Woohoo! Here's video of the satellite radio mention on the Simpsons.

Thanks to the boys over at Sirius Uplink for the video!

You know a medium has reached key milestone in our mainstream culture, when it gets mentioned on the Simpsons.

So was the case when during last night's Simpsons episode ("Revenge is a Dish Best Served Three Times") when Homer showed off his new satellite radio. Sure, it's not going to make anyone run out of their house to the nearest Best Buy, but it pretty damn cool.

Gee, that looks strikingly similar to a Sportster. SSG has a pretty good thought as to why.

[SSG via Sirius Uplink]
Thanks Joshua!

(Side note: I've been trying to find the video for this all day... anyone have a clip of it, please email me and I'll post it.)

Bridge Ratings has released a new study projecting the user growth of various digital media including Satellite Radio, Internet radio, mobile phone streaming, and HD Radio (amongst others).

Let's first focus on the satellite radio subscriber projections, because well, that's what I do. So for the end of 2007, Bridge Ratings is projecting an increase of 3.9 million net subscribers for the satellite radio industry as a whole - with XM at 9.12 million, and Sirius at 8.34 million subscribers.

Just for comparison's sake: Bear Stearns' Robert Peck predicts XM to end 2007 with 9.2-9.3 million subscribers, and Sirius to end the year with 8.1-8.2 million. Bank of America's Jonathan Jacoby weighs in with his 2007 prediction of 9.2 million subscribers for XM and 8.2 million subscribers for Sirius.

Whatever the source, it's obvious that there's a lowered expectation for the total number of potential satellite radio subscribers in the US. Something that industry-watchers (myself included) continue to scratch their head over.

And that's only 2007.

For year-end 2008, Bridge is predicting 10.76 net subscribers for XM and 9.99 subscribers for Sirius. By 2010, Bridge is saying that XM will have 12.48M subs and Sirius will have 11.99M subs. By 2015 we're at 15.60M for XM, and 14.39M for Sirius. And yes, the projection even goes as far as 2020 where Bridge estimates 17.94M subs for XM and 17.26M subs for Sirius.

Since the predictability of anything past 5 years essentially deteriorates over time, let's just look at the 2015 and 2020 projections as "interesting" but non-conclusive. Technology changes at such a rapid pace, that it's just not reasonable to look at anything past 5 years (case in point: 5 years ago XM had 27k subscribers).

Looking at the other 2010 numbers, there's some interesting figures that I'm sure XM and Sirius are looking closely at (or they should be). Particularly that's Wireless Internet (WiMAX?) and Mobile Phone Streaming. These could lead to a new definition of "subscribers" as XM and Sirius look to diversify their offering.

By the beginning of 2010, Bridge is estimating 93.26 million Wireless Internet users. That doesn't necessarily mean that there will be over 93M people listening over Wireless Internet (so from a superficial standpoint you could consider it as a "no threat" figure) but it shows a trend of what consumers will be expecting. And guess what: mindshare is everything. While I can't attest to the numbers of Wireless Internet users, it doesn't seem like a bad idea for satellite radio to position themselves more than just "radio" but as an overall method of "connectivity" - particularly in the car. Delivering real-time services that prove useful for the consumer on-the-go is a big step towards making satellite radio a "necessity" rather than a "luxury." Real-time traffic, weather, stocks, sports (...what's next?) are all things that can be delivered to the consumer as pure data - making terrestrial radio (essentially the "middle man") an obsolete service no longer needed by the mobile user.

As for Mobile Phone Streaming, Bridge is predicting 40.17 million users by 2010. (Side note: the term "mobile phone streaming" and "wireless internet" could very well be the same thing in a couple years - but I've split hairs enough for this post.) More than anything Mobile Phone Streaming looks to be an opportunity for the satellite radio industry. It's in the unique position to be a centralized content provider - not just of live programming - but of "effortless" music content (not to mention those data services). Sure deals like Sprint and Cingular don't give much to the bottomline right now, but strategically they're the foot in the door for when the consumer begins to actually look at their phone as a music device. And that change in consumer mindset looks to be right over the horizon.

So while we're looking at the possibility of a slower overall adoption of satellite radio in the next few years (something I'm not 100% convinced of), a lot can change in the next few years, and the definition of what a "subscriber" really is... could change as well.

[More at Bridge Ratings] 

If a merger between XM and Sirius were to happen it would probably happen within the next 4-8 weeks, says Bear Stearns analyst Robert Peck.

The reasoning behind that is that he believes that the deal would need to be wrapped up and approved by the Summer of 2008, before election seasons starts heating up. Since the deal would likely take 12 to 15 months complete, and they have until mid-2008 as a deadline, so that's where we can backtrack to see the rapidly closing window of opportunity.

Peck also mentioned that Sirius and XM will likely review whether or not the deal would pass regulatory approval (something we've all been speculating on as well) and if the likelihood is more than 50%, they could very well make an attempt at the merger.

[via Inside Radio]
(Note: Inside Radio shows 4-6 weeks though Peck actually said 4-8 weeks.)

The merger of XM Satellite Radio and Sirius Satellite Radio could create the net present value of $6.7 Billion in savings and synergies, according to Bear Stearns analyst Robert Peck.

That figure is taking into account "several simplifying and sometimes conservative assumptions" including no revenue from additional services and the fact that both companies would likely have to operate both satellite systems in the near term to prevent a disruption in service.

Peck believes that the largest contributor of cost savings would come from OEM and programming, while - unlike the NY Post's assumption - content costs would not be reduced upon renewal "as DARS will still compete with other delivery technologies."

XM Satellite Radio and Honda have launched a satellite radio trial program for Honda Certified Used Cars with factory-installed XM Satellite Radio.

All certified pre-owned Honda models (equipped with XM Satellite Radio of course) will be available with three months of complimentary XM service and a waived activation fee. Honda models equipped with XM include the Accord, Accord Hybrid, Civic, Civic Hybrid, CR-V, Element, Odyssey, Pilot, and Ridgeline.

This is obviously the evolution of a similar program that XM and Honda Motors launched with Certified Pre-Owned Acuras back in October.

Combined with the Acura program, this will make XM available in over 35,000 pre-owned vehicles in 2007, and is expected to grow to more than 55,000 vehicles in 2008. As the increased availability of factory-installed XM Satellite Radio across both Honda and Acura grow, so will the availability for this used car satellite radio program.

"I think the Street might be making too much of the weak satellite radio sales at retail. The satellite services will live or die on their ability to become standard equipment on most new cars; after-market radios is always going to be secondary."

"People often say numbers don't lie. That's not true, numbers lie all the time."

There's an interesting article in today's New York Post about the possibility of XM and Sirius no longer be signing, or renewing, the high-cost programming deals as they did in the prior years.

Deals like the NFL, Howard Stern and Martha Stewart on Sirius' end; with the MLB, and Oprah Winfrey on XM's end; were cited as being some examples of the lucrative deals signed. And of course the New York Post hints that these "rich paydays will expire when the contracts do."

But the fact of the matter is that the very earliest any of these contracts will expire is in 2009. If this article was written one-year ago, the headline most likely would have had a completely different tone. (Ah, the fickle media.) A lot can change in the next two years, and the circumstances in which a deal would be renewed would be based on the conditions when the contract is up.

Of course, the lack of newly signed "lucrative deals" shouldn't be a surprise to anyone. Management from both Sirius and XM have said that the major content deals are over. And there's no doubt that either company would evaluate the value of each deal to determine it's renewal cost (or if it would be renewed at all).

Rightfully so, as both companies are in the business to make money, not sign deals at any cost.

Now what if XM and Sirius were to merge? RBC Capital Markets analyst David Bank is cited in the article stating that, "a combined XM/Sirius would be able to negotiate a 20 percent decrease in each contract upon its renewal" thanks to the lack of competition in a merged entity.

Then again, what if the renewal deal wasn't lucrative enough for the content provider?

[New York Post via SSG]
Thanks Gary!

Joe Nocera has a nicely written piece in today's New York Times, I Want My Howard Stern and Oprah, that takes on the consumer's viewpoint... and he actually is in favor of a Sirius + XM merger.

It's an intriguing take on the situation, especially since in my half-hour conversation with Mr. Nocera the one quote he chose to include was the following:

"Choice is always a good thing," said Ryan Saghir, who blogs about satellite radio at Orbitcast.com — and opposes the idea of a merger.

It's an appropriate quote though because when I boil down my feelings on the rumored merger, especially from a consumer's standpoint (and one who subscribes to both services), I do believe that choice is always a good thing.

The article goes on to point out that since both services are mutually exclusive from each other, it actually reduces the amount of choice for the customer. This is especially the case when you look at automobile purchases, "nobody chooses a car based on whether it carries XM or Sirius," the article points out.

A significant aspect to highlight, especially for merger-hopefuls, is that former FCC Chairman Reed Hundt (who led the commission when it passed the rule preventing a satellite radio merger) said that he believes that the rule he helped formulate should be repealed. As Mr. Levin put it, "Circumstances have changed." (For those who are trying to keep pulse of what the FCC's underlying stance is on the possible merger, this may be your best indication yet.)

Nocera continues on with the theory that vehicles will eventually be Internet-enabled, at which point satellite radio will be "just another technology fighting to keep pace with the Internet." That with just under 14 million subscribers, satellite radio "has had a modest impact," and will eventually need to compete with "the greatest business model destroyer ever created: the Internet."

What Nocera fails to notice is that satellite radio is growing faster than any other consumer product sans the iPod. A fact that was highlighted in the New York Times only a couple weeks ago. While his piece is refreshingly fair and unbiased, the reality is that auto manufacturers are notoriously slow to adopt personal technologies (e.g., iPod jacks, Bluetooth, etc), and that the realistic expectation Internet in the car is quite a long ways away. It's not necessary for XM and Sirius to merge in order for them to survive.

But back to the issue of choice.

From a consumer's standpoint, it's not a merger that will allow for the increased availability of choice. Mergers never lead to more choice for the consumer (*cough* Comcast *cough*). XM and Sirius are far more than just Howard and Oprah, or NFL and MLB - the majority of what we listen to is music - and the result of a merger would be the inexcusable loss of the unique programming styles from both services. Those who say that the music offerings from XM and Sirius are "essentially the same" have obviously never listened to them.

No, the consumer doesn't need a merger. What the consumer needs is interoperability. Interoperability is something that is also mandated by the FCC, and hopefully soon, it's something that is becoming a reality.

[New York Times (subscription req'd)]