Sirius XM’s FCC Price Freeze Expires
In a move that Sirius XM was confident would happen, the FCC has made the decision not to extend the price freeze that had been in place over the last three years. This paves the way for Sirius XM to now have total control over their pricing from the standpoint of the government. There are still pending issues (such as the Blessing case and the Shenk lawsuit) that take the company’s pricing into question, but at this point the company is free to price their service at any level they feel makes business sense.
Sirius XM has not raised the base price of their service in many years. Other aspects such as an increase in family plan pricing, Internet feed pricing, and the implementation of a royalty fee pass-through have made enjoying satellite radio more expensive however.
At this point Sirius XM has stated, as part of the Blessing proposed settlement, that they will freeze prices until the end of 2011. That proposed settlement has come under fire with various objections that could throw wrinkles into when the company contemplates a price hike.
With Satellite Radio 2.0 set to launch this fall, it will be interesting to see what Sirius XM does with their pricing structure. If the company wanted to risk getting technical, they could potentially raise the rates on new subscribers which are not members of the class, but that endeavor is likely not worth the potential backlash. In Q1 the company added only 120,000 self paying subscribers. Getting a few extra bucks from a number this small may simply not be in the cards or worth the effort.
Position – Long Sirius XM Satellite Radio
Great news! They now have the opportunity to not only raise prices on their current plan offerings but ALSO get creatvie with some additional packages that may appeal to more people.
Something that was discussed alot from the FCC during the merger hearings was this ‘ala carte’ packaging. I’m not saying SIRI should do this, but would be interesting if they can make a business case for doing a ‘Music Only’ package were consumers could pick out say 10 or so channels and pay a $5.99 monthly fee.
I realize this could potentially canablize some existing subs that pay $12.99 but if research shows it will bring in ALOT of new subs, it could offset the canabilization and bring in some substantial incremental revenue. Just a thought that I hope Mel and co. are evaluating.
I follow SIRI closely but certainly don’t have time to read EVERY article that comes out. Have alternative subscriptions pricing models such as this been discussed?
They already have a-la carte radios and a-la-carte packages.
Sirius Premier (Best of package) – $16.99
Sirius Select (standard package) – $12.95
Sirius XM Internet radio – $12.95
Sirius XM Internet Radio add-on – $2.99
Sirius News Sports and Talk – $9.99
Sirius Mostly Music – $9.99
Sirius XM all in one (both sirius and xm) – $19.99
Sirius a-la-carte gold – $14.99
http://www.siriusxm.com/subscr.....acartegold
Spencer, BullMarket75,
From the SiriusXM website, they also have “A La Carte Starting at $6.99 /month*†
Pick your top 50 favorites from all eligible channels within the Sirius Select package. Choose from a selection of programming including commercial-free music, plus sports talk, news and entertainment. In addition to the 50 channels* you choose, you’ll also get several news and special interest channels — including BBC World Service, NPR Talk and The Catholic Channel — at no extra cost.
Requires an A La Carte-capable Sirius radio – Sirius Starmate 5, Sirius Stratus 6
Does not include live games or races
Premium channels cost extra
This package does not include online listening with SiriusXM Internet Radio
† Each premium channel is an additional 25¢ / month, up to a maximum monthly package price of $12.95. Add Howard and/or Sports bundles for an additional fee.”
BTW, the link is http://www.siriusxm.com/subscr.....rtechoices
Also, they certainly will have to do a price increase to coincide with all the new benefits and features of 2.0 . Even though they haven’t had a price increase in over 5 years or so, I don’t think they could get away with it without adding value for customers.
Hopefully all the new features of 2.0 will justify a price increase. Certainly Mel is closely watching the reaction of customers to the Neftlix price increase. Consumers are fickle when it comes to pricing for ‘nice to have but not necessary’ items like SIRI. Even wealthy folks are not spending as much during scary economic times like these. I’d hate to see a price increase backfire and only hope they are planning something big around 2.0, including a strong media and marketing push!
Wow, great find! I didn’t see it on google news search of SIRI. Great work in uncovering this. Just sucks they wont be able to raise prices till Jan.
July 28 has been the date for quite some time. It is simply a matter of checking the FCC website to see the latest news on Sirius XM.
thats cool. I read it from you first so, thanks!
i joined sirius in 2004,before the merger sirius was competing with xm, i chose sirius because the boombox channel and the beat, before the merger sirius and xm had a total of 10 dance channels,when they merged they cancelled about 35 of our channels including my favorit channels, now ther are only 2 dance channels.the FCC let the 2 companies form a monoply, since ther are no other satelite to compete with, they will keep cancilling are channels and now raise are rates, i now listen to internet radio ( slacker,pandora, iheartradio, ) now i can listen to all kinds of music i want to hear for free.some day i hope one of them launch a satelite to compete with sxm, then maybe they will bring are channels back.
Side track: Hey Spencer. I’m totally convinced you are on the mark with your forecasts. That Brandon Matthews is like a flip flopping John Kerry. And if you disagree with him, oh how he cannot take it. Then I see him going to Seeking Alpha and criticizing you for stealing his work. What a sour puss. Bottom line, I “thought” you were too conservative. Turns out you were right in your Q1 numbers and will probably be right come Q2. BM now bite off you by making a Bull & Bear case on 1 of his articles. Wow. Didn’t you come out with that like 5 days or a week ago.
Just had to let you know, your work is appreciated man!