Sirius XM Gives 2 Weeks' Notice

Sirius XM Radio (NASDAQ: SIRI  ) is giving itself two weeks to win back departed subscribers and owners of dormant satellite radio receivers.

The media giant will turn on all of its sleeping receivers tomorrow, giving freeloaders two weeks to preview 60 commercial-free music channels, as well as sports, news, talk, and entertainment programming.

Sirius XM has followed premium cable movie channels with these previews before, but I can't recall the last time that the taste test lasted this long.

The satellite radio provider knows what it's doing. A dormant receiver is no different than an empty hotel room or a vacant seat on a plane. It doesn't cost Sirius XM anything to activate the devices, and even if a sliver of those taking the preview find themselves smitten by Sirius or XM and hop on as paying subscribers, it will be an incremental victory.

These are interesting times for Sirius XM, with the stock trading near its four-year high.

Liberty Media finally took majority control of Sirius XM this month, wasting no time in reshaping the company by shaking up the board last week.

Sirius XM's personalized radio is also now in beta. Media watcher SiriusBuzz kicked the tires over the weekend, and while Spencer Osborne applauds the efforts of customized curation, he's not exactly sold on it being a game changer for investors.

I don't necessarily agree. Pandora (NYSE: P  ) owns this space, and will continue to do so when it comes to free ad-supported music discovery. Pandora served up 1.39 billion hours of content last month, and that will continue to increase. However, on the premium end -- with the handful of Pandora subscribers who are actually paying for commercial-free access -- MySXM could be a material contributor here.

There are 23.9 million Sirius XM subscribers, and it only costs receiver-based subscribers $3.50 a month for streaming access. It's a rate that's comparable to Pandora One and far cheaper than Spotify. MySXM clearly improves the value proposition of streaming, and that could push average revenue per user higher in the coming months.

We'll see how this all plays out. For now, Sirius XM is ready to flip the switch tomorrow on millions if not tens of millions of dormant receivers.

Offering up a taste of satellite radio on a toothpick should prove to be pretty tempting bait.

Just hit play
Despite Sirius XM being one of the market's biggest winners since bottoming out three years ago, there is still some healthy upside to be had if things go right for it -- and plenty of room for it to fall if things don't. Read all about Sirius in our brand-new premium report. To get started, just click here now.


Read/Post Comments (2) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 29, 2013, at 2:46 PM, Gyre07 wrote:

    I hope I'm wrong, but I don't think "2 weeks free" isn't going to do much to boost sales.

    If somebody has the hardware, they're already subscribing. If they don't, they won't have their new XM radio before the two weeks is up.

  • Report this Comment On January 29, 2013, at 4:34 PM, DR1P wrote:

    Gyre07... There are a lot of cars out there that have Sirius XM radios in them in which the owners didn't renew the subscription for one reason or another or that are in cars people bought as a used car and never had a chance to try it. Those units are the targets of this promotion.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2222253, ~/Articles/ArticleHandler.aspx, 10/21/2014 2:38:26 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement