Eight years ago, I wrote an article for this blog titled “SiriusXM Radio is Now Free.” At the time I was speculating on what might happen to over-the-air commercial radio if the satellite company were to turn on their ad-supported channels in every vehicle equipped with a SiriusXM radio.
Well, it looks like that is finally coming to pass.
SiriusXM’s Growth Has Stalled
Fred Jacob’s wrote in his blog on Friday that…
SiriusXM, increasingly frustrated by their inability to grow their subscriber base. Looking at the Netflix model, the satcaster earlier this week unveiled their own ad-supported tier for no fee.
Obviously, this is a radical departure from SXM’s legacy subscriber-driven platform. Radio Ink reported that no matter how you look at the in-car battlefield, satellite lags far behind traditional radio listening. SiriusXM, however, performs much better in luxury brand, such as Mercedes-Benz and Audio, as well as in newer vehicles.
Inside Radio says there are other hoops for drivers to jump through. While SXM CEO Jennifer Witz says the new plan is all about “repositioning our business for the future,” the story goes onto say the free service is only available to owners of vehicles with the company’s 360L receivers. Additionally, eligibility is limited to those whose free trials runs out and can only be activated by one vehicle per customer.
But it’s a start. While the company acknowledges it will take time to amp up the platform’s commercial options for advertisers, you can see that’s where they’re headed. SiriusXM needs to jumpstart its user base, while cashing in on inventory sales.
Will it work? Can a radical move to offer a “free” version of satellite radio actually be a game-changer for SXM.
We can all speculate about the wisdom of this risky move by SiriusXM, but like the growth of [other ad-upported] channels, it attempts to cash in on the notion of not paying cash for any media content.
Pay & Free
It doesn’t take a whole lot of imagination to understand why satellite radio is deciding to have the best of both worlds. Offer the premium pay channels to those willing to pay for them and at the same time create a free tier of channels that could be ad supported by national advertisers.
What history shows us are things that happen in other industries and services – eventually making their way around to virtually all of them.
NOW – It’s only a matter of time.
Link to my 2016 blog article: https://dicktaylorblog.com/2016/07/17/siriusxm-radio-is-now-free/
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