Is Sirius XM the Next Netflix?

Sirius XM should follow Netflix into offering a Web-based product overseas.

Jan 28, 2014 at 4:00PM

Sirius XM (NASDAQ:SIRI) and Netflix (NASDAQ:NFLX) have a few things in common. They are both profitable broadcasters of third-party entertainment. They each lead their respective niches, with tens of millions of paying subscribers apiece.

However, they may also be alike in another way if Sirius XM expands its platform overseas in a few years.

Sirius XM's satellite radio business and Netflix's original disc-based rental service have their geographical limitations. Sirius XM's satellite fleet only goes as far as North America, just as Netflix would've had to build out a network of distribution centers across the world if it wanted to duplicate its model overseas. The Internet made Netflix's overseas push possible, allowing it to merely strike the content licensing deals and stream away. Could Sirius XM be about to do the same thing?

Sirius XM is no stranger to cyberspace. It's been streaming its channels online since shortly after the introduction of satellite radio. Sirius XM has been beefing up its Web-based offerings in recent years, improving on the receiver-beamed channels by offering a broader array of digital channels and introducing on-demand and music-discovery options.

This has naturally opened the door to a potential rollout of its platform in overseas markets that are outside of its satellite range, but there's been little to give investors a reason to believe that an international launch is coming anytime soon.

Well, that may change on Friday. Howard Stern's birthday bash -- the star-studded affair that will honor satellite radio's biggest star -- will be made available for free to non-subscribers as a stream through 

Yes, it will be available to all non-subscribers, including anyone outside of North America. Netflix will "invite the world," according to last week's press release, making this an interesting way to try to introduce its brand to geographical markets where it has not been previously accessible.

Obviously, this doesn't mean that Sirius XM is about to introduce its platform or a culturally tweaked variation internationally. However, it would seem strange if Sirius XM and Stern are emphasizing the global availability of this prolific event only to shut the world off after it's done. 

It won't be easy to compete in a competitive market for streaming overseas with a premium platform. Sirius XM's own Web-based platform is not nearly as popular as its satellite-based service. However, Netflix also faced some long odds when it expanded from Canada to Latin America to parts of Europe. It was the right call for Netflix, and it will be the right call for Sirius XM.

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Longtime Fool contributor Rick Munarriz owns shares of Netflix. The Motley Fool recommends and owns shares of Netflix. It also owns shares of Sirius XM Radio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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