Althouse: Sirius XM, the bankruptcy.

February 10, 2009

Sirius XM, the bankruptcy.

Oh, no!

21 comments:

Mark O said...: I'll have to park the car. What about all Elvis, 13?; 2/10/09, 9:05 PM
Joe said...: It was obvious they were doomed the moment they paid $100 million for Howard Stern. It made absolutely no sense.

It doesn't help that Sirius XM programming sucks.; 2/10/09, 9:12 PM
The Dude said...: Pay radio - an idea whose time has come and gone, just like Obama.; 2/10/09, 9:16 PM
JohnAnnArbor said...: I really like mine. I started listening to out-of-area football games just for fun this fall. It was kind of interesting to here the local announcers call the game for the Vanderbilt Commodores or whatever. And the 80s station is usually fun, except for the 10% of the time it plays something I hate.

Maybe bankruptcy lets them out of the Stern contract.; 2/10/09, 9:23 PM
somefeller said...: This is bad news. XM freed me from the hell of Houston commercial radio. If it goes under, it's back to the CDs and public/collegiate radio.; 2/10/09, 9:29 PM
Sprezzatura said...: In the two and a half years I've had this is one of my cars I've listened to it at most a dozen times--only when I'm on a road trip and too lazy to browse the dial or there is limited terrestrial radio reception/options.

I won't miss it.; 2/10/09, 10:00 PM
Ann Althouse said...: I love my satellite radio! It will be terrible if this dies.; 2/10/09, 10:04 PM
Wince said...: The filing by Smurfit-Stone, with assets of $7 billion, has been the year’s biggest [Chapter 11 filing] to date.

I tried to tell you those little blue smurfs didn't know shit about business.; 2/10/09, 10:10 PM
Anonymous said...: Joe said...It was obvious they were doomed the moment they paid $100 million for Howard Stern. It made absolutely no sense.

They paid him in SiriusXM stock under agreement that he wouldn't sell it and it's now selling at $.11 per share off from a 52 week high of about $3.80 per share.

Howie lost a lot of money.

But he "works" only 4 days a week talking to perverts, losers, degenerates and celebrities.

Stern peaked 15 years ago.; 2/10/09, 10:13 PM
sg said...: I don't think it's as dire as the word "bankruptcy" implies.

On a operating basis, Sirius XM is doing OK.

The problem is they've got a huge amount of debt to service.

Once they convert that debt to equity ("haircuts for all"), they'll be OK. And that conversion is pretty much a given, the company and the bondholders being joined at the hip.

That having been said, once my annual subscription comes up for renewal in a couple of months, I'll be converting to month-to-month payment. Just in case...; 2/10/09, 10:14 PM
vnjagvet said...: I will miss it too. Especially stuff you can't get anywhere else like old time Lone Ranger and The Shadow shows. I was so disappointed when those programs came on TV because TLR looked like an old man, rather than the lean guy I imagined from Brace Beamer's voice. Now when I hear them again, I can understand why. They were very well done.

Nowhere in the pages of history could one find a greater champion of justice.; 2/10/09, 10:16 PM
Shawn Levasseur said...: I doubt that XM/Sirius will go out of business. But it will probably change hands once or twice along the way, and some of the big name (and big money) talent will have to be cast aside.

The satellites are up there, sunk costs, and somebody's going to use them.

I also think that to survive in an internet radio / iPod world, XM/Sirius will have to look beyond just their satellites. Pushing the value of their internet streaming and podcasts of original material will help them.

Unfortunately in a few months, their online streaming will no longer be a standard part of a subscription, but an extra to pay for. I understand they really need the added revenue now, but they also need to not piss off the customers who can just as easily listen to Pandora, Last.fm or many other free services online, and hook up their iPods to their car stereos.

Satellite radio is a good idea. But it came out about five to ten years too late.

Myself, I've been an XM subscriber since about January 2003 (not too long after the debut of the service) and will be dropping it as I listen more and more to the podcasts I have stored up on my iPod, and don't listen enough to justify the annual subscription fee.

(It also hadn't helped that higher gas prices for much of this past year have kept me out of the car, giving me less opportunity to listen to XM)

I'll miss the XM Comedy (or whatever they're calling it now), Cinemagic, BPM, and the ability to listen to ESPN Radio, and the various news channels in my car, but the cost doesn't equal the benefit for me.; 2/10/09, 10:24 PM
Sprezzatura said...: Do folks who will miss this have Sirius?

If so, what are some favorite channel numbers? After more than two years I don't know any of them. I think I found NPR on 13x, and rap on a few between 40 and 50. That's all I've bothered w/.

I suppose I could use the google to find a complete listing, but I prefer recommendations.; 2/10/09, 10:25 PM
Revenant said...: It was obvious they were doomed the moment they paid $100 million for Howard Stern. It made absolutely no sense.

Doesn't it? The $100 million is for Stern, his crew, and their production costs. Howard Stern apparently has 5 million daily listeners on Sirius. So Sirius is paying the around $1.67/month for each of Howard's listeners. The subscription fee alone is $13/month, and they get ad revenue on top of that.

So it could quite possibly be a good deal for them, depending on what percentage of Stern's listeners are subscribing specifically to listen to him.

They paid him in SiriusXM stock under agreement that he wouldn't sell it and it's now selling at $.11 per share off from a 52 week high of about $3.80 per share.

I'm pretty sure the stock payment was separate from the $500 million, 5-year contract. That was the stock was a bonus he got for reaching a subscriber goal or something like that, wasn't it?; 2/10/09, 10:31 PM
JAL said...: Bill Bennett has a great "talk" show from 6 am to 9 am on Sirius, as well as some regular radio stations across the country.

Good variety of music, funny, relaxed bantering with the team, but most of all excellent guests (Amity Shlaes (sp?) this morning) and thoughtful callers and discussions. All done with "candor, intelligence and good will."

One remarkable thing which the program reveals is the number of over the road truck drivers who listen and call in -- because of Sirius radio. Talk about hearing from regular people ... these folks are a part of America that I sense many in charge in Washington have no clue about. They are well read, well traveled, know the good places to eat between here and there ;-)! and generally demonstrate uncommon good sense.

Without Sirius I would miss their input. Hope it just reorganizes its debt, or whatever is involved.; 2/11/09, 12:04 AM
Lem Vibe Bandit said...: It never made any sense to me.

People paying to listen to the radio?; 2/11/09, 6:50 AM
bearbee said...: 15 Companies That Might Not Survive 2009

Moody's Investors Service, for instance, predicts that the default rate on corporate bonds - which foretells bankruptcies - will be three times higher in 2009 than in 2008, and 15 times higher than in 2007. That could equate to 25 significant bankruptcies per month.; 2/11/09, 7:04 AM
sonicfrog said...: And it just gets worse.... for somebody. Muzak files for bankruptcy. Yes, that’s the elevator music guys.

Yes, Feb 10th is the Day The Musak Died!!!!; 2/11/09, 8:28 AM
Joe said...: The subscription fee alone is $13/month, and they get ad revenue on top of that.

I thought Stern kept all the ad revenue generated from his show.

BTW, this is just chapter 11 bankruptcy. They could just be following the cable television market--create an expensive infrastructure, add deals that make no financial sense but get you going, go chapter 11, reorganize and then get bought by some big company.; 2/11/09, 9:43 AM
hdhouse said...: an absolute tragedy.; 2/11/09, 2:38 PM
RR Ryan said...: It may have changed since the merger, but I found it to be remarkably similar to NYC radio in the late 80's when they brought in the professional programmers; it was just too predictable. If it's 4:12 it's Ann Murray and Snowbird. Now it's the Fifth Dimension and One Less Bell to Answer so it must be 8pm. And it stayed that way for months. I finally yanked out the satellite radio and replaced it with a CD player. Slightly more work, but better fidelity and less repetition. By the way, I like Anne Murray and the Fifth Dimension.; 2/11/09, 6:37 PM