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Stern Is Synonymous With Sirius

By Rick Munarriz – Updated Apr 6, 2017 at 2:03PM

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Howard Stern replacing Simon Cowell? I don't think so.

Sirius XM Radio (NASDAQ:SIRI) fans can thank New York Post's gossipy Page Six column for giving Howard Stern more leverage in contract negotiations.

According to the report, Stern is the top choice to replace Simon Cowell after this season's American Idol. "It might be possible," he told radio show listeners yesterday. "We'll see."

Stern is in the final year of his five-year deal with Sirius XM Radio. It's only natural for the magnetic Stern to draw interest. The morning show host has previously confirmed that even terrestrial radio operators have opened the door for his return to traditional radio.

None of this seems likely, though.

For starters, let's go over the reasons why Stern and Idol aren't exactly a perfect fit.

  • Stern has shown an interest in scaling back his work commitments. This doesn't sound like the kind of approach that would fly, given all of the traveling that Idol judges do during regional auditions.
  • Will Stern be as ruthless as Cowell? You bet. However, Stern also crosses lewd and sexist lines that would make him more than merely villainous on the show. A selectively polarizing figure can influence viewer voting sentiment -- damaging the show's credibility.
  • After consistently badmouthing and testing the mettle of censors and regulators during his terrestrial run at what is now CBS' (NYSE:CBS) Infinity, can we really expect a prolonged tenure, given the mostly live nature of the show airing on News Corp.'s (NYSE:NWS) Fox?
  • Stern has a quick wit and a wicked tongue, but what about his ear? He should have no problem discerning between good and bad crooning during the early rounds, but does he have the skills to split hairs between great singing and merely really good singing when it matters most?

None of this matters, for now. Stern is simply benefitting from one more potentially interested party to make sure that he can milk the best contract possible out of Sirius XM CEO Mel Karmazin.

Karmazin seemed to have all of the leverage when Sirius completed its merger with XM in late 2008. Stern wouldn't have XM bidding against Sirius for his services. It has been suggested that Stern can strike out on his own with a premium-streaming model. Now that Apple (NASDAQ:AAPL) and Research In Motion (NASDAQ:RIMM) have tens of millions of smartphone subscribers tethered to the Web, it's certainly a niche where Stern could command a healthy living. However, all of the chatter of Idol or terrestrial radio seems farcical at this point.

Is there really any doubt as to where Stern will be come next January? All of this noise may cost Karmazin -- and Sirius XM shareholders -- a bit more than they were hoping to pay in securing Stern for a few more years, but it's going to happen.

Where do you see Howard Stern broadcasting from in 2011? Share your thoughts in the comments box below.

Apple is a Motley Fool Stock Advisor recommendation.

Longtime Fool contributor Rick Munarriz is a subscriber to both Sirius and XM. He does not own shares in any of the stocks in this article. He is also a member of the Rule Breakers analytical team, seeking out the next great growth stock early in its defiance. The Fool has a disclosure policy.

Stocks Mentioned

Sirius XM Holdings Inc. Stock Quote
Sirius XM Holdings Inc.
$6.24 (-2.65%) $0.17
Apple Stock Quote
$147.81 (-0.34%) $0.50
Paramount Global Stock Quote
Paramount Global
$20.38 (1.04%) $0.21
BlackBerry Stock Quote
$5.20 (2.36%) $0.12

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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