Satellite Radio (Sirius XM) is going to deadpool

written by: Patrick Wong | category: Deadpool | posted: 11/30/08

I hate to say this but I have to admit that Satellite radio is going down like a meteor, it’s a matter of time until it hits the ground. Sirius XM Radio being the king of Satellite radio is already living on borrowed time and borrowed money!

First of all, I’m not against satellite radio, in fact, I have a subscription since 2002. I listen to satellite radio all the time, my favourite show is “Howard Stern”. Sirius XM has $3.4 billion in long-term debt, $1 billion of which is due next year and $300 million of that due by February. The stock dropped from over $60 per share (in 2000) to all-time low $0.14 per share (in 2008). That’s like 99.8% losses! Here’s some reasons why I think Satellite Radio is doomed.

1. Rise of MP3 phones

Cell phones in general, and the iPhone in particular, are mainstreaming the idea of listening to music. Since people carry their cellphone(s) everywhere, this reduces the time to listen to radio. Why pay extra for Satellite radio in this gloomy economy? General Motor (GM) is one of the biggest supporters of Satellite Radio suffered a 45% reduction in new car sales, and facing the verge of bankruptcy.
2. Rise of entertainment devices in cars

Many cars have built-in TV with tons of channels, ability to connect your iPod/iPhone, and/or support of AUX, even connect to your game consoles. All these functions is monthly FREE, no need to subscribe to the service.

3. Mobile broadband dashboards

Cars are increasingly getting cellphone wireless connectivity built-in to their dash, starting with the same luxury automobile categories that are most likely to offer satellite radios. Once your car have Internet connection, who cares about Satellite Radio right?

4. Podcast

This “talk radio” delivery system is growing slowly but the benefit of this service is FREE.