No Howard Stern? You Can't Be Sirius!

Today's the day that Sirius XM Radio (Nasdaq: SIRI  ) bulls have been longing for. Its Web-streaming program has hit the Apple (Nasdaq: AAPL  ) App Store. Now, music fans who never bothered to spring for a portable receiver can take their favorite commercial-free stations on the go. Hungry Howard Stern fans who have been denied the radio celebrity's raucous show can now --

What's that? The Howard 100 and Howard 101 channels are not available on the new application?

"Some select programming, including MLB Play-by-Play, NFL Play-by-Play, SIRIUS NASCAR Radio, and Howard Stern, will not be available on the iPhone and iPod touch," reads this morning's press release. "Listeners will continue to be able to access that programming through the platforms they are currently offered on."

The lack of live sporting events isn't a surprise. Those broadcasts have never been a part of the online streaming that both Sirius and XM have made available to their subscribers -- at no additional cost -- for years. However, Stern is a part of the buffered Internet streams for active Sirius subscribers. How can a premium product not offer satellite radio's biggest draw?

Sirius without Stern is like the Los Angeles Lakers without Kobe Bryant. It's still entertaining and somewhat competitive, but not something that millions of fans will pay a premium to experience.

Even with Stern, the app was going to have an uphill battle. Making active subscribers pay $2.99 a month -- or $12.95 a month for premium Internet-based accounts -- is a gamble. Most of the App Store's favorite music downloads are free radio and music-discovery sites, such as Pandora, imeem, Slacker, CBS's (NYSE: CBS  ) Last.fm, Time Warner's (NYSE: TWX  ) AOL Music, and Yahoo!'s (Nasdaq: YHOO  ) Y! Music. There is certainly a market out there for folks willing to pay up for Sirius XM's differentiated content, but can the application succeed, given its limitations?

Some potential App Store subscribers may balk on principle. Why pay as much as those whom Sirius XM paid the most to acquire? Sirius XM needs to lower the price of its App Store program -- and quickly, before folks begin whipping out their calculators.

Roughly half of Sirius XM's 18.6 million subscribers have Sirius receivers. If we break down the $500 million that Sirius XM is paying over Stern's five-year contract, that comes out to approximately $10.75 a year per Sirius account. In other words, a Stern-free product should be charging about a buck less every month, at least. The deal with the NFL isn't as costly, but of course App Store subscribers still don't receive it. On the XM end, it's a $650 million deal for 11 years of Major League Baseball. 

Sirius XM already offers discounted "family friendly" and "mostly music" plans to conventional subscribers. It's only fair for the company to mark down a limited online offering, and it had better do so before consumers decide to ignore the application, the way they have for the tens of thousands of other App Store programs collecting dust.

I have had a lifetime subscription to Sirius since 2004, and with that I have access to Stern's online streams. Am I really going to pay to hear less content through my iPhone? Sorry, Sirius XM. You have either seriously missed the mark or overestimated your audience.

More news than static on Sirius XM:

Apple is a Motley Fool Stock Advisor pick. Try any of our Foolish newsletter services free for 30 days.

Longtime Fool contributor Rick Munarriz subscribes to both XM and Sirius. He owns no shares in any of the companies in this story and is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.


Read/Post Comments (31) | Recommend This Article (21)

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 June 18, 2009, at 1:12 PM, bigpeach wrote:

    I have nothing to add, I'm just curious why this company receives so much attention on MF. It is easily the most covered company on this site despite being a horrific investment over the years, and at present, highly speculative at best. I would prefer coverage of more investable companies. A search turned up over 20 articles published year to date by MF staff, most by Mr. Munarriz who seems to write an article at least once a week. Where does the obsession with this company come from?

  • Report this Comment On June 18, 2009, at 1:16 PM, nohoward wrote:

    no stern no app

  • Report this Comment On June 18, 2009, at 1:27 PM, TMFBreakerRick wrote:

    BigPeach, Sirius XM is one of the most widely owned and actively traded stocks. Despite its tiny share price, this is a company with an enterprise value in the billions.

  • Report this Comment On June 18, 2009, at 2:05 PM, SatRadioMan wrote:

    Bigpeach:

    For some reason, this stock drives millions of emotional subscribers/shareholders which can see SIRI do no wrong.

    On the other hand, Rick cancels out most of these overly optimistic shareholders by throwing in negatives....in which MOST of the time, he is correct.

    Back on topic:

    No Stern and sports is ridiculous. Without them, there is VERY LITTLE exclusive content that can't be had elsewhere. Music, in particular, is done MUCH better by other apps such as Pandora/Slacker.

    Yet another blown opportunity for SIRI. Without the exclusive content, why bother?

    When will they wake up?

  • Report this Comment On June 18, 2009, at 2:10 PM, NoLoveForLifers wrote:

    I have 2 lifetime subscriptions - 1 for sirius and 1 for xm - both of which give me unlimited online streaming access to all the respective shows without having to upgrade to premium. I downloaded the new iPhone App this morning and it won't let me access anything without having Premium service. I emailed sirius/xm to let them know but haven't heard anything back.

  • Report this Comment On June 18, 2009, at 2:42 PM, smb405 wrote:

    I don't get it. What is supposed to set Sirius apart from it's competition (free apps/internet radio etc) is it's premium content ...(and just to add one more competitor... "Ootunes" has a fantastic web app...it isn't free but a one time $3.99 cost) . If you can't access the premium content on the iPhone then why bother going to the trouble to develop the app in the first place? What makes Sirius think that people will pay extra for non-premium content? Now I could care less if it has Howard Stern....nothing against him.....I just don't need him, but obviously there are many who were looking foreward to accessing his show with their iPhones (same with MLB etc.....I wish it had MSNBC).

    I signed up for the app this AM and I am ok with it for now with Radio Margaritaville, Bloomberg, ESPN etc, but I can also get all/most of those staions on Ootunes. So I am not quite sure how long I will keep the iphone app or even my Sirius car subscription for that matter. I will say the new app is pretty easy to manage. I was also hoping for a bigger jump in the stock price over yesterday....but I guess that's just wishful thinking now.

  • Report this Comment On June 18, 2009, at 2:43 PM, mikeefool wrote:

    There are some, er at least one, me, who only subscribe for the music. I was quite pleased when they offered the non premium subscription as I no longer have to contribute as much to the outrageously paid folks.

    I personally have no desire to waste time on the internet downloading music to then carry to my car, plug-in and listen to and repeat daily.

  • Report this Comment On June 18, 2009, at 2:56 PM, d13vk wrote:

    Sirius will fail because Howard isn't included on this - Howard IS satellite radio. Why even bother with this technology when you can get it for free with any number of free apps or websites. People are paying for a service to get something they can only get on this medium. I am pissed. I was waiting for this app for a long time. I was pissed when Sirius stepped in at the last minute and told Nicemac they couldn’t release an app. I hope this is a small hurdle and that it will be worked out, but my hunch is that Sirius screwed up again and this is literally the end.

  • Report this Comment On June 18, 2009, at 3:02 PM, cantbefoolish wrote:

    I was a bit disappointed to see the news about no Howard. But look at the bright side, it'll save me the $3 I would have paid to use the app. ;p

    What about the O & A army? Shouldn't they be happy to get those guys on the app instead of Howard? There were something like 9 million subs on XM before the merger. So, obviously there were a lot of people who liked the content, without Howard. Maybe they'll pay for the premium service.

  • Report this Comment On June 18, 2009, at 3:07 PM, jeffw101 wrote:

    It's now being reported on a few blogs that you can get the Howard Stern show daily podcasts. Whether this is legitimate or not, a search of Stern on itunes does reveal a daily podcast show. It doesn't say SiriusXM anywhere, so it doesn't seem legit.

  • Report this Comment On June 18, 2009, at 3:24 PM, oghowie wrote:

    A podcast is not the same as streaming radio.

    Was excited about this app until I learned there are more than a few missing stations.

  • Report this Comment On June 18, 2009, at 3:34 PM, jsl4980 wrote:

    This app is pointless without Stern. However that is probably due to the adult content on those stations which Apple automatically rejects any apps that can provide adult content (except their own web browser which can find porn with ease).

  • Report this Comment On June 18, 2009, at 3:49 PM, LOS54 wrote:

    Waaaaaaa! This is no different than if you want to get Sirius over the internet, this went into affect 4/9...So, for the price of Star Bucks coffee you can get Howard Stern.

  • Report this Comment On June 18, 2009, at 3:50 PM, Isaac86 wrote:

    You guys do realize that you can download the howard podcasts on itunes on your iphone right? The podcasts are only downloadable via the iPhone iTunes app (Sorry no itunes downloadable on MacOSX/Windows version of iTunes)

  • Report this Comment On June 18, 2009, at 4:07 PM, USIRIUS wrote:

    Hey Rickhead

    GUESS WHAT LOLOLOL HEEEEE'S BACK

    JUNE 18TH

    FREE HOWARD STERN!!!!!

    http://satwaves.com/blog/?s=howard+stern

  • Report this Comment On June 18, 2009, at 4:08 PM, USIRIUS wrote:

    http://satwaves.com/blog/?s=howard+stern

    Free Howard Stern Announced.

  • Report this Comment On June 18, 2009, at 4:20 PM, Isaac86 wrote:

    Usirius, I did post that you already can download the howard podcasts on iTunes through your iPhone, but thanks for posting a link to that blog. People need more information for sure.

  • Report this Comment On June 18, 2009, at 7:06 PM, maxstep wrote:

    When are you going to just throw in the towel on an industry whose time is about past. Four, maybe 5 more years and it will be only a little niche product. Get over it MF and all you Foolish followers.

  • Report this Comment On June 18, 2009, at 10:46 PM, jimlkirkpatrick wrote:

    I am wondering if the fact that Stern pulls in $500 Million in 5 years could possibly be part of the reason we are all paying so much for Sirius in the first place. And Siriously,, I am loosing confidence in how Sirius is spending....

  • Report this Comment On June 18, 2009, at 10:50 PM, jmarkh wrote:

    I just spent 30min setting up my iphone app with xm radio and the guy said he personaly set up 500 accounts today. I can only imagine how many customer reps are doing the same. I bet they will beat their predictions.

  • Report this Comment On June 19, 2009, at 3:38 AM, d600 wrote:

    Can smb. tell me, why siri's stock goes down, if it can be tuned in AAPL ? siri's stok opened high and went up around 0.42, and now is 0.32.

  • Report this Comment On June 19, 2009, at 8:36 AM, chriss25 wrote:

    Stern pulls in MORE than $500,000,000, At the end of his first year 2006 his contract was worth over $704,000,000. The hype he pulled while on Free radio in 2005 made the first 34,000,000 shares he got on the day he started worth $221,000,000. They were worth $100,000,000 on the day he inked the deal. No surprise for Stern. His listener numbers and paychecks are now under the radar. Later in the year Sirius posted an Expense debit for a $80,000,000 Stern bonus for subscription sign-ups. Now, with Stern, Retail subscriptions are Negative.

  • Report this Comment On June 19, 2009, at 10:05 AM, overbubba wrote:

    So he set up 500 that day. Lets say it takes 5 minutes of his time to set up an account that would be 41 hours of work.

    When i canceled 2 of my sub they said it was uncommon for people to cancel but 400,000 net loss sugest they might be less than credible.

  • Report this Comment On June 19, 2009, at 10:33 AM, BullishBroker74 wrote:

    By Brandon Matthews

    In a sickening media blitz that belongs in Iran rather than the United States, it appears that the most trusted news agencies are conspiring and search engines are being manipulated to eliminate any and all news of Sirius XM’s (SIRI) new Apple (AAPL) iPhone application, unless of course it deals with programming that is not available with the new application.

    Nowhere on a Google (GOOG) search will a user see a single announcement of the most anticipated Apple application in history. Instead, only headlines that read that the application is missing Howard Stern will be found. The same Howard Stern that the same media has been writing about for the last two years as being insignificant. Nowhere will you find the company’s press releases through PR Newswire nor Dow Jones Newswire, not to mention the thousands of blogs that have written about the story since it debuted at midnight on June 18, 2009.

    What you will see is republished articles from last July that have been re-released Thursday morning through the Associated Press as news that brings issues of Sirius XM debt to the top of search results. Debt mind you that was laid to rest back in February of this year. Did I mention this is from LAST JULY? A similar news story had been released through Fidelity on Sirius XM’s last run to recent stock price highs. Investors would like to know when the SEC might actually DO THEIR JOB? This type of flagrant media manipulation continues to go unchecked. The Atlanta Journal Constitution responded to complaints stating:

    “There is clearly some sort of technical problem today on either our end or Google News’ end. Our top tech folks are investigating because many of our old stories on a wide variety of topics are suddenly showing up toward the top of Google News results. This normally doesn’t happen, and we don’t WANT it to happen. I assure you we don’t deliberately promote old news as if it’s new. It doesn’t serve us or our readers.

    Thanks again for alerting us to the problem with the Sirius story.”

    Other “news” articles topping the search engines list of current news stories include 3 week old news that the company will be passing on royalty increases to subscribers; that Sirius XM “neutered” its iPhone app; and headlines that include the phrases “Are you Sirius?” or “Why am I still invested in Sirius.” AJC goes on to state:

    Oh, thank you for the screenshot! That’s very helpful.

    This may tie into another problem we’re wrangling, which is why a 2008 story about Tiger Woods is suddenly showing up among our most popular. I’ll pass your screenshot along to the folks who are investigating that one.

    We want Google News to be able to find our content, but not like this!

    Thanks again for the help. I assure you there was no deliberate attempt on our part to disseminate old news; this just falls into the category of “Something odd is happening."

    Just as the movie Stock Shock demonstrates, there seems to be a concerted effort on the part of Wall Street criminals in collusion with the mainstream media to put roadblock after roadblock in front of the Satellite Radio provider. Perhaps the recent legislation proposed by President Barrack Obama can be worded in such a way to include severe penalties for these intentional perpetrators of fraud on the American investor.

    Position: Long SIRI

  • Report this Comment On June 19, 2009, at 11:57 AM, cantbefoolish wrote:

    Yep, of course they want Sirius/XM to fail. It would be one less competitor. But do REAL Americans want this company to fail? So that we have less media options, and we can go back to having the religious right dictate what we listen to?

  • Report this Comment On June 19, 2009, at 12:01 PM, cantbefoolish wrote:

    And I agree, these guys like to talk about how insignificant Howard is, but when they can't get him on a free app - waaaaaaaahhhh!

  • Report this Comment On June 19, 2009, at 2:32 PM, chriss25 wrote:

    Stern IS insignificant. It's a fact that Howie brings in NO Retail. Retail is and has been Negative after Stern dropped his load.

    The problem is that the reporters don't know the facts... just like potential subscribers don't know the facts. Instead of Sirius being promoted for its music niche, everyone THINKS Sirius is all about Stern. Just poor marketing by Sirius.

    So now that insignificant Stern is not part of the app, the backlash initiated by this poor marketing is biting Sirus in the butt.

  • Report this Comment On June 19, 2009, at 3:00 PM, jmarkh wrote:

    is there a legal reason why they did not include

    Stern as an option with their app?

  • Report this Comment On June 19, 2009, at 3:02 PM, dividendhound wrote:

    Wow, another Sirius article. Siriusly?

  • Report this Comment On June 19, 2009, at 5:53 PM, vdronex wrote:

    Only fools trade SIRI...

  • Report this Comment On June 19, 2009, at 8:03 PM, cantbefoolish wrote:

    No, only fools sell their shares to me at $.06

    chriss25, if Stern is insignificant, then why would so many more people want the app if he was on it? including me. why are his topics often on the top google trends? why do the comedians on his show sell out when they perform at other places? why do the ratings on Letterman go up significantly, whenever he's on that show?

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