Should Sirius XM Stream Concerts By Partnering With Liberty’s Live Nation?
Ever since Liberty Media took a stake in Sirius XM Radio (NASDAQ:SIRI), people have been looking for “synergies” between some of the Liberty Media (LCAPA) holdings and the satellite radio provider. While such synergies may seem natural, there are many moving parts to these types of deals, and they are not always as easy as some would like to make them out to be. One such “synergy” I have seen discussed, and even received emails about is the concept of Sirius XM streaming live concerts with Live Nation.
The first thing that investors should understand is that Sirius XM already streams a lot of live concerts. This concept is not necessarily new. Partnering with Live nation may seem natural, but that company has a responsibility to their shareholders as well. Selling concert tickets has had its challenges for a couple of years now. If concerts were made available on radio, it could become harder to sell out the live show. Long time NFL fans may remember days when you could not watch your team on television unless the game was a sellout. For Live nation their core business is selling out events at venues for as much money as possible. The agenda of Live nation simply may not include a side deal with Sirius XM, or perhaps Sirius XM’s audience is not yet substantial enough for Live Nation.
This week Songkick, a concert streaming service announced that 100,000 people have downloaded their iTunes app in just 14 days. What business is Songkick in? The streaming of concerts business. They have a business model that focuses all of their energy to delivering concert information to consumers and even putting that consumer in touch with ticket vendors that are selling tickets. While streaming of the concert is not yet an option, when that day comes one can imagine that Songkick will be there to offer it, will already have a substantial fan base, and already have deals with many more ticket agents (They already work with over 60 companies) than Live Nation.
The point here is that live concerts on Sirius XM may be what they always have been. A smattering of offerings from specific artists or festivals that the company participates in. While Satellite Radio 2.0 does promise On-demand, getting to the point of streaming concerts will likely take some time, and in the end may not offer enough of a financial reward for the company to make it a part of the business. While such deals may seem appealing, we always have to consider the business dynamics, and grasp that they simply may not be viable.
In my mind the odds of a Live Nation partnership to stream concerts in any meaningful way simply will not happen any time soon. You may be the biggest Linkin Park Fan out there, but how many of the 20 million subscribers would actually pay $10 to stream the concert live? How many On-Demand requests would there realistically be? How much of that $10 would Live Nations want? How much would Linkin Park want?
The bottom line is that the imagined synergies of passionate satellite radio investors are often just that. Imagined. As an investor, the only way I would want to see Sirius XM do such a deal would be if it would deliver meaningful and material dollars to the bottom line. I have heard of people feeling that Sirius XM will go international on the heels of Direct TV or even Dish Network. Again, does this business make sense? Will Sirius XM’s programming appeal to Japan or Argentina? Moving into new markets requires content that appeals to those markets, licensing in those markets, and most of all, a big enough potential to be viable there as a stand-alone venture. Sirius XM took on Canadian partners to launch north of the border, and still to this day (years later) this venture is not really adding to the bottom line. The “synergy” seems easy and natural, but the business simply may not be viable.
Should Sirius XM partner with Liberty’s Live Nation? Only if it makes business sense, and not a second before.
Position – Long Sirius XM, No Position Live Nation.
I agree with one step at a time approach. One of the oportunities could be streaming concerts from countries other than this one since live nation is in the world wide business. In this way you would avoid any conflicts. I doubt that at the moment anyone can come close to the amount and in particular quality of the original material you can hear on sirius xm. This is one of the major appeals of the service.
Excellent post on bullitin board at SA telling it like it is.
It applies here as well. These guys have their own agenda and will post whatever BS to suit their own greed. Osborne is one of the wolfpack too. But that’s just my opinion.
“Cameron… So disagree with your article. Metrics? Value? Honestly, you’re going to tell me that the recent price depreciation to $1.86 had to do with price valuation or anything other than price manipulation? WAKE UP! 317 million short shares. An SEC who do NOT enforce the laws of trading they created. Integrity? 99% of ALL you writers and analysts GET YOUR PREDICTIONS WRONG! This is a statistical fact. Only a retail investor would read your articles and do what you recommend. Bottom line: When Satellite Radio 2.0 comes out it will be a game changer. You may have your doubts. You may have an agenda. Writers like YA LITTLE from The Street and your own Rick Dude [Doh, sure, that’s his real name] all are full of it. You all are trying to make a buck like the rest of us. Except you guys should be arrested for some of your articles. Reading Seeking Alpo, The Street, Motley Drool, Wall Street Cheat Sheet, etc etc etc articles requires an understanding how to read between the lines. There is NO HONESTY by any of you because you all trade and have your own personal interests and from what I read day in and day out, your all just as petrified to lose a buck as the rest of us [retail most of all]. So no problem in trying to use fear to move the stock price or to simply mislead readers by using old and outdated facts to support your b.s. stories. I read you to learn what is coming. But more often than not, I need to use reverse psychology to uncover the TRUTH. I wait for a champion to emerge who will write an honest story that actually HELPS PEOPLE. So far, no luck.”
geronimo….
You seem to have an axe to grind but fall way short on your facts. Last week you leveled accusations against me, and this week you are doing the same.
1. I do not trade the stock. I make it a personal policy not to do so. If you have been following me for any length of time you would know this.
2. I do not write to influence the stock. I present news and opinion. It is that simple
Last week you stated, “Just watch. As soon as siri bottoms and starts north watch all the positive hyping articles Osbourne will start printing. Look back at his articles in relationship to siri share price. As soon as we hit $2.44 all of a sudden articles turned negative, this POS, PREDICTED SLOW DOWN IN AUTO sales, slow down in subscribers, increased churn rate, higher competition,Pandora IPO, poor management, lack of innovation, marketing. Go back and look. Just an observation.”
1. Siri headed North already, yet do you see me pumping away? No, you do not.
Look at the archives, look at what I wrote when, and look at the stock price. I challenge you to get off your but and correlate the two. Since I know you are incapable I will do it for you…The stock began its run on May 24th. Here are my articles that week:
May 24 – Sirius Annual Meeting tomorrow – SiriusBuzz Will Be There
May 24th – Sirius XM adds benefit for Hyundai CPO buyers
May 24th- Moody’s Upgrades Sirius XM
May 25th – Shareholders Approve all measures at annual meeting
May 25th – Samsung to incorporate Sirius XM into Televisions
The list goes on and on. http://siriusbuzz.com/archives
The fact is that you simply do not comprehend what I write. That is your issue, not mine. Do some homework for once and you will see that you are way way off base
Spencer…. on a different subject altogether, there has been a lot of speculation that SIRI’s precipitious drop in share price on Friday [$2.09 HOD to $1.95 AH LOD] was due to Russell rebalancing? Can you confirm? And if this DID take place, why didn’t you or any other writer or analyst make mention of this to give traders warning of what was coming?
can you say, “CLUELSS!” He is “The Great Pretender”.
That could be part of the explanation. The stock popped on takeover rumors from Dish’s Joe Clayton. This brought it higher than it should have….thus, the dip looks much more substantial than it otherwise would have.
Most analysts felt that the rebalance would not see a lot if shuffling, thus impact was not expected to be substantial.
Geronimo….
Can you spell clueless? You are simply a person obsessed with me. You have yet to make any valid points.
Sirius should be more concerned about there online streaming application not working properly since they changed all the station channels.