According to the NYT, Sirius XM owes $175 Million by the end of February and it may not be able to pay up. Bankruptcy may very well be in the cards for the Satellite Radio super-organism. The article cites a failure to “to win over many younger listeners” and the general economic downturn.
Sirius XM Prepares for Possible Bankruptcy [NYT]
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Can I just say the the Sirius mascot turned upside-down looks like a decapitated, pregnant stripper? Thatisall.
The problem is they have high monthly prices. Honestly it should be like $5 a month at most. The flip side is it cost them so much in R&D for the radios and a mountain of money to get those satellites into space that they have no choice but to charge a high fee until they pay off their debt. So they are stuck between a rock and a hard place here.
I hope they dont go away because I cant live without Howard Stern. He may retire in a couple years but I hope not. If he does and Sirius is still the current price I will quit. I hate regular radio and I love music on Sirius but I have an ipod and a G1 (google phone) with an 8 gig memory card which I can hook up to my car radio so…i can live without Sirius if Stern isnt there.
@parad0x360:
Iridium had the same problem. It was solved by going bankrupt, then having another company buy the system for pennies on the dollar.
I have XM/Sirius on my Saturn ION, and I called recently to discontinue the service. The person at the desk asked me if I was willing to keep XM/Sirius on my car for just $5 a month for five months. I said yes.
Glad I did; they finally put Sirius’ GLBT channel on my XM service. If you’re on the fence about keeping the service, call the company. You might get a deal to stay on, at least for a short time.
Yep , they are on their way out .
@Jeremy Wentworth: I am curious.. why do you like the service? Why not just get an iPhone with the last.fm app or something? Is it the stereo integration? I’ve always thought satellite radio was an odd idea given that radio seems a bit obsolete…
In the daily trades today they mentioned that they have a $400 million debt repayment coming due at the end of the month and they are very short of the cash needed to pay it.
They are beginning the paperwork to file Chapter 11, and in doing so they will be able to get out of expensive long term contracts like they have with either MLB or the NFL.
The president of EchoStar (the Dish Network folks) has been snapping up Sirius stock, and has apparently wanted to either purchase or hostile takeover the company. The Chapter 11 filing may force him to play his cards now and get the company and it’s satellites at a bargain price, rather than having to try and buy it during the sale that could happen after the bankruptcy.
If they die it will be good for terrestrial radio, which is helpful, seeing as how I work for a radio company.
Sat. radio mostly appeals to people with ADD. But now they have advertising breaks on some channels and their djs talk to much. And they need to face the fact that it’s never gonna be easy to compete against iPods stuffed with kajillions of illegally downloaded songs.
Disclosure: I’ve been an XM customer since almost day one and, in my professional life I handle XM for business as one of my product offerings. That having been said…
I’m don’t have an MBA so can someone explain to me how a failing company (Sirius) can merge with a more healthy company (XM), become the dominant partner and then impose the same failing business practices that was tanking them on the healthier one? As the company continues to tank the stock holders do allow this misguided CEO to continue and do nothing? Is everyone asleep there? Is Mel a shill for the terrestrial broadcasters?
Given the fact that XM Weather is now used by all of the major airlines as well as general aviation, will the government allow them to tank? Will the government bail them out or will they spin off? Are we looking at another Iridium deal here?
Gee, I guess paying all that moola to Stern has finally caught up with them? Can’t you hear Sir Howard and his fans sucking on their thumbs in anguish?
That’s what they get for providing non service and poor selections to “new car buyers” that could afford auto internet radio. How about only 3 Jazz stations versus the hundreds on my home PC…Duh! Get real or get out!
Not surprising ,when I heard Howard Sterns initial contract I was like what the heck .He may be popular but will people actually pay to listen to him-in the morning .He’s just a symptom .
All these companies say things like ‘ well it’s only x dollars of month ‘ .The problem is ALL of those companies .People with Sirius XM probably had other expenses per month,others with Sirius XM now have other expenses with more priority .
These companies are NOT just competing with in their own industry they are competing with every other company and industry for your dollar .How much disposable income did they really think was out there .
It’s a shame. I signed up for XM online. Only 7 bucks a month. I never bothered buying a radio for my car. I usually listen to NPR anyway.
I work on computer all day at work and Xm online makes my day go by so much faster. I hope they pull through.