XM, Sirius gear up for holidays, holiday price wars
Christmas Christmas time is here, time for joy and time for cheer. And also time for XM and Sirius to duke it out old-skool, because the holiday season is all about spending with abandon. Both companies are expecting huge growth in the fourth quarter of ‘05 thanks to holiday spending, and competition is fierce.
Both companies are offering satellite radio receivers for under $50 after rebate, and both companies are currently charging $12.99/mo for subscription. Both companies are getting ready to debut their portable mp3-style players at the same time. Howard Stern is making an impact on Sirius subscription (his radio debut is in less than three weeks) but the leaders, XM have Opie and Anthony, not to mention a little thing called Major League Baseball.
All these acquisitions and price drops are costing the companies dearly, but…
For the companies themselves, the race is on to achieve profitability as they make hundreds of millions of dollars’ worth of investments in programming. For the third quarter, both XM and Sirius reported net losses of more than $100 million. Profitability is expected a few years from now as subscribers sign up.
Maybe next year will be the year that sat radio finally becomes profitable. There’s not much left to acquire, really. Soon we’ll know: will it be a Merry XMass, or a Blue Christmas for all?
