'Old' Radio Outperforming XM & Sirius Radio
A few years back XM and Sirius Radio were touted as the companies that would put old radio out of business. People were scrambling to jump on the new products and Howard Stern signed a huge million dollar deal with Sirius. To most, it appeared within a few years most Americans would jump on the satellite radio boat, and FM and AM radio would be a thing of the past.
However, according to the article, the complete opposite has happened. XM and Sirius are desperately trying to keep their heads above water by a last ditch effort of the two competitors merging companies. Shares of both comapanies are down 30% from the last year, while smaller terrestial radio companies stocks are rising (Cox Radio-5%, Saga Communications-9%). Furthermore, the nation's largest radio station owner, Clear Channel Communications, is up 22.5%.
It appears that consumers have considered the opportunity costs of having XM and Sirius, and concluded that no commericals and more music choices are not worth the $10 per month.
2 comments:
I have sirius radio and i like it alot. I think that many people don't realize the vast amount of options that you can listen to. Not only is music available, but there are also things like nascar, nba, nfl, baseball, ... For me, the cost of the radio is well worth it, especially on long drives.
I see the side that American's are tending to go towards...AM and FM. Although the songs are played over and over, there are still many options, and most people like more than one type of genre so if they get tired of one channel, they can flip to another. It doesn't seem to matter that they are listening to commercials, and a lot of people simply switch channels on those times, too. I am sticking to the radio, because I don't personally think I listen to it enough to be worth the money. I mean, really...some things in life are truly meant to be free!
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