Shareholders had to wait a long time for the urge to merge at Sirius XM Radio
Sirius XM is introducing MiRGE this morning, the first interoperable satellite radio receiver. When it officially rolls out in a few months, owners will be able to easily switch between XM and Sirius services.
Don't be fooled by existing subscription plans that offer select content from both services for $4 more than the regular $12.99 monthly offering. The old receivers will never get all of Sirius and XM, as the tightened compression would degrade the audio quality.
If consumers want all of Sirius and all of XM, this is the $250 receiver they will need to get. $19.99 is what they will have to pay a month. Do the math and you can see how important the MiRGE will be for Sirius XM, especially given its model of high fixed overhead costs but low variable expenses.
One can always argue that Sirius should have unleashed MiRGE before axing over a dozen music channels in November. Since so many of the music channels are now redundant on both services, the $20 monthly price point may be a bit steep. However, that's about the only drawback to the MiRGE.
Ideally, the new receiver will get satellite radio selling again at the retail level. Sirius XM is a staple at consumer electronics and discount department stores. Its own press release points out that the receivers are sold through Best Buy
Interoperable radios will also be a refreshing option down the line for car manufacturers. Sirius XM has deals in place with all of the major car manufacturers, but only about half of new car buyers keep paying for Sirius or XM after their free trials run out. Most automakers are tethered to just one brand. Ford
Satellite radio needs this, now more than ever with its shares trading for Chiclets.
More news than static on Sirius XM:
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Longtime Fool contributor Rick Munarriz subscribes to both XM and Sirius. He does not own shares in any of the companies in this story. He 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.