Singing something about old acquaintances being forgotten, RadioShack (NYSE:RSH) will stop selling DirecTV satellite television subscriptions. Instead, the consumer electronics retailer will sell exclusively EchoStar's (NASDAQ:DISH) DISH Network.
Makes sense. Satellite television had amounted to less than 5% of RadioShack's sales, and DirecTV has bigger fish to fry, having been sold off by GM Hughes Electronics (NYSE:GMH) to News Corp. (NYSE:NWS) in a beefy $6.6 billion transaction.
Moreover, for DirecTV, partnerships with retailers like RadioShack and Blockbuster (NYSE:BBI) haven't been as fruitful as hookups with chains like Best Buy (NYSE:BBY) and Circuit City (NYSE:CC). After all, folks head to Blockbuster to rent a flick or a video game, and the RadioShack crowd is looking for batteries and cables.
As for RadioShack, it's still struggling to replace the sales that shriveled after the computing world gave up on Tandy systems, and given the chain's plentiful small box outlets, selling third-party services seemed logical. Indeed, while satellite television may not be ideal, there's no reason why RadioShack won't be able to move lower-ticket services like satellite radio subscriptions for Sirius (NASDAQ:SIRI) and XM (NASDAQ:XMSR) or prepaid wireless plans.
"Feel the Joy" may be the DirecTV slogan, but RadioShack investors have been feeling the pain. The stock has been halved over the past four years. But at just 16 times next year's profit targets, maybe going against DirecTV's lead -- and sticking with RadioShack -- may be the best value move right now.
So do you think RadioShack is still relevant these days? How would you spice up the concept? All this and more -- in the RadioShack discussion board. Only on Fool.com.
