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Satellite Radio is Dead

Posted: Mon Nov 24, 2008 3:58 pm
by Deep Thought
The perp? The Internet with a dollar in the car.

So sayeth Mike Elgan at ... hp/3786146" onclick=";return false;

I have to agree with all of his broadband makes Sirius/XM irrelevant, especially in the car where almost all sat radio listening takes place.

I still say Mel combined the two companies so he could buy the satellite links out of bankruptcy for data services.

Re: Satellite Radio is Dead

Posted: Mon Nov 24, 2008 6:27 pm
by BroadcastDoc
I actually don't agree with him.

While streaming is making inroads in cars, I can tell you that it is next to impossible to listen to streaming radio in Milwaukee or Madison on AT&T's 3G network during drive time. It's buffer city! While I think that the technology will get there, it's simply not there yet. Imagine the Ryan at drive time, with all those cars streaming. Where does the bandwidth come from, and who pays for it? Simply put, broadcasting works because of the one-to-many design. Bring that down to one-to-one, and it's a significant puzzle to solve.

I believe that Mel is looking at filing for bankruptcy and picking up the pieces, but not for data services. 10m subs at $12.95 a month, without the burden of the debt from launching the birds is pretty attractive.

I think the model is fundamentally sound, it was the execution that was the problem.

Re: Satellite Radio is Dead

Posted: Mon Nov 24, 2008 6:44 pm
by K9EZ
The problem is you re using AT&T. Sprint and Verizon seem to do much better.

Re: Satellite Radio is Dead

Posted: Mon Nov 24, 2008 7:06 pm
by Deep Thought
AT&T's alleged 3G network is crap in the Midwest. Here in the burbs I spend more time in EDGE than I do '3G' due to their laughable deployment. But out west it's excellent. I can drive around Vegas and my LG phone keeps a 64 kbps stream going, and having that linked via the Ford/Microsoft "Sync" system to the car stereo is an eye-opening experience. Once they get their snot together in-car Internet access is going to be a "game changer" (to coin a phrase). I can listen to Radio Paradise in the car with better sound quality than anything satrad has to offer.

Your Dan Ryan example is missing a piece: Internet-connected radio listening (and iPods) replace Satellite, not terrestrial. Broadcast has already lost those listeners. Only a small percentage of the cars stuck in that traffic jam will need the bandwidth. That's the problem...satrad never managed to hit critical mass and its potential for increased penetration is almost dried up.

Mel may make it to the BK filing but those creditors won't just walk away, however a significant number of those 10 million subs will. Their churn rate is alarming, and a nontrivial number of them are for radios in rental cars and trials subs in new cars. Both of those sources are in deep trouble.

And I say this as a 2 year paying Sirius subscriber. Glad I didn't pay anything for the radio.

Re: Satellite Radio is Dead

Posted: Mon Nov 24, 2008 7:38 pm
by BroadcastDoc
Yes, but again, you both are speaking as early adopters. That same 64K you're using now isn't yet widely shared with wireless cards, cell phones and other devices, but it's starting to grow exponentially (just ask AT&T with their iPhones!). There is a limit to how much bandwidth can be pushed out there on a cell. For the sake of argument, let's say there are several hundred sat listeners on the Ryan. Imagine if all of them were streaming radio? It's a tough sell, especially since the wireless guys don't want to be a "dumb pipe". You can be sure that if it starts to affect performance, you'll see those cell-co's enforcing the "no streaming media" clauses in their TOS's.

I don't see Sirius/XM becoming a data provider. It'd be a rough time trying to get those licenses changed especially for the company that caused the failure in the first place. I have a feeling that the FCC under the Obama administration will be a much different animal. Plus, there's just not a whole lot of pipe available on those birds!

Re: Satellite Radio is Dead

Posted: Mon Nov 24, 2008 10:51 pm
by Deep Thought
AT&T's wireless network today is not a valid benchmark for what is going to happen in the next two years, and the iPhone is a clever toy but is already obsolete. Tethering is the future and the cell phone or its successor will be the front-end modem for a whole host of built-ins and portables. Kitchen sinks like the iPhone do a lot of things but do none of them very well. Separating the transport also frees the user from committing to bad wireless service (see: AT&T) or locked-down equipment (see: Apple). If the wireless folks want to avoid being a dumb pipe they need to make sure they provide content that works with these devices. Otherwise the rotting corpse of Sprint will rise from the grave and find relevance in this new market. WiMax isn't the answer but something like it is.

SDARS claimed a less than 4% share of radio listening as justification for the merger. Those subscribers spent about 40% more time listening to broadcast radio than they did XM and Sirius combined, however, which means SDARS supplements rather than replaces broadcast listening (sat listeners are much heavier radio consumers with over 50% more TSL as a group). In spring 2007 Arbitron gave XM+Sirius a cume rating of 6.7%. None of the SDARS channels...not even Howard Stern...cracked 1% (Sirius 100 and 101 together cumed 0.7% with an AQH of 0.05%). Assuming a 12+ radio market of 141 million, that's less than 9.5 million listeners total, far short of the 19 million subscriber count claimed by SDARS. Something is wrong here, and either the subscriber count is inflated, a lot of those counted listeners have a lot of subscriptions or a lot of those radios are silent. In any event the relatively small number of satellite-only listeners could be handled by a properly designed cellular radio system. Instead of paying $15.95 per month for proprietary content what if Sprint or some other desperately enlightened carrier kited a $20/mo low-speed (128 kbits/second) mobile wireless Interenet plan which allowed you to tether your favorite Internet radio? How about your car stereo? At that point, SDARS is completely irrelevant. Keep in mind that Internet streaming already has four times the audience of SDARS and once that is unleashed into the vehicle market it's game over. You could stream your thousands of MP3 tracks to your car among other things. My two year old LG CU-500V has no problem doing this via Bluetooth.

As for the sat licensing...the merged company managed to get past the "no exceptions" competitive licensing requirement quite easily and I think Mel is still trying to get his hands on the spectrum the nonexistent third satrad operator was supposed to use. The FCC is a pushover these days no matter who is in the White House. All it takes is a couple of phone calls from Capitol Hill.

Re: Satellite Radio is Dead

Posted: Tue Nov 25, 2008 6:52 am
by K9EZ
Sprint already does have a low price data plan (and high speed to boot). I have all 5 of my phones on a plan that includes:

Unlimited Data
Unlimited Text
Unlimited Long Distance
Unlimited Sprint to Sprint
Roaming free

And the plan is $145 (again for FIVE phones). That means that my Treos can now be EVDO "modems" using a program from 8) :D So basically I am getting unlimited data for free in the plan. And most of the Sprint coverage that I am in is EVDO.

I quite often stream from my cell phone, even in VERY rural areas. (You should see what the back range of Ft Bragg looks like. No one around for MILES.) Heh heh Doc has been my streaming provider a good amount of the time.

Re: Satellite Radio is Dead

Posted: Tue Nov 25, 2008 8:41 am
by leaderofthefreeworld
Meh, article is saying the same thing about satellite as they said about Terrestrial radio when Stern moved to Sirius and subscriptions went up.

There is no talent in Podcasts (and "live Podcasts" are called streams). I am not saying that there are not good podcasts, but original content, with live callers and interaction, responding to the game as it happens or the debate, as it happens, not covered by the MP3 player or most cellphones. Well the music will come from the Ipods, this might take away from the AM/FM listener, but not Satellite, I listen to Satellite because the music is not on my iPhone because I have forgotten about it or did not know about it. I have a lot of Sinatra, but not all of the stuff I can hear on a station dedicated to his music. I like 90's music, and I have a lot of it, but there is no way I would ever remember a throw away song by DaDa or the Nerfherders. If I want to hear the same ole same ole, I listen to FM or the Ipod.

WiMax in the car! Show me a "tuner" that I can easily switch between stations (not presets) when going 70MPH down a rural road on my way to Craters of the Moon National Park. #1 there is no WiMax out there, and 2 there is no "tuner" that I do not have to preprogram. WiMax as we know it now is still not completely reliable. I did a remote last week using a Tieline Patriot via Sprint 3G data connection. 3 hours no problem, then bam, nothing, no connection. Had to go to landline to finish the broadcast, and this was in heavily populated (by people and cell towers) North Raleigh. Data rates blah blah blah, if it does not work 100% for hours on end it is not ready for prime time.

Cost is not a big issue. $13 a month is not much for the people that want the service. They realize this, and cater to the people that want it. To those that don't, they offer $7 retention plans, if not they lose them because they know those people do not want the service. Same happened to me when I got cable on a 12month promotion. They saw I was on a retention plan when I called to cancel and did not try to keep me, they knew they got me at the price point I wanted and let me go when they no longer wanted to offer me the price point.

Re: Satellite Radio is Dead

Posted: Wed Nov 26, 2008 1:18 am
by Deep Thought
leaderofthefreeworld wrote:Meh, article is saying the same thing about satellite as they said about Terrestrial radio when Stern moved to Sirius and subscriptions went up.
You made a lot of good points, but two things are a lot different now. One, Sirius/XM is drowning in debt it can't pay, and its market is shrinking. Two, Internet radio is a lot more than stale podcasts. There are live stations and some are outstanding.

Complicating the situation is a fourteen cent stock price. They have a market cap of $474.56 million and a debt three times that. They've lost 96% of their value in a year. Vonage is in better shape...

Re: Satellite Radio is Dead

Posted: Wed Nov 26, 2008 10:59 am
by rockmanac
I had been a subscriber of XM and canceled it earlier this year because I just couldn't justify spending the money for it. The programming wasn't anything different than I can get online and in reality, I get a wider variety using Pandora than I did on any XM channel.


Re: Satellite Radio is Dead

Posted: Tue Apr 30, 2013 10:09 am
by Funk Republic Radio
SAT is irrelevant.