If Satellite Radio Went Away Tomorrow

Okay, the reported pending Sirius XM Radio bankruptcy filing is a reorganization, hastened by a potential struggle for control of the company, it’s not a liquidation. But you can be sure it’s already inspiring no amount of wishful thinking on the terrestrial radio side. “Satellite radio crashes,” reads the headline in this morning’s Inside Radio. So there are undoubtedly broadcasters this morning licking their chops and wondering, “Well, what if Sirius XM does go away?”
That one isn’t hard to answer. If Sirius XM suddenly ceased to exist tomorrow, it would in no way “solve everything” for terrestrial commercial broadcasters, who have already gotten way too excited about satellite radio attracting “only” 20 million subscribers. Local stations will not automatically repatriate all those listeners. And here’s why:
For starters, Sirius and XM, as separate services, found their early adopters in the people who were never going to be satisfied with mainstream terrestrial radio. That wasn’t a large enough number of people to make satellite profitable. It wasn’t as large a group as the daily newspaper radio/TV writers (many of whom fell into the group themselves) would have liked to believe. But it’s still a few million people who aren’t coming back. And you can ask the PD of any commercial Triple-A station if those listeners have been missed in recent years.
More important, Sirius and XM also changed the expectation of 20 million listeners. Those listeners are comfortable with radio being national – not that terrestrial broadcasters haven’t been helping the rest of us with that transition. They are accustomed to commercial-free music, particularly when choosing a station for a public place. They are no longer willing to wait for “traffic on the eights.” They are used to Howard Stern in any market at any hour. Most important, they are used to having over 100 channels available, even if they only want to use the most mainstream handful of them.
Even among my Edison colleagues, several of whom cheerfully evangelized for satellite for several years, there’s been some churn and a redistribution of listening that suggests what would happen on a larger scale. One co-worker has gone back to WPLJ, and is back to providing the same regular updates on their programming that she did four years ago. But another co-worker has filled the void with more podcast programming. And several now have iPhones and at least one co-worker is using his to listen to Classic Rock KGB San Diego, of interest to him in a way that local WAXQ (Q104.3) never was.
The ongoing success of the iPhone, even at this time of national austerity, is telling. It combines the two biggest challenges to local radio – the iPod for when you’re looking for your own music and multiple suites of multiple channels (local or national) for when you want somebody else to pick the tunes. And some of the same listeners who think $13 a month is too much for satellite are willing to pay close to $100 a month for their iPhone service- suggesting that if Sirius XM came with an app that let you read an MRI (or any of those other spiffy apps on their TV commercials), it might be perceived as a better value!
So if Sirius XM went away tomorrow, the owners of terrestrial radio would have to have a strategy ready to offer national radio to those listeners who are now wise in the ways of The Infinite Dial. Inroads were clearly made during 2008 by CBS, Clear Channel, the iPhone app clients of Jacobs Media, the clients of FlyCast and others. But there are still strides to be made in ease of use; in helping explain why you would want to listen to Jack/Vegas today, but Jack/Baltimore tomorrow and, most important, in making the national stations that have already been deployed into full-fledged choices. And services like Radio IO seem to have a head start in gearing up for this day.
If Sirius XM went away tomorrow it would not be an automatic boon for HD Radio. Again, there are too many other choices already deployed. The national stations that broadcasters are finally smart enough to offer via HD-2 multicast are barely better realized than the local stations that are mostly being assembled from parts found around the house. Then there’s that ease-of-use issue. If satellite listeners think hearing a station identified with separate Sirius and XM channel numbers are goofy, what would they make of “107.3 HD-2 in Washington, 95.5 HD-3 in Los Angeles, etc.”?
If Sirius and XM went away tomorrow, it would force terrestrial broadcast owners to think about finally serving the niches that don’t make sense on a market to market basis. That requires format innovation, which slowed to a crawl on Sept. 15. But some Sirius XM brands have national equity and smart broadcasters would find a way to either buy the intellectual property of or at least provide a successor to Coffee House or Faction (the most durable experiment in rap and rock together). For that matter, there’s still not a CHR in America like Sirius Hits 1 and I, for one, would want them represented somewhere on the Infinite Dial.
And, yes, broadcasters would have to find a way to get Howard Stern back on FM radio. Programmers have spent the last four years telling themselves that he wasn’t such a big deal anyway. No, not all of his audience (those that followed him to satellite or those that scattered to the winds on terrestrial radio) would be repatriated. And in a PPM world, Stern will no longer automatically translate to five daily hours of listening for his fans. No matter. Anybody programming a male-targeted radio station will tell you that those Stern listeners would bring some traffic back to the mall. And any Stern solution would have to include an angle for listeners who were used to hearing him at 6 p.m. or in a market where he hadn’t been on the radio before.
I’m not rooting for satellite radio to go away tomorrow. I appreciate many of its as-yet unduplicated offerings. And too many people are already out of work. But even if its stock issues, its Echostar relationship, and the auto sales slump are miraculously worked out tomorrow, the likelihood is that the delivery system for satellite radio’s programming will not be a satellite radio in five years. And regardless of who its current programmers are working for at that time, they will have had a head start on terrestrial broadcasters in programming for The Infinite Dial.
So what terrestrial broadcasters have to do if satellite radio goes away is the same thing they have to do if it remains a force. So it doesn’t include just waiting them out. Or hoping for somebody else’s problems to be bigger than yours.

30 replies
  1. lisa mckay
    lisa mckay says:

    This actually would be great news for terrestrial radio as advertisers have been throwing satellite radio in our faces as if it actually affected local radio listening. Also it makes a strong arguement that live , local and serving a commiunity is important and furthermore being a low cost jukebox serves nobody. My personal peeve with satellite radio is the low bit rate which creates listener fatigue quickly. I for one am celebrating!

    Reply
  2. LaMont Watts
    LaMont Watts says:

    Grat article Sean.
    One thing that wasn’t mentioned is the impact it would have on our stepchild of radio. HD. we could tranfer the satellite show over to HD? still no commericals and so many station have really bland programming on them.

    Reply
  3. Hal Abrams
    Hal Abrams says:

    Great Article Sean!!
    However, the reality is that Satellite probably won’t go away. Look for Echostar or some other group to feed on the chapter 11 remains. In fact, the bankruptcy may be more seamless than the merger (and don’t you know Echostar was waiting for the merger to complete before contemplating a stock takeover).
    Echostar (or whomever) probably will keep the Sirius/XM name (as they did with Dish Network) and skim the excessive costly talent. They may also focus their energies on delivering the Internet via satellite to compete with Clearwire technology…the real way radio will be delivered within a decade (did you see their stock today? CLWR).
    So even if Satellite went away, the Internet will be the way we retrieve our radio because of the choices, and as you say, the ability to hear Stern anytime, anywhere. Traditional AM-FM radio would still continue on it’s downward direction.

    Reply
  4. Jeff Scott
    Jeff Scott says:

    C’mon Sean, an informal poll of your tech-savvy, research-geek laden office staff is hardly a good measure of who will “return” to radio when, not if, satellite radio becomes irrelevant. No more so than any of us tech-challenged “old-fashioned” radio people could predict future usage of the radio spectrum. But it is clear that wireless broadband is the delivery method of the future and radio, like the telephone, will have to adapt.
    My 12 year old daughter–who knows and cares nothing about the radio business–has become bored with, and all but abandoned her iPod now that she has discovered the local CHR station. I hear it blaring every evening as she pretends to do her homework. This should sound familiar to generations…
    However, your valid point (whether or not you intended to make it) is that there is a sexiness to old technology when new technology is applied to it. The revered i-Phone and broadband devices like it have breathed new life into the hoary old “telephone.” God knows that’s hardly a new communications device.
    Radio will survive for the very reason that the telephone has survived…but it will take making radio “sexy” again (such as delivery to an iPhone) and the creation of quality content that allows the end user to manipulate it to their liking…something each generation tends to obsess over.
    When it comes down to it, as a Sirius subscriber I won’t really miss much about it except for Howard. It’s still old tech with only slight changes to programming choices. And, at least the channels with interesting and compelling content, such as Howard, could hardly be called commercial-free.
    Now if Howard decides to stream to iPhone…

    Reply
  5. Jeff Scott
    Jeff Scott says:

    As an adjunct and to further illustrate my old tech/new tech points above…if “texting” isn’t the modern day equivalent of the telegraph, I don’t know what is…everything old becomes new again.

    Reply
  6. Gordon Skene
    Gordon Skene says:

    People left terrestrial radio in droves because it became crap. Satellite radio jumped in claiming to be something different. But it turned out to be crap too.
    How can you expect anything to be different when you have the same people responsible for ruining radio to try and do anything new?
    Radio stopped being relevant when stations were going for obscene sums of money and gobbled up by conglomerates who had no business being in radio in the first place. It no longer became about the audience but became about the advertiser, about trying to pay off the crushing debt. Stations were run by people with no clue as to what an audience was all about. They abandoned their principles, their taste and their judgement. Radio has no identity, it has no stake in people lives as it once did.
    None of these proposed changes are going to save radio. What will save radio is a complete makeover, and unfortunately that will require its almost complete demise. Sadly, some things just require going back to ground zero in order to breathe life again.

    Reply
  7. Vivian
    Vivian says:

    If Satellite radio goes away, I’ll listen to the hum of silence before I EVER turn on the radio to a local station again, save for NPR, the only bastion of public radio waves. Local radio station is crap and has been since the big companies drove out the AAA radio stations or others who opted to play something different. Continue to dream on but I know I’m not alone when I say local radio has alienated me forever and ever.

    Reply
  8. Bill Campbell
    Bill Campbell says:

    Interesting we get so much “opinion” and casual
    “anecdotes” from a blog on a RESEARCH site.
    Surely Sean, you know, most Americans will not be affected by the loss of Sirius/XM.
    In today’s economy, FREE sounds pretty good.
    And ,free radio will sound better when we get
    rid of the greedy corporations who sought the easy money. Not only are the big operators lousy broadcasters, they proven themsleves to be lousy businessmen, too.

    Reply
  9. Marthe Reynolds
    Marthe Reynolds says:

    Hi, Sean, I just dropped back in the biz after being away for a year or so. Just finished working a LEFT-EYE record (yes, THAT Left-Eye) from the last album she made. And guess who played the single the most? SIRIUS XM…And Kanye’s manager heard it all over the holidays and his wife loved it…but not much love at the Earth-bound stations. Now I am not working ya’ll on the record…but without outlets like Sirius XM the gates get narrower and narrower. And that is scary. Peace & Love! Marthe R.

    Reply
  10. Mark
    Mark says:

    I’ll never go back to local radio, ever. If satellite goes away I still have a dozen podcasts — each genre specific — that I will continue to listen to just to avoid terrestrial radio.

    Reply
  11. Owen A Partyrock
    Owen A Partyrock says:

    One thing always missing in these commentaries is the existence of internet radio. It satisfies the listener who wants someone else to program for him yet lets him fine tune the selection to a very personal level.
    There are no commercials and with wireless air card, WiFi and, soon, WiMax being so ubiquitous it provides the portability f satellite w/out the issue of signal blockage indoors
    And enough about the Howard Stern! The whole argument for satellite is always “no commercials and you can hear howard say f***”. He is no longer relevant and focusing on him is one of the biggest reasons satellite is foundering

    Reply
  12. Rambling Johnny
    Rambling Johnny says:

    Kudos to you the King of all media himself just talk about that great article! I really think sat radio has a delivery system for content is probably doomed in the long term view. But the content packaging for music only channel the uncensored section for peoples who are sick of the constipated FCC all of this can be found on the net. In a few years I would not be surprised that big name like Howard would just move to the net and be their own boss! I mean it not like Howard is not on the net already in more way than some can think! Wink! Wink! Nudge! Nudge!

    Reply
  13. Armando
    Armando says:

    If SiriusXM goes away, I will still stay as far away as possible from terrestrial as possible.
    The only thing even remotely listenable is local sports talk in my opinion.
    No more SiriusXM? Hello Slacker.

    Reply
  14. Joe
    Joe says:

    Speek for yourself when you say no one would miss Sirius. I will miss it like hell. I don’t have cable and won’t pay for it and I spend my nights mainly listening to sports and music. Sirius is the best. Internet radio sucks, because you have to punch in stations I’d rather just have a tuner. Regular radio keeps putting more adds in ESPN radio is unlistenable and Clear Channel keeps firing good tallent, so what is the point of listening to it?

    Reply
  15. Anonymous Coward
    Anonymous Coward says:

    FM died. The top forty format is tired, the local commercials played 100 times a day are tedious, and the personalities sound like they all belonged to a frat. The number of subs to Sat Radio is not chump change. If Sat Radio goes away, they arent going backward. They will go forward into the broadband era of Internet radio and download on demand (iTunes) music services.
    Personally, I think if Sat Radio sheds the expensive radio personalities like Howard, they could create a very viable service based on their large music library, music diversity, commercial free — and retransmitting already existing content like sports and NPR shows. Sat Radio needs to get out of the business of creating its own (expensive) programming and just be great radio.

    Reply
  16. Keith Berman
    Keith Berman says:

    The national formats on HD aren’t IDing themselves with the litany of frequencies they’re using — formats like Pride Radio and eRockster are simply IDing with their name and a quick local TOH ID, just like every ID on Sirius XM doesn’t contain the channel numbers, just the channel name, with channel numbers given every few times.
    While I personally don’t hear much difference between the playlists on FM and satellite, one thing I would miss were satellite to go away is the fact that I can listen to a steady satellite signal anywhere, with the same channel lineup. When I roadtrip, I can always pick up the same channels and know what’s coming no matter where I drive, as can those in the car who know the lineup. After leaving their home markets, terrestrial listeners are at the mercy of whatever the local stations are and their signal limitations.
    That said, the technology on HD Radio is lacking, and I have had some problems picking up some HD signals just driving around L.A. Entravision announced it was putting the Indie 103 Internet stream on 103.1′s HD2 channel, which I would love to hear, but I can only get the HD signal maybe for a minute before it disappears — if I get it at all.

    Reply
  17. Sal Hepatica
    Sal Hepatica says:

    If Sirius/XM goes away, I will just listen to silence in morning drive. Morning terrestrial radio absolutely SUCKS! I want music, with maybe some news and weather. I couldn’t care less about which Hollywood bubblehead is sleeping with whom or who is coming out with a new CD or movie. Also, none of the terrestrial stations play the kind of music I want to hear! I like smooth jazz, pre-Beatles oldies, and adult standards. But terrestrial radio is obsessed with broadcasting to mall rats and thritysomething soccer moms, so we get CHR, with its throwaway “hits” and a glut of AC stations, with their nauseating diet of Elton John, Billy Joel, and Phil Collins.
    I did not get Sirius to hear that guttersnipe Howard Stern, as I am really not interested in hearing someone talking about penises all day. I can go to the local YMCA locker room for that!
    Sirius/XM should reorganiza and toss Karmazin out on his ass! He was one of the greedheads who helped ruin terrestrial radio and the inflated amounts that he paid for Stern and for sports programming are what put Sirius in the hole financially.

    Reply
  18. Mike McDowell/Blitz Magazine
    Mike McDowell/Blitz Magazine says:

    As a member (albeit peripherally) of that “people who were never going to be satisfied with mainstream terrestrial radio” club to which you refer, I would infer that the sad truth is that even satellite radio, for all of its early hype as a (yawn) “alternative”, simply offered little in the way of any real alternative that might regenerate any interest in radio in general within that group.
    Whereas one can certainly understand how there are legions who view radio as an overall entertainment experience (thereby justifying in their eyes that to which these ears is the still inconceivable practice of scoped air checks), taking into consideration presentation and personaity, there are those of us who still adhere to Berry Gordy’s maxim: “It’s what’s in the grooves that counts”.
    I hearken back to the heyday of the Drake format as a prime illustration. To be sure, in that era of sloppy FM backannouncing inbetween PSAs for the local “hash bash (man)”, one could definitely make a case for the generic yet frantic “Time! Temp! Calls!” mandate of the Drake affiliates as welcome relief for those whose allegiance remained firmly AM throughout those trying times.
    Yet for all of its bluster, the Drake clarion call could not be viewed as anything less than anti-climactic when such cheerleading abruptly segued into such somnabulist period pieces as Skylark’s “Wildflower” or Valdy’s still highly offensive “Rock And Roll Song”.
    In other words, for those of us who regard the music itself as an indispensible component of the equation, satellite radio has been no more of an argument than terrestrial radio has been against keeping a well maintained and well stocked CD player in the car.

    Reply
  19. Dan Updike
    Dan Updike says:

    As an ex-radio guy I would deathly miss Sirius if it went away. I’d miss the general craziness of a Mojo Nixon, or sports with Scott Ferrall, or the eloquence of a rock & roll legend like Andrew Loog Oldham on Little Steven’s channel.
    Terrestrial radio has been in a talent and content vacuum for many years. Now with the big groups laying-off another 7 to 10 percent of their workforce and the general “Seacresting” of America with bland, non-creative programming, radio will only get worse.
    Radio is a LOCAL medium at its best and needs its programming decisions made at the LOCAL level by responding to each communities needs. That’s the only way I can see that it will ever get its mojo back.

    Reply
  20. c.t.
    c.t. says:

    if satellite goes away, i still don’t see the terrestrial situation improving any. i’m in louisville, market #50. that ice storm that ran through here a few weeks ago was pretty devastating. many people tuned to the big 50000 watt station hoping to hear any news about services and traffic that they could.
    from 12-3, they got rush limbaugh with the normal updates at the top and bottom of the hour.
    this is also a station that sacked a local and live radio show for a syndicated tape delayed show. and it also pared down its news department to a shell of its former self. if satellite radio goes down, i don’t see any radio station enticing anyone to come back by building up its local flavor to what it should have been, or even by offering up the variety (music and talk) satellite offers.
    and good luck trying to find another mass outlet for any talk station that is not conservative or business based.

    Reply
  21. C.J.
    C.J. says:

    I would truly miss satellite if it went away! If for nothing else, I would miss listening to urban adult channels that play something other than 2 Luther Vandross songs, 2 Anita Baker songs, 2 Stevie Wonder songs and a couple of currents 500,000 times a day. Not mention they’ll be playing those currents for the next 2 years.
    If terrestrial radio is ever going to get these listeners back they are going to have to go back go creative programming and wider playlist. As someone is is in the 25-54 demo, I grew up in the ’80′s and the ’90′s and I feel there is no terrestrial station out there for me. At least satellite acknowledges my existence and provides channels like ’90′s on 9, Backspin (old school rap) and others.
    Good terrestrial on trying to get me back. You’ve got your work cut out for you!

    Reply
  22. Paul Anderson
    Paul Anderson says:

    If Sirius/XM goes away, I’ll be listening to the same amount of terrestrial radio as I do now: local news and baseball on AM, nothing on FM.
    There is nothing on the FM band that holds any interest for me. There is nothing that plays the variety of genres and number of songs that satellite radio plays.
    Internet radio is fine, if you are near a computer, but I still don’t understand how that helps me in my car, which is where I do almost 100% of my radio listening. I can’t even get reliable cell phone coverage everywhere I drive, so how will someone get a reliable Internet connection to my car? And I don’t want to listen to some teenager’s “radio station” broadcast from their bedroom! I want a professionally-run station or channel that provides a good mix and selection of music.
    I sure hope satellite radio can continue to exist, because terrestrial radio isn’t getting my business back.
    Paul

    Reply
  23. Cynthia Morgan
    Cynthia Morgan says:

    Sean, I agree with you. We in the radio industry should focus on improving our product instead of bashing a competitor. As for those who suggest that we run pr or ads belittling Sirius XM – Why??? If we keep talking about satellite radio with our customers they may soon think it is important enough to try. After all, if we are so obsessed with it perhaps it is worthy of their attention too.
    Cynthia Morgan

    Reply
  24. Raymond Coniff
    Raymond Coniff says:

    I stopped listening to TerrRadio in the 90s. Smooth jazz formats disappeared. Oldies formats rotate the same Beatles, Stones and Supremes songs. Talk radio became a blame game or filth fest. As a daily listener to SatRadio for years, there is no way I am going back to TerrRadio. But, I believe DISH will obtain XMirius, sell off one or the other brands, and use SatRadio in marketing packages to customers—DISHRadio sort of thing. I think we will hear some promotional stuff and some commercials on a DISH-ized SatRadio. “Here’s what you can see on DISH TV tonight.”

    Reply
  25. Mike
    Mike says:

    I’ve been in radio for over 20 years, and even I can’t stand to listen to it anymore. I listen to it, as much as I have to, which is just the amount of time I’m in the studio. 25 hours a week or so, and thats it. out of the 6 full time announcers on staff, 4 are Sat. sunscribers, and all admit that there is no way to go back to AM/FM if the company folds. Sure Satellite has it’s repeats, and on some channels chatty jocks and even commercials, but I just pick up the remote and tune to something else. To me Sat. radio still has that “oh wow” factor, when you hear a song that you haven’t heard in years if ever. When was the last time you tuned into your local station on the dial, and were surprised at the content? If Siruis?Xm goes, hopefully there will be something to take its place because for me there is no going back to local radio. I’ve been enjoying steak, you can keep your liverwurst

    Reply
  26. Johnny Marchese
    Johnny Marchese says:

    Well, it looks like Liberty beat out Echostar for Sirius/XM, so now DirecTV does not have to lose their music channels. Also, keeping it helps in the NFL Sunday Ticket deal so the NFL radio highlights package can stay as well. Dish, if they could have aquired it was going to try to take “Sunday Ticket” away. Liberty saved their butts on this one. Now can they save Sirius/XM? I don’t know. DirecTV has their own problems, especially in my neck of the woods, not having the channel that covers our sports teams, so we do not get to see what I thought localism was supposed to force. As you can see, I really don’t care what happens to sat radio,or DirecTV. When is AT&T U-Verse coming to Livingston Parish, LA, especially the city limits of Denham Springs?

    Reply
  27. Herb
    Herb says:

    I believe in Satellite Radio. It’s the best!!! It is making money but simply has too much debt. I believe it will survive. Terrestrial radio dragged it’s feet on going HD and will never catchup. With the ownership consolidation of radio, it’s all about profit, NOT good radio. I pay for 4 subscriptions to Sirius. It’s worth every penny! 20 Million of us recognize the value in Satellite Radio. There are too many people with bucks that are simply too cheap to spend a few bucks for something that they think they can get for free over regular radio. Thank-you Mel! Herb/SFL

    Reply
  28. roshon vance
    roshon vance says:

    Great article Sean. I listen to Sirus/XM all the time & I really love it. I don’t like some of the changes since they merged however. I miss WLW in Cinn., Also Soul Street has been replaced by Soul Town on Channel 60. When Bobby Bennett programmed it he seeemed to have the pulse on the format. He made it compelling to listen to…..now “Soul Town” sounds like a juke box.

    Reply

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