Sirius are currently struggling with. I believe it will also be a significant challenge to introduce commercials while keeping the current installed base happy. Dropping prices needs to be carefully controlled, a price war is not good for either XM or Sirius.

Glad I'm not in the satellite radio business

Pete