Sirius XM Radio

Posted on October 5, 2014 by areeves

by Allie Reeves

[1] SiriusXM Logo

The Sirius Story:

Sirius XM Holdings Inc. is a satellite radio service that offers commercial-free streaming on over 175 channels in the United States and Canada. These channels are comprised of every type of radio – music, news, sports, talk, and more [2]. It is currently the largest radio broadcaster and caters to about 26.7 million subscribers [3].

[30] SiriusXM Programming

Currently, the most popular way for subscribers to enjoy SiriusXM Radio is in the comfort of their cars. SiriusXM has arrangements with over forty automakers for installation of their services directly into the vehicle [3]. However, as of recent, SiriusXM has become available to stream directly online in your home or office, as well as an app that can be accessed on Smartphones and Tablets.

SiriusXM currently offers three different packages: Sirius Select, Sirius All Access, and Sirius Mostly Music. The packages can be bought on a monthly or annual basis and range in price from $9.99 to $199 [4].

[4] Most Popular Packages for SiriusXM Customers

The Sirius Team:

[6] Scott Greenstein, President & Chief Content Officer

[5] James E. Meyer, CEO

[7] Patrick L. Donnelly, Executive Vice President and General Counsel

Finances:

[31] SiriusXM finances as of December 1, 2014

SiriusXM recently released their 2014 Third Quarter Results, which revealed a 10% increase in revenue since this time last year, putting the company at a record high of $1.1 billion. This is higher than analysts originally anticipated for the company, as they put the company’s assumed revenue at $1.04 billion. The company also increased its subscriber count by 1.2 million [8].

Interest in shares of SiriusXM increased rapidly during the month of November. As of November 14^th, there has been an increase of 2.8% since October 31^st up to 247, 283,696. The company is now up to a $3.75 price on their stock [32].

Competitors:

[11] Apple Inc. Logo

SiriusXM’s current competitors are Apple and iHeartMedia, as well as regular terrestrial radio. Pandora and Spotify have also been named as competitors, but in a recent interview with James Meyer, CEO of SiriusXM, the two services were ruled out.

[12] iHeartMedia Logo

Meyer explained these companies are streaming services, which he doesn’t view as competition, but as its own distinct technology. Meyer also stated that out of them all, terrestrial radio is their primary competition, with 220 million people that use it everyday [9].

However, with Apple’s new CarPlay, that might not be the case for much longer. CarPlay gives drivers access to all of their music, podcasts, and audiobooks with the touch of a button, and major auto companies like Mercedes-Benz, Volvo, and Ferrari are already on board. The venture is still in its early stages, but since SiriusXM is primarily used by vehicle subscribers, CarPlay could end up being a serious competitor [10].

[13] Apple CarPlay

The Sirius Edge:

What sets SiriusXM apart from its competitors at Apple, and iHeartMedia is the company’s original content that can only be accessed through subscriptions to SiriusXM.

[15] The Howard Stern Show, one of the most popular talk shows on SiriusXM

Some of the most popular original content shows include The Howard Stern Show, The Oprah Winfrey Show, and NFL Radio, although many more are available [3]. This original content helps keep subscribers tuning in, and keeps SiriusXM’s churn rate at an impressive 1.9%. It also helps the company keep their acquisition costs low, which has recently become problematic for companies like Pandora [14].

[17] SiriusXM Town Hall Event in the Fishbowl

SiriusXM is also known for their “Town Hall” Series. These intimate gatherings take place in the SiriusXM fishbowl, a private listening studio, where entertainers sit down with a live studio audience comprised of about 30 SiriusXM subscribers who have won an invitation to the event [16].

[19] Taylor Swift at a Town Hall Event for SiriusXM

Recently, SiriusXM was able to snag Taylor Swift for a Town Hall Event. Subscribers had the chance to ask her questions and listen to songs off of her newest album, 1989. This event comes after Swift’s recent decision to pull her music off of Spotify, giving even more leverage to SiriusXM [18].

The Today Show for SiriusXM:

This past year, SiriusXM announced a major deal with NBC, in which simulcasts of the hit NBC show, The Today Show, would be broadcasted on the satellite radio service. The format of bringing a morning show to radio has been done before, unsuccessfully. However, what makes this different is that SiriusXM will not be airing segments of the popular morning show, they will be airing the program identically as it airs on television [20].

[24] The Today Show

This move was a strategic boost for both companies. The show airs during popular morning drive time, when radio listening is at its highest. The deal will allow NBC to access SiriusXM’s 26 million listeners, and SiriusXM hopes to draw in more subscribers that are already fans of the show.

[21]

Suing Sirius:

SiriusXM has come under fire in the past year over use of music recorded before 1972. More recently, individual bands have started going after the company, claiming that they deserve compensation. Although songs recorded before February 15^th, 1972 are not covered by federal copyright law, some artists and labels have been seeking protection under individual state laws – and the courts have been agreeing. As of November 17^th, the 1960s rock band, The Turtles, has had two victories against the satellite radio company [22].

[25] Rock Band The Turtles in the 1960s

The court ruled that music recorded before 1972 still has a public performance right and that digital services cannot use it without permission or compensation. SiriusXM has requested to dismiss the lawsuit, but it has been rejected. The judge ruled that SiriusXM has until December 5^th to show any factual issues that would be cause for a trial. If none are found, she will rule in favor of the band, and “assess damages” [23].

What’s Next:

[28] Joel Osteen

SiriusXM recently announced that Golf Hall of Fame member Sir Nick Faldo will receive his own show, where he will talk golf and get to know golf enthusiasts, while they get a chance to know him [26]. SiriusXM also launched a new pop channel, Venus, as well as adding some of their popular internet only channels like Y2Kountry and Utopia to their satellite lineup. Joel Osteen Radio will also be coming to SiriusXM, a station rooted in the power of “positive thinking with messages of inspiration” [27].

[33] Holiday music channels at SiriusXM

SiriusXM is currently celebrating the sounds of the holiday season with the addition of two new Holiday Music channels, Holly and Holiday Traditions. They plan to release more within the upcoming month [33].

Also effective January 2015, there will be an increase of 1.4 percentage points in the U.S. Music Royalty Fee applied to most SiriusXM audio packages, in order to fund royalty payments to the music industry [29].

Sources

1. SiriusXM’s Logo 2014, Fbnstatic.com, RT: 11/20/2014

2. What is SiriusXM?, Siriusxm.com, RT: 11/20/2014

3. Corporate Overview, Siriusxm.com, RT: 11/20/2014

4. Our Most Popular Packages, Siriusxm.com, RT: 11/20/2014

5. Chief Executive Officer, SiriusXM, Siriusxm.com, RT: 11/20/2014

6. President & Chief Content Officer, SiriusXM, Siriusxm.com, RT: 11/20/2014

7. Executive Vice President and General Counsel, SiriusXM, Siriusxm.com, RT: 11/20/2014

8. “SiriusXM Reports Third Quarter 2014 Results”, Investor.siriusxm.com, RT: 11/20/2014

9. “Sirius XM CEO: I Don’t See Spotify As A Direct Competitor”, Benzinga.com, RT: 11/22/2014

10. “Is Apple’s New Toy a Sirius XM or Pandora Killer?”, Fool.com, RT: 11/22/2014

11. Apple Inc. Logo, Worldofdtcmarketing.com, RT: 11/22/2014

12. iHeartMedia Logo, Billboard, RT: 11/24/2014

13. Apple Car Play, Uncrate.com, RT: 11/24/2014

14. “Sirius XM’s Main Edge Over Competitors”, Fool.com, RT: 11/28/2014

15. The Howard Stern Show, Tuaw.com, RT: 11/22/2014

16. SiriusXM Town Hall, Siriusxm.com, RT: 11/20/2014

17. SiriusXM Fishbowl Event, Howstuffworks.com, RT: 11/28/2014

18. “Taylor Swift’s Exclusive 1989 “Town Hall” to Air Live on SiriusXM”, Investor.siriusxm.com, RT: 11/24/2014

19. Taylor Swift for SiriusXM, SiriusXM Blog, RT: 11/22/2014

20. “Starting in June, ‘Today’ Will Simulcast on SiriusXM”, New York Times, RT: 11/28/2014

21. Today Show Radio on SiriusXM, YouTube, RT: 11/28/2014

22. “Rock band wins again in copyright battle against Sirius XM”, The Times of India, RT: 11/28/2014

23. “New York Court Delivers Third Strike Against Sirius XM on Pre-1972 Sound Recordings”, Sound Exchange, RT: 11/28/2014

24. Today Show Logo, Momsdemandaction.org, RT: 11/28/2014

25. The Turtles, Allmusic.com, RT: 11/28/2014

26. “Sir Nick Faldo to Host SiriusXM Show”, Techsonian.com, RT: 11/28/2014

27. New Channels and Lineup Changes, Siriusxm.com, RT: 11/20/2014

28. Joel Osteen, Lightsource.com, RT: 11/28/2014

29. “U.S. Music Royalty Fee Effective January 5, 2015”, Siriusxm.com, RT: 11/28/2014

30. SiriusXM Programming, Siriusxm.com, RT: 11/20/2014

31. SiriusXM Financials, Google, RT: 12/1/2014

32. SiriusXM Stock Information, Watchlistnews.com, RT: 12/1/2014

33. Holiday Music at SiriusXM, Siriusxm.com, RT: 12/1/2014

Sirius XM Radio

Posted on November 3, 2013 by Stephanie Bronfein

By Stephanie Bronfein

The official SiriusXM logo, courtesy of siriusxm.com [1]

SiriusXM Satellite Radio

1221 Avenue of the Americas

New York, NY 10020

www.siriusxm.com

Social Media: Facebook, Twitter, Instagram, YouTube

History [2]:

SiriusXM Radio is one of the largest radio broadcast and subscription media companies in the United States that provides original content to 25.6 million subscribers. Their commercial-free programming covers a diverse range of music, sports, talk, entertainment, traffic and weather shows, with celebrity personalities such as Howard Stern, Oprah Winfrey, The Grateful Dead, Pearl Jam and Tiesto. While the most popular way that consumers experience SiriusXM Radio is through satellite radio in their cars, it is also available for the home or office and can be streamed through SiriusXM Radio’s website or through Apple and Android mobile applications.

Key Executives [3]:

James E. Meyer – CEO

Scott Greenstein – President & CCO

Dara Altman – Executive VP & CAO

David J. Frear – Executive VP & CFO

All photos courtesy of SiriusXM Radio. For more information on the company’s executives click here.

Financial Standing:

SiriusXM Stock Change from 11/12 to 11/13, courtesy of siriusxm.com [4].

With 36 million shares to its name, SiriusXM Radio’s stock value sits at $3.68, with a 52-week high of $4.18 and a 52-week low of $2.67 [4]. Since the third quarter of 2012, the recorded revenue has increased 11% to $962 million. The adjusted EBIDTA increased 21% to a new record of $296 million and free cash flow increased 26% to $245 million [5].

Liberty Media Takeover:

Liberty Media Logo, courtesy of forbes.com [9].

SiriusXM Radio shareholders finally spoke up this August about Liberty Media Corporation gaining control of over 50% of the company, which resulted in former Chief Executive Officer Mel Karmazin leaving the company, along with a string of other directors. In 2009, when SiriusXM Radio was considering filing for bankruptcy, John Malone of Liberty Media offered a $530 million investment to get the subscription satellite radio company back on its feet. This deal allotted 40% control over the company to Malone and included a three-year grace period where Malone could not acquire a controlling interest in SiriusXM Radio’s shares [6].

In light of this period’s expiration at the end of last year, SiriusXM Radio shareholders failed to find a loophole in the investment-agreement terms to prevent Malone from buying out the company, so he did just that. What’s more, Malone didn’t allow other shareholders to vote on the deal. This is the main contention that SiriusXM Radio shareholders have against Liberty Media. Shareholders even went as far as suing the SiriusXM Radio board of directors in Aug. 2012 for not creating a strong enough defense against the Liberty Media takeover in the original investment-agreement [7].

As of the end of August, SiriusXM Radio share value has increased more than 2,160% at $3.62 since the Liberty Media investment was made, where shares were valued at as low as $0.16 [7].

Liberty Media also holds controlling shares of the Atlanta Braves, Leisure Arts, Inc., MacNeil/Lehrer Productions and TruePosition, Inc [8].

SoundExchange Sues SiriusXM:

SoundExchange Logo, courtesy of forbes.com [10].

On Aug. 16th, SoundExchange filed a lawsuit against SiriusXM Radio for $50 to $100 million in damages, claiming that the radio provider underpaid artist royalties from 2007 to 2011 [12].

SoundExchange is an independent nonprofit organization that has been designated by the Copyright Royalty Board to collect digital performance royalties from statutory license users—such as SiriusXM Radio—for the purpose of distributing those royalties to the rightful copyright owners and artists. As the only Satellite Digital Audio Radio Service in the country, it has been decided by the Copyright Royalty Board that SiriusXM Radio should pay a federal statutory royalty rate to avoid penalty of copyright infringement for the public performance of sound recordings that they do not own (via transmitting them to their subscribers). This rate is applied to the gross revenue as defined by the Copyright Royalty Board, which was settled between 6-8% for the years of 2007 to 2012 [11].

At the root of the lawsuit, which is compromised of four different counts against SiriusXM Radio, is a claim that the gross revenue has been reduced without proper authorization from the Copyright Royalty Board, causing a multi-million dollar underpayment to SoundExchange [11]. Essentially, SiriusXM Radio has been cornered for their bad accounting.

From their reported gross revenue, SiriusXM Radio excluded revenue collected from pre-1972 sound recordings, incremental revenue on SiriusXM Radio’s premier subscription package and two additional subscription packages that include both music and talk programming [12]. On top of these three counts against SiriusXM Radio is a claim that they did not pay late fees to SoundExchange on time—in part due to the fact that they didn’t know that they apparently owed SoundExchange millions of dollars—and SoundExchange expects to collect interest on these late fees [13].

While copyright law does not protect pre-1972 sound recordings, the Copyright Royalty Board requires that those who publicly perform them must separately recognize the attributed revenue generated—if SiriusXM Radio chooses to exclude this revenue from the reported gross revenue to SoundExchange, the deduction must be precise and the methodology transparent. Since SiriusXM Radio does not distinguish the revenue made from different kinds of music programming, the percentage that they attribute to the pre-1972 sound recording revenue can only be defined as an assumption, and is therefore unlawful [11].

SiriusXM Radio excluded incremental revenue that was garnered from the pricing difference between its standard package and its premier package. While the subscription satellite radio service is allowed to exclude channels that don’t include music programming—and the premier package only gives consumers additional talk/news programming—the additional channels offered in the premiere package aren’t offered for a separate charge [12]. In plain, the premier package also includes all of the programming from the standard package, meaning that it unlawfully excludes publicly performed sound recordings from its reported gross revenues [11].

In the same vein, SiriusXM Radio excluded revenue from the Family Friendly and Mostly Music packages, which were originally offered from XM Radio before the merger and contain both music and talk programming. The publicly performed sound recordings in these packages are supposed to be covered by a statutory license. Once again, SiriusXM Radio did not spell out the method by which they separately recognize revenue garnered from music and talk channels in these packages, therefore making the reduction from gross revenue unauthorized by the Copyright Royalty Board [11]. Of all the exclusions, this one makes the least sense.

At the time that this post was published (Nov. 20th, 2013), SiriusXM Radio has declined to comment on the lawsuit and no progress has been made to the public in regards to securing a jury trial date.

New Programming:

David Bowie, photo courtesy of billboard.com [14].

David Bowie’s Limited-Run Station [14]:

From October 30th through November 12th, SiriusXM Radio ran a limited-time station revolving around David Bowie’s latest album, “The Next Day,” which premiered on November 5th. As a promotional effort for the album, the station revealed five songs from an expanded version of the album. Other programming included rare demos, covers and live performances of Bowie’s.

Danny Howard, photo courtesy of billboard.com [15].

UK DJ Danny Howard Brings EDM radio show to BPM [15]:

Premiering December 5th on the BPM station, Danny Howard will join an elite group of European DJ’s to showcase what’s hot in the UK and European electronic dance music scene. With this weekly show, he hopes to break DJs and producers from his side of the pond that might not have gotten stateside exposure. Prior to accepting this stateside residency with SiriusXM Radio, Howard hosted a show on BBC Radio 1 titled, “Dance Anthems with Danny Howard.”

21st Century FOX logo, photo courtesy of 21cf.com [17].

FOX Business returns to SiriusXM Radio [16]:

Originally dropped in 2008 after Sirius Satellite Radio merged with XM Satellite Radio, FOX Business reclaims its spot next to FOX News as another 21st Century Fox radio station. With their nationally regarded collection of personalities, the stations are sure to attract a wide audience with their discussion of news, politics and current affairs. The deal is set to last through 2019.

Sources:

1. SirusXM Logo

2. SiriusXM Corporate Overview

3. SiriusXM Key Executive Bios

4. SiriusXM Stock Quote

5. SiriusXM Third Quarter Financial Results

6. Bloomberg Article on SiriusXM Investor’s Being Shortchanged by the Liberty Media Takeover

7. Billboard Article on SiriusXM Shareholder’s Position on Liberty Media Takeover

8. Liberty Media Asset List

9. Liberty Media Logo

10. SoundExchange Logo

11. SoundExchange Sues SiriusXM Radio – Filed Complaint