Sirius XM Radio (NASDAQ:SIRI) is giving itself two weeks to win back departed subscribers and owners of dormant satellite radio receivers.
The media giant will turn on all of its sleeping receivers tomorrow, giving freeloaders two weeks to preview 60 commercial-free music channels, as well as sports, news, talk, and entertainment programming.
Sirius XM has followed premium cable movie channels with these previews before, but I can't recall the last time that the taste test lasted this long.
The satellite radio provider knows what it's doing. A dormant receiver is no different than an empty hotel room or a vacant seat on a plane. It doesn't cost Sirius XM anything to activate the devices, and even if a sliver of those taking the preview find themselves smitten by Sirius or XM and hop on as paying subscribers, it will be an incremental victory.
These are interesting times for Sirius XM, with the stock trading near its four-year high.
Liberty Media finally took majority control of Sirius XM this month, wasting no time in reshaping the company by shaking up the board last week.
Sirius XM's personalized radio is also now in beta. Media watcher SiriusBuzz kicked the tires over the weekend, and while Spencer Osborne applauds the efforts of customized curation, he's not exactly sold on it being a game changer for investors.
I don't necessarily agree. Pandora (NYSE:P) owns this space, and will continue to do so when it comes to free ad-supported music discovery. Pandora served up 1.39 billion hours of content last month, and that will continue to increase. However, on the premium end -- with the handful of Pandora subscribers who are actually paying for commercial-free access -- MySXM could be a material contributor here.
There are 23.9 million Sirius XM subscribers, and it only costs receiver-based subscribers $3.50 a month for streaming access. It's a rate that's comparable to Pandora One and far cheaper than Spotify. MySXM clearly improves the value proposition of streaming, and that could push average revenue per user higher in the coming months.
We'll see how this all plays out. For now, Sirius XM is ready to flip the switch tomorrow on millions if not tens of millions of dormant receivers.
Offering up a taste of satellite radio on a toothpick should prove to be pretty tempting bait.