The Copyright Modernization Act (HR 6052), which seeked to change the rules on the licensing and delivery of digital music, has died. XM Satellite Radio ran a grassroots campaign earlier this week, in a mass email sent to all subscribers, urging readers to oppose this legislation.

In the email, XM claimed that HR 6052 would "drive up our costs and stop us from offering radios that allow you to record XM channels for your later listening - in the same way that TiVo allows you to record TV for later viewing."

Well, it's dead. When the bill's sponsor, Senator Lamar Smith, said he'd like to delay HR 6052 until next year, "a collective sigh of relief was let out from a few rows of audience, comprised of consumer device manufacturers and some service providers," according to Public Knowledge.

[Public Knowledge via About The Image] 

NAB President and CEO David Rehr wrote a letter (PDF via SSG) to Sirius and XM, that coincided with his opening speech at yesterday's NAB Radio Show, where he called on the satellite radio industry to "voluntarily withdraw and replace all noncompliant satellite radio devices in circulation."

"...now that the FCC has approved the resumed manufacture of newly compliant satellite radio receivers, NAB urges XM and Sirius to take the next logical step of voluntarily withdrawing and replacing all noncompliant receivers already in circulation, to resolve existing interference to terrestrial radio service," Rehr wrote in his letter.

In his speech, he didn't just "urge" XM and Sirius to recall all non-compliant satellite radios, but he also went on to say that the interfering FM modulators are making satellite radio "both a subscription and a free service," and that satellite radio as a result "cannot have it both ways" when it comes to being beyond FCC indecency regulations.

Oh but David Rehr didn't stop there. He goes on to claim that the NAB isn't afraid of the competition because "satellite radio says it has at most 10 million subscribers, notwithstanding those 500,000 subscribers in empty car lots. But 260 million people listened to broadcast radio last week alone!"

You can read the full speech here. Feel free to email David Rehr, at drehr@nab.org and let him know what you think.

NPD Group's August sales data (available on SSG) have showed the first decline in the satellite radio retail channel, when compaired to the same period last year. Unit sales for the industry as a whole fell 3% year-over-year in August, while in July satellite radio retail sales actually increased by 2% YoY in July.

The Quick Glance:
Sirius August 2006 Retail Share: 55%
XM August 2006 Retail Share: 45%

Sirius' unit sales were up 16% YoY in August, while XM's unit sales were down 19%. Compare this with July, where Sirius' YoY unit growth was up an incredible 49%, and XM's YoY unit sales were down a whopping 29%.

The Analysis:
Sirius Satellite Radio's retail share has been 54% or better for every month since September 2005. That my friends is The Stern Effect in action. Unfortunately this also sets the bar very high for the coming months, and with the amount of retail activity we saw in Q405 it'll be hard to show a year-over-year increase this year. Sirius' share was 55% in August, in line with September 2005 (55%). XM's share on the otherhand was 45% in August, compared with 54% in September 2005. For the past 12 months, Sirius has dominated the satellite radio retail market share.

Going forward, I just don't see Q4's retail sales showing any sort of YoY growth from 2005. 2005 could almost be discounted as an anomoly (almost) because the subscriber growth was just not indicative to a "natural" curve. Stern changed everything last year and the hype he generated will be extremely difficult to duplicate this year. I'm not being a Negative-Nancy, just trying to set some realistic expectations for the months to come.

Does this support the theory that satellite radio retail sales have reached their peak? I'm not so sure, but the months ahead will be difficult.

A recent report by Bank of America analyst Jonathan Jacoby states their belief that the satellite radio industry's annual retail gross adds could be nearing its peak.

Citing that the "early adoption phase appears to have passed," BofA now estimates that gross subscriber additions from the retail channel will flatten out from 2006 to 2007. What's worse, they project retail adds to begin to decline after that point.

What this does is put a greater dependency for subscriber additions on the OEM channel. Greater reliance on auto manufacturers puts both XM and SIRIUS in a weaker position when distribution agreements are up for renewal.

But while the early adoption phase may be ending - for today's receivers - I wonder if innovation in technology can combat this looming peak? The wearable receivers are evolving, and with a total of nearly 59 million iPod sold, there's obviously a market for personal music - and the possibility for satellite radio to engage even a fraction of this audience.

Then there's the home. With innovations like SiriusConnect Home and the XM Mini-Tuner, satellite radio has the potential of being embedded now into many home entertainment systems. This type of convergence that integrates satellite into home electronics exposes the technology to a whole new market. I think there's a massive potential to this market. The key? Give away free trial subscriptions with the purchase of these satellite-ready devices.

So let's open the floor to some discussion. What areas of potential growth in retail do feel are untapped? What devices do you believe will help spur a surge in retail?

A spin-filled article on Radio World Online by Guy Wire (ugh) entitled Satellite in Trouble as HD Grows left me scratching my head by the end of the piece. It starts out by painting Sirius and XM as a fool's investment, stating that both are seeing "subscriber growth rates slow and begin to level off." Level off? I don't know about that.

He then goes on to build a doomsday scenario of how both companies are hemoraging money, facing regulatory troubles, and lumps satellite radio in with "any other high-tech venture that over-promises and under-delivers." Yet, all his points stem from events spanning the past 9 months. Nine months there "Guy."

At this point I'm waiting for the HD Radio speech. So far it's just been a satellite bash-fest... where's the meat? He instead goes on to talk about how terrestrial radio is the most logical savior of satellite should the auto manufacturers decide to cut their losses. In fact, terrestrial having controlling ownership would be the best thing for satellite! So the article now has turned from a satellite bash-fest, to a terrestrial love-in. Riveting.

But where's the point about HD? Oh wait, here it is at the end. Instead of filing HD Radio away with FM Quad and AM Stereo, which many are doing, he instead compares HD Radio to FM. FM started in 1961 yet needed 10 years to take hold, and another 10 years before becoming the "dominant choice for consumers," which he pridicts will be "the same pattern is likely to be charted by HD Radio."

So... in 20 years HD Radio will become popular? Hallelujah! Yet, the occurances of the past 9 months spell complete failure for satellite radio? Amazing insight! Do yourself a favor, keep your smoke blowing propaganda to internal emails there "Guy" - your rant just fell apart.

[Radio World Online]

Acura is making XM Satellite Radio available as standard equipment in their entire 2007 model line.

Acura will also now offer XM NavTraffic as part of the AcuraLink system which will be expanded to four of its top-selling models: the 2007 Acura RL and TL luxury performance sedans as well as the all-new MDX and RDX luxury SUVs. Acura was the first automotive brand to offer XM NavTraffic when it was introduced in the 2005 Acura RL.

"Our partnership with XM Satellite Radio means that every Acura offers buyers a class-leading array of sophisticated satellite-delivered technologies - all designed to work together seamlessly while keeping passengers informed, entertained and in touch" said John Mendel, Senior VP of automobile operations for Acura.

With all 2007 Acuras, a three-month complimentary subscription to XM Satellite Radio will be included. Three months of XM NavTraffic is also included with properly equipped vehicles.

With Howard Stern's move from terrestrial to satellite radio, and his show gone from E! to OnDemand, visits to Stern's website and search queries are down - at least according to Hitwise (via Media Buyer Planner). This sparked my curiousity, because some people are using this data to say that his move to satellite hurt his celebrity.

So first, let's work backwards and take a look at search queries data. First, the Hitwise numbers:

Now, let's contrast these numbers with what Google Trends shows us:

Strange, the trend lines don't seem to match up... even if you just look at the same date ranges (Hitwise starts from March 2005 - right around the "D" mark on Google Trends).

OK, so let's look at overall website traffic:
 

Now, aside from the "siriusradio.com" thing - which redirects to sirius.com anyway - I wanted to see how this matches up with Alexa traffic results:

(Note that I'm only able to overlay sirius.com and howardstern.com on the Alexa chart.) These tend to be tracking with each other, as opposed to opposite each other as the Hitwise numbers seem to be.

Now wait, didn't comScore do something like this earlier this year? Oh yeah, that's right, they did. Let's take a look at their numbers as well:

Interesting.

Now... really all this proves is that each service's varying methodology has the ability to create different results. Interesting to say the least, but not nearly the law-of-the-land.

So that leads me back to the question of using this to measure the amount of celebrity. Does the decline in traffic and search queries (according to Hitwise) indicate a reduction in the 'celebrity' of Howard Stern?

Well... yes actually. He's talking to a lot less people now, so what? The thing I really don't like about both posts is that they are indicating that being on satellite radio is a step down in "status." But this form of media is still very much in it's infancy, yet the rate of adoption is faster than cell phones, cable and the Internet. Sure, right now the audience is relatively small... but what about in 2010?

Out of the final four agencies that XM was considering - The Richards Group, Wieden + Kennedy, DDB in New York, and Lowe - XM Satellite Radio has selected Lowe for its estimated $50 million ad account.

Lowe will take over the creative duties from Mullen which will continue to handle buying and planning activities. Interestingly, Lowe and Mullen are both owned by the same holding company, Interpublic Group.

I can't wait to see the direction that Lowe takes XM's creative, as Mullen's were... lackluster in my opinion, to say the least.

[AdWeek]

The Anchorage Daily News has a wonderful writeup on receiving satellite radio in Alaska. Remember when I was asking for subscribers in Alaska? That was in an effort to help with this article, which Sarah Henning didn't need my help with because it's a great piece (and none of the respondants that I sent over made it in).

Officially, neither SIRIUS or XM provide service to Alaska, but both companies acknowledge that they have Alaskan customers. Most are in the southeast portion of the state for obvious reasons, while other - such as those in Anchorage - find themselves with a very inconsistent signal.

It's an artifully written article and definitely recommended for your morning read.