Over the past decade or so satellite radio has become nearly ubiquitous in new cars sold in North America. In fact it’s unusual for a new car not to come with three months of free satellite radio service.
At one time, the two satellite radio companies, Sirius and XM, were near bankruptcy. Costs of scaling the business were simply greater than anticipated at the outset, and the adoption rates weren’t high enough to produce profitability.
Eventually the two companies merged to become SiriusXM. Today the combined operation is profitable, although the long-term viability remains an open question.
I for one love having satellite radio in my car and regularly listen to a set of presets. I seldom tune outside of these presets. There is such an assortment of programming available on the SiriusXM service that I could spend my entire commute just devoting say 30 seconds to each channel and still only get through a fraction of the lineup.
To give you an idea of my tastes, here’s an overview of my presets, and I go through the entire complement at least twice during my drive to work.
Watercolors: delightful collection of light jazz.
The Bridge: a collection of light pop standards, mostly from the 70s.
CNBC: I particularly enjoy the Squawk on the Street segment; the hosts regularly manage to draw Tier 1 industry leaders to this segment.
CNN: a radio feed of the TV channel. I am a CNN fan, so I listen quite a bit to this channel. While the content is a direct port of the TV channel, the commercials are specific to the satellite service. Many are quite colourful and irreverent. Examples: Jimmy for Zyppah, Big Lou (“remember, he’s on meds too”), and numerous get-out-of-debt commercials with unintelligible caveats at the end.
Bloomberg Radio: an all-business feed. Locally, radio station 1410 AM has begun carrying a Bloomberg feed.
60s on 6: what else but the music from the 60s. Several times a week the channel features longtime broadcaster Cousin Brucie, now in his 80s.
Real Jazz: just as the name suggests, a channel devoted to the standards and the jazz greats.
BBC World Service: the venerable British broadcaster with what at one time might have been its shortwave radio feed.
70s on 7: well, you get the idea.
Classic Vinyl: what else but good old 60s and 70s rock and roll. Think Smoke on the Water.
Margaritaville: yes, basically wall-to-wall Jimmy Buffet.
Influence Franco: emerging French music from Canada.
When I polled my Grade 12 students on the matter, not one was familiar with satellite radio. That can’t bode well for the future of the service. Management at SiriusXM has no doubt noticed this. Let’s face it, Howard Stern put satellite radio on the map and eventually made it profitable but that same Howard Stern won’t pull in the next generation of subscribers.
Younger consumers are interested in streamers and on-demand music choice. That has led to speculation that SiriusXM might consider acquiring leading American streamer Pandora.
Teacher Catrina Luongo writes that she used the satellite service only when it came free with her new car. “My husband and I loved it while we had it,” she adds, “and he especially loved it for the sports channels. He downloads free podcasts now.”
Colleague Deanna Schaper-kotter states: “Love my satellite radio!I Had a free trial when I got my new car and renewed it for super cheap. I think I got an extra 6 months for $40.”
Another enthusiastic subscriber is Biagio Pepe: “I like it. There are stations that play music that I will never hear on regular radio here in Vancouver. It came as a promotional offer when I purchased a new vehicle. Then I used a coupon that gave me 6 months for $25. I have the basic plan (1st level) that I now pay for. I don't listen to many stations, but I like going to the sports stations.”
A long-time user of the satellite service is colleague Angela Filipovic. “I use SiriusXM primarily in my car but sometimes at home through my phone and Bluetooth speaker. I like the variety of programs available and the ability to quickly switch to something else if I’m not keen on what’s playing. I love having commercial-free radio.”
Ms. Filipovic notes one of the frequent complaints about the service: upselling. The company runs annual, or semi-annual subscriptions, trying to convert users to more expensive plans when these expire. She is careful not to allow auto-renew, as this typically results in higher fees.
She presses the company each time to get a better deal than what is initially offered. As an Amazon Prime member she lets it be known that she has access to the free Amazon Music app.
In my own case I politely state that while I enjoy the service it is not without issues. On my particular commute there are several locations where the feed cuts out, either because of buildings or trees. I stress this to the customer service representative and make it clear that I will not pay full price for an incomplete service. So far I’ve had two years of heavily discounted subscription.
At present there are three SiriusXM monthly plans available in Canada; a $10 plan with 65 music channels, a $16 one with 85 channels and 50 sports channels, and a $22 plan offering 140 channels in all. The latter plan also includes streaming access, which is otherwise a $4 add-on. However, it doesn’t stop there. SiriusXM tacks on a 14.2 per cent “Music Royalty and Regulatory Fee”, supposedly allocated to up-and-coming Canadian artists.
Satellite radio is a peculiarly North American business. There is some incredible engineering and physics at play in delivering the service to very small antennae on moving vehicles.
Radio, TV, the cinema business, the newspaper industry, all have undergone massive disruption from the evolution of Internet technologies. Let’s check back in a decade and see if satellite radio has survived.