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Satellite Radio in Fiscal Trouble
prostoalex writes "It looks like Sirius Satellite Radio is going through its worse times. From the same article XM Satellite does not seem to be doing well either, even with 200K customers. Will it signify the end of the satellite radio?"
That may be the case, but it's probably not a good enough biz model to sustain them. What they ought to think about doing is providing a large commercial-laden offering for free, and a "premium" offering for money. That way the business is sustained by a large enough revenue stream (advertising) and those who want the indie stuff can still get it, but it costs them more. 200k customers may seem like a lot, but think about the amount of money they must be paying to run the service.
Key to financial independence: Spend less than you earn. Save and invest the difference. Do it for a long time.
Recall, it was another idea conceived while the bubble was growing. Assuming they survive the downturn, and I really do hope they do, they should do fine. Imagine GM, Ford or Chrysler gearing up assembly lines for bigger cars with bigger engines, just as the arab states realized they could gouge for petroleum (~1973) A shock to the system, but it didn't kill them, even while Honda and Toyota were eating their lunch.
A feeling of having made the same mistake before: Deja Foobar
According to the recent New Yorker article on Willie Nelson, he loves satellite radio which lets him listen to a few of his musical inspirations (in cluding Frank Sinatra). But how many of us really are on long drives in tour buses with drivers?
I'd like to see them offer programming from other countries. Give me a feed from the Australian Broadcast Company, or the BBC, even plug in the Voice of America stations (if they allow that now) to hear what we're telling other nations about ourselves. Let Grandma listen to radio from the 'old country'. I love listening to radio stations on the net now and I think to have *that* in your car to listen to would be more a great selling point.
1. The quality sucks (96kbps... yummy)
2. You're still limited to the formats of your local stations, which means limited choice and lots of commercials.
The only thing they've added is shitty digital sound... how exactly is that going to kill satellite radio?
"And like that
- BBC World Service
- Fox News
- CNN Headline News
- ABC News and Talk
- The Weather Channel
- CNBC
- CNNfn
- Bloomberg News
- CNET Radio
- C-SPAN Radio
These are services that you can't get on the radio in 99 percent of the country, unless you use satellite radio. How many people will pay for this? Not many, but, this is probably another vertical market similar to over-the-road truckers.I haven't bought an XM receiver because I don't think the service will survive in its present form, and I don't have the disposable income that I had prior to the recession.
I haven't seen this posted elsewhere in this discussion, but an AM radio station in NYC has already brought HD-Radio on-line. This is interesting because I don't know of any receiver I can buy the handles this service at the moment. If HD-Radio doesn't add to the programming options we receive, however, no consumer will care about it. Then, IMHO, all it will be is a long-term way for the broadcasters to reduce transmission costs.
-- Dave Aiello
I totally agree with you. If the upfront costs were just $399 and no monthly fees then I would serious consider it. With monthly fees, lets say $10, there receiver should be leased or given to you for free (under 2 year contract or something). the onyl way I would pay $399 for the receiver and a $10 service fee is it was portable (like an over sized cd player). This would give me the ability to hook it up to my home receiver and carry it around as a diskman. Perhaps even throw ina compact flash card port in there to save your favorite song when playing.
Just my personal thoughts. Any comments?
NO! NO! Please don't mod me, I'm too young to die a troll. *click* Oh the pain, the pain...
1. I live in country, no large GOOD radio stations.. And since I'm in the country I'm always in my car
2) I have a 30 minute commute, listen to traffic for 5 mins then have 25 more minutes to listen to good (and honest to god) NEW music without having some idiot rattle on and on about what they are playing..
3) Since I'm in the country all my friends live atleast 30 mins to 1 hour away.. not exactly long trips but the XM radio makes them go alot quicker.
4) I have a fairly large music collection myself at home and yes, even some MP3's I downloaded.. Secondly I don't have digital cable because I'm really thinking it's a complete rip off.. Something along the lines of 50 Bucks for the same old crap on normal cable BUT with music channels (I get the music channels on XM for a lot less).
There yah go.. This here hick boy really enjoys listening to the music I want to when I want to.. I can tune in on 3 different types of trance/techno music and also listen to Alternative with a quick flip of the button.. It's all relative and I suggest keeping a slightly more open mind.. never know when you'll get fired and have to move out in the good ol' country...
The radio stations only play what they are paid to play. If I want to hear "new" music, I listen to live music.
I signed up a couple of weeks ago and have not listened to local radio since. Clear Channel (owns more that 1600 stations) has destroyed local radio by programming the same 50 songs on whatever format they own. In addition almost every station syndicates the same mindless drival morning talk shows. Sirius frees you from this which is the real reason for spending the money to get it. Hopefully more people will realize this is the true reason for getting Satellite Radio. (Sirius would seem to be better than XM)
Well Delphi's New SkyFi (sorry don't know a direct link)goes a long way to reducing costs... The receiver is only $169.99 (retail) with the car mount... meaning with a basic antenna it's about $200 to get started with XM radio...
I have a existing XM receiver/antenna/car mount & it pales in comparison to the Delphi SkyFi... Oh & you can get a home audio mount that lets you take the receiver in to your house to use with your home stereo system....
we are all invisible unless we choose otherwise
My biggest gripe is that they (presumbably) knew about each other and yet didn't try to make a standard. So for example, my Kenwood head unit is Sirrius ready but if I wanted XM my head unit would not work with it (I'd have to have a seperate display, buttons, etc.). I have yet to see any car radios that support both Sirrius and XM and for me, I'd like to have a choice.
Another gripe is the antennas. Right now (at least for Sirrius) there is mainly just one antenna made by several companies. I'd prefer a little choice here too...like stealth antennas, antennas you could put on the inside of the rear window, etc. I know visibility, etc. is a concern but I think they could solve any issues there.
And speaking of visibility, I wonder how these radios perform in a thunder storm?
//m
I seriously considered one of these systems. Here are some of the reasons I didn't buy one.
Conflicting Standards - It is the norm in the electronics industry to come out with multiple formats in the hope of locking the users into your service. This is true of the Satelite radio services. So, once I buy a radio I am stuck with either the service I originally chose, or a large $500 hockey puck.
Can't Try-Before-Buy - I can't try before I buy, instead I have to shell out 300-500 buck-a-ronis and then pay a monthly fee - all to find out if it is worth having.
Fear of Bankruptcy - Even if I love my new stations, if my particular service goes belly up, my pre-paid time is lost, my radio turns into the hockey puck, and I am out of luck. In this business climate, it is a very real consideration to me.
Fear of Declining service - once they have you, they have you. If they need to actually make money, or failing that, loose less, the first thing to go will be the DJ's. And then all you will hear is the same songs over and over, programmed by Mort (you know, the guy who was once an assistant to the Manager for one of those 80's bands that you kinda recognize their song when it comes on the radio, but never really remember their name.)
Oops... you said *TWO* things.
As far as the $300 for the receiver, if the satelite providers really had a good understanding of what their target customers *could* be, then they'd do it differently. What they need to recognize is that they can now make nationwide radio stations. Which means that they can market to advertisers nationwide radio coverage. Radio can't say that right now. TV can, and look at how much advertisers are willing to pay for it.
If that's the case, subsidize the radios. Make them for whatever they cost, and sell them for $50. If you sell them cheap enough, everyone will get them. If everyone gets them, then they can market to their real customers: advertisers.
But that's just my $.02. I think the satellite providers are really screwing up their oppurtunity. If only I had a half billion (or so) so that I could start up MJH Sat Radio...
Key to financial independence: Spend less than you earn. Save and invest the difference. Do it for a long time.
I came close to getting SR but when I called I asked a simple question:
"What guarantee do you have in writing that, while the stations are currently commercial free, ensures that the stations STAY commercial free?"
This is the response
"We cannot guarantee at this time that we will remain commercial free."
After having a lawyer friend make some calls this was the response
"The commercial free aspect of our service is an introductory program only. We are currently pricing out commercial time and negotiating with prospective sponsors. We do not have any fixed implementation time yet."
Man, what ever happened to false advertising? Serves these shady bastards right for trying to fleece their customers. I feel really bad for all those who did subscribe.
In fact answer me this: Why, if I pay for cable TV, are their commercials? I remember early on that cable was virtually commercial free. I also clearly remember when Showtime, Cinemax, and the Movie Channel had zero commercials (HBO didn't have their own station yet. They were more of a production studio. I remember getting HBO's station when it came out, begging my Mom to get it, for one thing... Fraggle Rock, mmm Doozer sticks.... Ahhh...)
It's kind of like public education, when is enough money enough? Studios keep telling me that it costs too much to make a film. Well first lower salaries... oh wait that solves the problem.
The problem is that the contemporary marketing methods have no concrete, economic validity anymore. They have brushed aside capitalism in exchange for poorly disguised Socialism and we are paying the price. Capitalism is the idea the in economic terms it is survival of the fittest. True Monopolies, Government bailouts, restrictive cost of entry, and plain criminal racketeering have crippled Capitalism and forced people to embrace Socialism thinking it will solve the problem. This is the same mentality the satellite radio producers were thinking.
-=[ Who Is John Galt? ]=-
I work in IT at a Fortune 5 company (woohoo). The coffee cabana's here have been littered with guerilla marketing by people paid to seed interest in this technology for several months now. The spam they leave lying around trying to make it look like people are reading about it on their breaks are almost laughable. It is like those people who are paid to hang out in bars with a new mobile phone or wear designer clothes to "advertise" in stealth mode. The ads for XM are misleading and the local interest is fake. BTW, I don't care how they try to skirt around it: the service is NOT commercial free.
standard optionXM and the like have been heavy to push factory installs of these units in demographically selected automobile models. There are groups at the Big Three automakers that are designing marketing plans around these technologies. I imagine it will be along the lines of "first 6 months free!" then you get $10/month'ed to death like every other subscription service that you don't need. The lazy will keep paying it and think they're getting value.
transmission controlI think it is interesting how it is billed as satellite radio when in fact the majority of subscribers will be receiving signal not from the satellites but from the repeater towers they had to erect in the major cities to deal with the signal loss caused by tall buildings. San Francisco, Los Angles, New York, Boston, Chicago... they and more only run on the repeaters. Subscribers of satellite TV can tell you what happens to the signal on a stormy day or even a cloudy day. Ask this to your satellite radio provider: does it come with local channels?
epilogueI've discussed this technology with my family and friends and advised them to avoid it like the plague. I did the same thing when those DivX players came out. It is bad news people. Stay away. Stay far away. Invest your money in public radio.
Speak truth to power.
And then there's the issue of paying $10 a month (after shelling out $300 for a SM receiver) and you still have commercials on some of the stations. Like I'm going to pay $10 a month for music that has commercials. I don't think so! I can buy a CD a month for that price.
Then there's this thing about not being a teenager with my first car. I try not to spend my entire day in my car, thank you very much. Their model is problematic for the majority of people and they probably don't even realize it.
-- Knuckle Blood : Official Lube of Team Rusty Nuts.
--cyberfriend of mine told me she and her husband were so impressed with satellite radio when they got it for themselves that they installed it for their drivers on all the trucks in their small trucking company. She said-and I agree- keeping employees happy just makes more sense when it's a minimal cost like this. Long haul truckers cover a lot of turf and regular broadcast stations reception can change wildly sometimes depending on where you are driving, whereas the sat radios work most anywhere's and are very good quality audio. --nice to know there's decent bosses left.
The other problems are most people listen to the radio while on the road for traffic info. Many good radios have ARI (automatic road information) so if the station you are listening to doesn't have the latest road information, the ARI will kick in and give it to you. I have not seen any of the SAT radio supporting this. It may have it and I haven't noticed it bacause I am not shopping for it. The feature if it has it is not mentioned in any of the advertisements for the service. I did ask a dealer if one subscription could cover a second receiver the same way cable TV works. The answer was no, but you can get this neat easly transportable (by thieves) unit to take between the house and car. No thanks. I would want the car unit firmly bolted in. No I do not want two subscriptions.
If I was stuck with one subscription, I would put the reciever in the house and use it as a replacement for Napster. Then use the CD's (cutting out songs I don't like) in my in dash MP3 player with ARI. But due to the cost and the down economy, I have opted out. I can get music off a cable system without buying yet another box with a subscription.
The truth shall set you free!
We put an Alpine FM modulated XM system in my wife's car a couple of months ago to help relieve boredom during her 45 minute drive to and from work. She absolutely loves it, going as far as saying that between XM and the TiVo, TiVo would barely win in the "can only keep one convenience" debate.
It soon got to the point that I couldn't stand being in my car. I ended up getting the same system.
My initial thoughts were that it was ridiculous to pay $10 per month for radio, I can just listen to CDs, etc. Those are valid points and the cost of the hardware can certainly make it hard to justify, but I think it's worth it.
Listening to your own recorded music comes the closest to being a valid argument against satellite radio IMO. FM/AM doesn't even come close. The variety and lack of commercials make XM easily worth $10 per month. My favorites: Fred ("an audio history of alternative music"), Ethel (alternative hits), XMU (new music), Mix (70s, 80s, 90s, 00s) and the comedy channels.
We drove 6 hours to a recent vacation destination and I decided then that I never wanted to be without satellite radio. XM made it the quickest 6 hour drive I've ever had to endure.
What if the Hokey-Pokey really is what it's all about?