Satellite Radio in Fiscal Trouble 326
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?"
"Worse".. (Score:1, Insightful)
I hope.
too damn expensive (Score:3, Insightful)
Less "discretionary" cash to spend? (Score:5, Insightful)
I know that if I were concerned about my retirement fund, I'd be cutting back where I could to put more money there.
When this thing came out, many people didn't say "can't" or "shouldn't" when it came to luxury purchases. Now, though, people are keeping their wallets in their pockets a bit more.
Wait.... (Score:5, Insightful)
I can think of a lot of reasons why it wouldn't be doing so well though... how much does it cost to put a satellite into orbit or "rent" one of the ones already up there? And how much are they charging customers per month for the service?
200,000 customers? In a major metropolitan area, like New York City, one radio station can have that many listeners. It sounds like a lot, but it isn't.
Kierthos
Re:too damn expensive (Score:3, Insightful)
Kierthos
Comment removed (Score:5, Insightful)
Re:too damn expensive (Score:5, Insightful)
But, if we stop listening to FM radio because everything on there is commercial-laden crap, then the terrorists have already won! er, then we're not as exposed to new and upcoming music (XM has a *lot* of indie stuff, as well as stuff that'll never get signed) - I've never heard so much Wilco in one place.
Re:Wait.... (Score:3, Insightful)
It was a dumb idea. (Score:5, Insightful)
2. And when I am in my car, I listen to traffic, weather, or my own music collection or local radio.
3. The exception is long distance trips. Perhaps one multi-hour drive a month.
4. At home, I have a big music collection. Stuff I actually bought over the years. (Don't blame MP3s in my case). I also have digital TV, with it's music channels. Plus a collection of reasonable local radio stations (and many more unreasonable ones)
So! Someone has to remind me why I should spend $$$ for this service. I can see why some people would spring for it. Just not me.
Damn, it's snowing... there goes summer...
Not the end... (Score:3, Insightful)
Even a massive project like Iridium eventually found a buyer. Even if both of these companies go bankrupt it would be an attractive purchase for some investor.
Re:Wait.... (Score:5, Insightful)
Re:Less "discretionary" cash to spend? (Score:3, Insightful)
Yeah, whatever. (Score:5, Insightful)
Most people spend 99%+ of their time driving within 50 miles of home, where one radio station will cover them. Anyone who's all that picky about what they listen to will probably want to listen to CDs anyway. Personally I'm probably going to get a car MP3 player (I was waiting for an OGG player but I'm tired of waiting).
I spend $120 a year but I send it to public radio.
bad business (Score:3, Insightful)
Sat radio is a great idea, and an idea that I have held off embrasing due to too many uncertianties. Why they chose to go with propritary hardware for their services is beyond me. $200-400 for the setup, and if the service goes out of business, you can't just call up the compitition to reprogram the radio.
This can, and should be able to work in the long run; It's just that good of an idea.
Re:too damn expensive (Score:5, Insightful)
Free? Maybe public broadcasting or community radio, but commercial radio? Nothing like hearing your music interupted by ads for zit creme, Bud, soda, etc. Maybe you've gotten accustomed to it, but man, lemme tell ya, it ain't free!
Now imagine what a piss-poor business model selling people TV over a wire and STILL including commercials and THEN charging for premium channels.
What I See Happening... (Score:2, Insightful)
Satellite Radio and XM will basically become options on luxury cars so that those companies can get paid up-front for service. The manufacteurer will then pass off the cost to the consumer, and most likely the monthly fee will disappear. Or, they maybe just make it standard in luxury vehicles. The possabilities for markets for their products are there. I just don't see them using those markets.
Re:Wait.... (Score:2, Insightful)
Something goes wrong with Z-100's main antenna, they can at least get a technician or twelve physically to the location and start figuring out what went wrong. Something goes wrong with a satellite, and you have to schedule with NASA to get that fixed.
On the plus side, they aren't bound to a specific geographic location. Outside of stations changing their formats and a lot of people finding new radio stations because of that, I daresay a lot (most?) radio stations have fairly stable listener bases. If XM Satellite can stay a going concern long enough, they can continue, even with a slow-growing customer base. But I'd say they need some more customers, fast so they can even have the option of slow growth.
Kierthos
Re:I've heard ads for this on the radio (Score:3, Insightful)
I think you guys forget the number of people who drive most of everyday. Think Semi Drivers. Think Delivery Trucks. Think Tow Trucks. A lot of those guys own their own trucks, and travel across 'radio borders'. We all know how limited radio is, and how statios in different cities are all copycats.
Satellite Radio gives you more choice, and you don't have to worry about 'blackout' areas between major cities. I actually listened to AM one morning driving I-65 bewteen Indianapolis and Chicago when I was 18. How many 18 year olds (who don't get their asses kicked) listen to AM radio?
Some places are just that barren.
Where's the value? (Score:3, Insightful)
Let's see, no subscription - no wait, I have to pay a per-month fee. Traditional radio is free.
I don't have to listen to ads? No, wait, I am paying for my airtime to listen to people trying to sell me stuff. Same as t-radio.
Quality of music? I must be able to listen to indie artists and hard-to-find cutting edge stuff, right? Gee, that doesn't seem to be the case either.
Static free? Hmm, most of the time my FM is static free, too.
So I'm just not seeing the value of paying $300+ for a receiver and $120/yr for the service. The cost-to-benefit ratio is just to high.
If they got rid of *all* the ads, I would probably do it in a heartbeat. But I'm not paying to have someone push product on me. (Note that I don't have cable TV either...)
Matt
I hate "per-month" charges (Score:5, Insightful)
I don't mind in the least paying $300 or $400 for a nifty gadget.
I have VERY HIGH SALES RESISTANCE to anything that carries a "monthly" fee for anything. My nifty gadgets OFTEN last for, say, 100 months (a bit over 8 years) and I am quite capable of multiplying a monthly fee by 100.
When I buy a $20,000 car, I'm quite agreeable to considering a $300 or $500 add-on.
But a MONTHLY fee? Forget about it.
Give-away-the-razor-and-make-money-on-the-blade
Perhaps I'm not the only consumer who can multiply by 100 in my head.
Re:too damn expensive (Score:3, Insightful)
It's a good business model when you have things your "competitor" doesn't... like ad-free stations, digital quality, hundreds of stations to choose from, many things you can't normally get in most areas, and the ability to drive for long distances without losing the same station. If I drove more than I do, I'd get XM in an instant.
Why pay for advertisement? (Score:2, Insightful)
Re:too damn expensive (Score:2, Insightful)
Your time is worth nothing? Mine ain't. If I could be listening to music or news instead of blather about some product or service, buddy, I hit the channel changer. Life's too short to spend listening to commercials, particularly the ones that are annoying.
Not only that, you've freely given brain cells to remember those commercials and be programmed by their messages (Pepsi makes you think young, Doctor Scholl's cures athlete's foot, Gritty Kitty stays crunchy even in milk, etc.)
Re:Costs vs Benefits (Score:3, Insightful)
Having said that, I'm holding off on sat radio until the receivers aren't proprietary.
More centralized control, less freedom (Score:3, Insightful)
For technical reasons, there are only two satellite radio networks, Sirius and XM. Both have capacity for a lot of channels. The FCC decided to use a "market" approach and allow each company to choose details of its own technology, so their radios are incompatible. Imagine how well TV or FM radio might have done if different stations required different receivers! Consumers are locked in. Sure, it's nice work if you can get it, but consumers aren't quite as dumb as the companies wanted them to be.
Even worse, the duopolists were not charged as common carriers, but as programmers. So XM and Sirius determine what they will carry, and if they don't want something run, it won't run. Sure, they've figured out that they have to offer some kind of musical variety, so they have country & western streams, '70s rock streams, '80s rock streams, sports streams, etc. But the plain fact remains that they control the horizontal, they control the vertical, and a Sirius or XM subscriber won't be exposed to anything that the suits at Sirius or XM don't want them to hear. I guess to them, a stream playing Wilco and an NPR stream are radical enough.
So if this turkey fails, maybe somebody else will try again. If an operator were less greedy, and leased enough channels to independent programmers, then a workable business might be found.
Cable TV model would be better (Score:1, Insightful)
--*Rob
Re:Yeah, whatever. (Score:5, Insightful)
Ummmm, I agree that this whole coast-to-coast coverage thing is completely overrated, but I have a different tack on it. To wit:
Most people spend 99%+ of their time driving within 50 miles of home, where one radio station will cover them. Anyone who's all that picky about what they listen to will probably want to listen to CDs anyway. Personally I'm probably going to get a car MP3 player (I was waiting for an OGG player but I'm tired of waiting).
Yeah - and one of the cool things about going on vacation every year is that I get to listen to all the radio stations from other towns along the way -- It's *great* to hear something different once in a while. I also like to go out to McDonald's for dinner while I'm at the beach - can't get a flavor like that at home!
Seriously, though, it really used to be kinda fun hearing radio from other parts of the universe when driving at night on vacation -- especially sportstalk and talk radio. But that was before the dark times.... before the ClearChannel...
By virtue of the ClearChannel fiat, doesn't broadcast radio enjoy coast-to-coast coverage now?
Re:too damn expensive (Score:2, Insightful)
IMO Sirius got their legs blown off by their late launch. I wouldn't be surprised to see them in bankruptcy inside of 6 months. XM already has the early adopters and continues to gain market share.
My prediction is that when Sirius goes bust that one of the major media players (Clear Channel, AOHell-Time-Warner, etc) will swoop in and buy for pennies on the $. Of course shit-canning the existing stock swapping shenanigan and busting the original investors.
Haven't I read this story before???
Oh yeah... I have XM and love it. Very robust choice of audio entertainment without the hassle of manuevering CDs or MP3s.
Re:The best damned service I've seen in a long tim (Score:4, Insightful)
Don't worry about satellite radio as the providers have some large pockets to draw upon - the auto makers. Next year, GM will offer the service as standard equipment on some of the vehicles - with a free year of service. If only a small percentage renew, then the satellite providers will be listening to satellite disco. If a significant percentage renew, then you are looking at a threat to FM.
On that note, with all these satellite head units running around in the new autos, it would make financial sense to provide some publically funded stations free-of-charge. That would be the largest opportunity.
$0.02
The reason I haven't bought one... (Score:4, Insightful)
First of all, you can only get a receiver for your car! Is this really the only place they expect people to listen to the radio? Sony makes a unit for the XM systems that is car removable, but I have been told that is just the headset and the "base unit" which mounts somewhere like under a car seat is separate.
Secondly, they need to come up with something better than "just tear out your factory deck". I LIKE my factory deck, and for those who don't know this already, you get better resale on a car that has the factory deck in it. Tearing out a custom unit when it comes time to sell a car is a pain.
Third, and probably most importantly for the prudent consumer, "Will I make the right choice?" The topic of this thread alone should be enough to convince most that this isn't a device you want to run out and spend $300 on. I want a little bit of a guarantee that my nifty new receiver isn't going to become a useless box less than a year after I buy it because the network is no longer in business.
Which brings me to point four: "Why can't I have a receiver that works on both Sirius and XM?" Yes, I realize they are competing for the same market segment. I DON'T CARE. I am a consumer. I want some guarantee that if Sirius(the network I'd probably choose due to a choice of programming) ends up in bankruptcy court, I want to know I have the option of getting service with XM. These devices are just too much money to be throwing away. And I want one that works in my car as well as my home.
Sirius seems to offer a bit higher quality programming than XM. XM seems like a whole lot of the shit that is on television, only now I can listen to it. I can pretty well guarantee that most consumers who are willing to shell out $10 or more a month for this type of service, which is basically radio(something we're accustomed to getting for free), aren't going to willingly listen to a bunch of damn commercials. This is in fact the reason I would choose Sirius over XM. Because they have NPR. No commercials. I get to listen to the news in peace. Commercials are just plain annoying.
Re:Good Riddance, I Say (Score:5, Insightful)
$120 a year isn't much to most upwardly mobile middle class Americans, and I believe public radio is worth at least that.
I listen almost exclusively to North Dakota Public Radio. Even here in ND the radio market is saturated with Clear Channel crap. I've found NDPR, to be informative, entertaining, and to have regional content that the now Clear Channel stations no longer carry.
Snowballed... (Score:3, Insightful)
Satellite = lost cause... (Score:4, Insightful)
Given the choise of spending at least $160 for satellite radio, or to just dump a few hundred tracks onto a couple of CD-Rs, I think I know which option most people will go with
Re:too damn expensive (Score:3, Insightful)
Re:Yeah, whatever. (Score:4, Insightful)
Lots of truck drivers have XM... lots of them... In fact the car audio shop in my store has done at least a dozen installs to big rigs over the last year... Yes to some that may not seem like much, but we aren't on any big truck routes so they are mostly going out of their way to get XM radio... Not to mention I've heard more than one truck driver mention that XM is the hottest thign going in the trucking community...
This also benefits people like my parents. My parents have never ever flown on a plane, if they go on vacation it's by car... & it's really hard to find good stations on a trip through multiple states. Especially when going by interstates to your destination because you may only be in range of a station for maybe an hour, probably less. And the incredible load of garbage stations is huge as well.
XM (& Sirrius) provide a way around those problems and the sound quality is better than most radio stations provide as well...
Now onto the 99%+ comment... sure most people may nevego more than 50 miles away from their home towns even, but who says they have good music stations...? My local options are all owned by one company (who in turn are owned by clear channel) & the rock stations are as follows: clasic rock (60-70's), 'modern' rock (80-90's, & top 20 rock tunes only & their are 4 of these stations take your pick), Top 20 station (which plays rap, R&B, & occasionally rock), & one 'soft' rock station that was supposed to be hard rock, but they decided their audience didn't want that... So in case you missed it my radio options suck... I grabbed XM radio the first chance I got, though it's already cheaper now to get it then it was when I bought it over 6 months ago...
I used to do CD's & in fact I created over 50 of them for use in my car... But it got so frickin' repetitive I couldn't take it anymore. Not to mention I can actually hear things I've never heard before on XM (Club music, Electronica, heck christian rock even...) all in high quality sound that is at least the equal of CD's... I thought about getting a car MP3 player, but they are more expensive up front & again I only hear what I have already heard a thousand times... Maybe you can stand that, but I couldn't...
Re:too damn expensive (Score:3, Insightful)
I understand the concept of a "nationwide radio station." That, in and of itself, would be nice. However, I *STILL* wouldn't pay even $50 with your subsidized receiver to listen to 10 minutes of commercials in a 30 minute bloc of music, if the advertisers catch on like they do in prime-time TV.
200 bucks can get me a internal CD burner (good for other things), a 50 pack of blank CD's, and a internal MP3 car deck. I ow have a few days worth of uninterruptible music, and 49 more CD's to add stuff to, with no additional costs incurred monthly.
Too inflexable and impersonal? (Score:3, Insightful)
Yea, commercial-free radio is neat... But some commercials are actually entertaining, Bennigans for example comes to mind. Yesterday, I heard a commercial for Time Warner Roadrunner service and the spokesperson was mouthing modem tones ("I no longer have to hear those bleeep beep blah pbpbpbpbpbpb dialup sounds") - it was hilarious. Do I like all commercials? No, certainly not - but missing the good ones would really suck.
I don't know about XM or Sirus, but the local stations all have DJs that put people from the area on the air to give shout outs, talk about things happening in the area and take requests. I don't care if the actual station is run out of a closet in Bumfsck, Alaska, as long as they're still Central Florida-centric, it seems more "personalized". Stations seem to realize that part of getting people to listen is listener participation. Hell, I've even called in a few times to vote for songs and make requests.
The other major problem with satellite radio is you can only listen to it where the equipment is. Yesterday, I was working on my moped (yes, I have a car too, the moped is NOT the reason for not liking satellite radio) in the garage - there's a boombox in the garage with a FM tuner, a tape player (what the hell are those things again?) and a CD player. I wanted to listen to music and didn't feel like getting up every 74 minutes or so to change CDs - so I put on the radio. If I had a satellite radio service in my car, I'd feel like I'm wasting my money since the majority of the time I listen to music (while working in the garage, mowing the lawn or in front of the computer) I wouldn't be able to use it. If I want to hear high quality commercial free music with just the songs I want - well, I can just bring my hard drive based MP3 player with me...
Great business model... just like Motorola! (Score:2, Insightful)
Let's see... business model:
1. Find the tiniest market we can
(people who travel out of their area
constantly, AND who make a sizable income)
2. Put a huge investment into our infrastructure
3. Charge way too much for the average person
to be interested, but nowhere near enough to
make a profit with the miniscule market that we
targetted.
I guess another target market of theirs is hicks
who live in the sticks (like my Dad), but they
don't realize that they live a different culture,
and would RATHER listen to their LOCAL radio
station, even if there's only ONE!
Wasn't Motorola's Iridium project a good enough
example? What is wrong with these companies?
What kind of morons are approving these business
plans?!?
Re:The best damned service I've seen in a long tim (Score:3, Insightful)
Currently XM and Sirius are almost exclusively available as high-end aftermarket add-ons. Obviously this isn't conducive to helping the satellite radio companies reach their break-even points (if memory serves me correctly from other articles I've read, the break even point is either 500,000 or 1,000,000 customers).
Sirius is partnered with Ford (Ford, Lincoln, Mercury, Land Rover, Jaguar, Aston Martin, Mazda, Volvo), Audi, BMW, DaimlerChrylser (Mercedes, Chrysler, Dodge, Plymouth, Jeep), and Nissan (Infiniti and Nissan). XM also has an impressive partnership list, including GM and more.
Once these OEMs start selling cars with satellite equipped radios from the showroom, sales are going to skyrocket.
You're wrong about inkjets (Score:3, Insightful)
Amen! (Score:2, Insightful)
How many of you have DSS or digital cable? How many of you have cutting-edge digital cell phones? How many of you have broadband Internet? Most of these technologies were seen as failures early on. Hell, I did a thesis in college a long time ago about something new called the "World Wide Web" that many people at the time thought would fail miserably because there wouldn't be enough interest in it and it took up too much bandwidth.
The reason these companies are failing is because they aren't getting enough subscribers. The reason for this is there are too many people out there who aren't willing to give new technology a try anymore. It's a shame really that the geeks/nerds/whatever in this country, who companies can usually count on to support things like this, are getting to be too jaded. Like everything else- I blame Microsoft. Tivo was supposed to be out of business over a year ago if you listen to the media, of course- it has the advantage of being based on Linux. I wish I could say one of the satellite radio systems used Linux, then I know it would get more support.
You can go to Best Buy and get a Sirius system for around $250 installed now, and I believe you can get similar deals on XM. If you don't like it- you can return it within 30 days for your money back. You can get FM modulator systems that use your existing car radio "head unit", and can use a temporary mounting for the antenna to make it easy if you really don't think you will like it.
I love my Sirius system and think it was well worth the money I spent on it. I don't support XM at all because they are partially owned by the same Clear Channel borg that run most of the local radio stations where I live.