XM returns to Radio Shack - Orbitcast

XM returns to Radio Shack

| 37 Comments
XM available at Radio Shack
Radio Shack is now, once again, selling XM satellite radios and XM accessories as you can see from the snippet of The Shack's latest weekly ad pictured above. It's been a very long time (at least a few years) since we've seen XMs available as Radio Shack was persistently an exclusive retail partner to Sirius.

Could this be the result of a "reorg" in the retail side of Sirius XM Radio Inc. that occurred a few weeks ago?
A few weeks ago, Orbitcast received a tip that there were "layoffs" of retail support reps. After some investigation, I learned that the 3rd party company that handled big box stores for Sirius XM - BDS Marketing - was cut loose. These big box stores include Best Buy, and of course, Radio Shack.

There's little doubt that this move was to further the cost efficiencies in the retail sector. I reached out to BDS for comment, but received no reply.

Now here we are a few weeks later, and Radio Shack has picked up selling XM hardware again. A pretty interesting coincidence. Sirius XM are no doubt working on cost efficiencies across the board. And cutting out the middle man when it comes to managing retail relationships makes sense.

Either way, whether or not this is a result of cutting ties with BDS mktg, it looks like the consumer will be benefit with more availability.

[Radio Shack Weekly]
Thanks Karl!

37 Comments

They barely carry any Sirius products, either.

If I'm getting any sort of Satrad product, it's an online retailer for me (probably TSS if they're lowest price).

Who buys stuff retail anymore?

Could someone please explain why we still have two types of hardware? Seriously, what are the technical hurdles that prevent SiriusXM from behaving as one company?

Ryan,

This had NOTHING to do with the reorg. Radio Shack had product in stock for many months now, this is just the 1st time they have advertised products in a month. Its very common for retailers to go "black" with advertising products. but since you're not in the retail industry, i understand how you didnt know that.

what you dont know is Radio Shack went through 3 buyers that handled this category in 2009. And now the SIRIUS XM acct mgr that handles Radio Shack handles 1 other huge national retailer, plus many more accounts. How much attention will each of these accounts get now?

The layoff of BDS and other SIRIUS XM eployees had nothing to do with "efficiencies in the retail sector."

For many years now, the retail sector has suffored due to the lack of vision and leadership by the VP's hired to manage the retail side. If you want proof, let's take a look at a few items. Poor promotions (Rockin Rewards is a joke), Zero advertising (that crappy Elvis commercial around Christmas was garbage, which was done in house and the "Vision" of a person with zero marketing experience), Zero product innovation (the same radios have been out for years and each year they change the screens color and give it a new name, and the skydock has a piss poor design), and most recently the release of the field team that kept retailers up to date with trainings, assisted with events, and assisted with product sell throughs so new products could arrive sooner. This group of individuals cared more for the company than every one of the execs, including Mel.

During the 4th qtr 2009, when asked about the retail side of business, Mel replied that more focus was going to be put on the used car side of the business. If you are expecting a retail turn around, thats not going to happen. Especially not with the the out of touch, visionless leaders.

So there you have it Ryan. No new innovative products in years for retail, crappy promotions, a skeleton crew managing retail business (does doing more with less really work? Nope!) and now zero execution will be done in the field.

The entire retail side of SIRIUS XM has been a broken plane for years. Instead of landing and changing planes, SIRIUS XM is going to continue to fly and try to make repairs while airborn. The end result will be a crash landing, i guarantee it! Over the last 4 years upper mgmt has pointed the finger at select individuals and laid them off thinking business would get better with them gone, save a buck or two. take a look at retail numbers over the last 4 years. that downward trend speaks volumes. And these layoffs will continue. it will be interesting to see who they will point the finger at when everyone is gone and things are still broken.

In my opinion, with the current retail execs in place, SIRIUS XM retail = Epic Fail!!!

They've been carrying XM for a few months now around here in Richmond VA. I've seen the Skydock and the OnyX in several stores since around December.

well they sure aren't doing anything at our local Best Buy. There's been 2 large black display 'boxes' sitting empty and ugly on the Best Buy floor. No radios, no ads, just a small logo torn and worn from when they use to have radios on the displays.
Been empty for almost 3 years now.

awful!

@Rob Raw: An incredibly insightful and awesome comment post. So insightful in fact, that I think it deserves to be a post of its own on Orbitcast.

Would you mind if I "promoted" your comment to be an entry? I might do some minor word-smithing, but the essence of the post will be there.

SiriusXM's retail business is nothing but shit and has been since the merger began. XM had great radio's and better technology. Sirius has done nothing to improve either their own receivers or XM's since their takeover.

I couldn't give a shit about having hardwired XM in my car. I don't get why anyone would want that. Sure, it's a nice, clean install but then you need another radio to listen at home (with a higher additional radio fee plus artist royalties). I don't drive to work. In fact I live in a city and like thousands of people, I take public transportation to work. I drive about 1k miles/year. If I mostly listened in my car I'd hardly ever listen at all. And if the service is so great, why would anyone only listen in their car?

There's been nothing at all to be excited about or purchase at retail since the Inno. The XMP3 is nothing but a step backwards from the Inno. The Stilletto is discontinued and was an expensive brick of a product. Sirius's pussy stance towards recording content (backing off the ability to save/delete individual songs with no limit to make nice with the record companies) makes recording anything but talk shows a waste of time.

I have yet to walk into any store that sells SiriusXM retail radios and not been disgusted. Most displays are years old with ancient channel line-ups and obsolete products. These usually reside in the darkest corner of the store. In fact, every single kiosk I've seen lists pre-merger channel line-ups.

Either sell the product at retail and support it or don't sell it at all. To know that it's someones job at SiriusXM to manage the retail outlet and to see the results of this labor is embarrassing. Someone is getting a paycheck for managing this mess. One look at the retail display tells me to stay away from this product.

From what I understand, the birds still have slightly different codecs. Channels 0-3 on XM are used for subscription purposes, so you won't ever be able to put Sirius Hits 1 on Channel 1. This also means they can't merge the web sites easily because of the different channel line-ups.

They also can't go over to one set of sats quickly because they need to be able to support all the older radios they can, ESPECIALLY because the auto market is extremely important. If they were suddenly able to cancel all XM or all Sirius models, half the car makers might cancel out of protest. And casual subscribers don't want to keep upgrading equipment each year.

I think eventually they might move towards all XM based tech, based on a few decisions and hints, but it will happen slowly, and it would probably take sometime between 2015-2018 for them to completely phase out one of the two channels and replace all equipment.

Ryan - I have said it before and I will say it again and again -

The aftermarket will consist of 2 components eventually - used cars and cell phones.

And used car sub additions will eventually top new car sub additions. It's inevitable.

Anonymous, we still have two types of satellite radio hardware because there are still two sets of satellites, and the programming, while 80 or 90 percent the same, still differs. This will not change for many years, because there is now a huge installed base of OEM equipment on both the Sirius and XM side, and new equipment on both sides continues to be sold.

And, in reply to Rob Raw, for years I have felt that this company's lack of emphasis on the retail side of its market has been a serious mistake; thanks for explaining, at least in large part, why that has been happening.

sam,

Same issue with Walmart. They used to have a large display right out in the open with 40 or 50 radios on display. Now it has been reduced to just two pegs on a board next to the clock radios made in China.

Pathetic.

Rob Raw, I do agree with most of what you stated, with one exception. Why do you think the Skydock has a piss poor design? The PowerConnect technology which debuted on the Skydock is wonderful, and the integration of XM into the iPhone & iPod Touch has been nicely done. I also find it more aesthetically pleasing than other FM transmitters on the market.

This is also in response to JRT's reply to my original post.

Why don't they make hardware that can receive both types of sat signals? If that's not feasible, why don't they start phasing out one type of hardware and pushing people to the other with an eye on consolidation? Especially new car installs.

I was thinking the same thing. Who cares that unemployment is at an all time high? What do you do for a living?

If everyone shops on line who needs malls? Hell who needs to leave their house?

I think the main reason that the retail outlets have been so grossly ignored comes down to a matter of cost.

Sirius/XM has been on an expense-cutting binge since before the merger was made official; as a result, anyone and anything that appears to be an unnecessary expense has been broken off.

Mel and the gang seem to believe if you just throw up the stuff in a big box store, the public will buy it. Not so--they need to SEE it, be able to TEST it, and want store employees to KNOW what the product is all about. That's how they make a decision to buy.

As I've said, Circuit City was the one place that had a great display with knowledgeable workers, and they're gone. Best Buy has done nothing, and I don't expect the Radio Shack employees to know any more than anyone else.

Ignoring or dropping a few "spare parts" of the machine leads to the machine breaking down, and it already has. Mel's answer that, "Oh, we're gonna put 'em in used cars," is a non-answer.

It's very sad to see a great opportunity to bring something specialized and exciting to the public go down the pan as it has the past several years. One more missed opportunity, Mel; and you're running out of your nine lives.

An XM Radio,with the Best Of Sirius is the only way to go. Other than Stern,what reason is there to have a Sirius radio?

The "displays" in the Best Buys near where I live are beyond pathetic. A few hooks sticking out of a hunk of generic, True Value peg board, most of which are empty - and the only products I ever see are a Sratus 5 or 6, a 50 ft. antenna extension, a couple of Skydocks, one or two home docks, and maybe an FM modulator. Three quarters of the ramshackle display is empty, there is never a sales person in the area because no one is ever looking at it, or can't find it because it's in the very back of the store, next to vacuum bags and $20 blenders. Maybe it doesn't really matter; Sirius/XM has no idea how to market the product, how to create excitment for it, and has never done a single solitary thing to make satellite radio resonate with people under the age of 30. Most of the country is too busy texting and bullshitting on their cell phones to have time to listen to any radio, including satellite. They say the average teenager and 20 something texts 80 times a day; how would the little imbeciles possibly have time to give a crap about Sirius/XM, let alone anything else. The culture has radically changed, and just because something is great doesn't mean the masses are going to gravitate to it. Add horrible management that is clueless, and has zero vision and common sense, and you have the bleak retail situation that exists.

Just a bunch of corporate A-holes running this company, and most of them have no real love or passion for music, great radio, or anything other than increasing the width of their wallets. It's just business to them - no passion for the technology, product and service, and certainly NO EMPATHY whatsoever for the subscribers. It makes you wonder where satellite radio would be if it was run by people who gave a shit!

The great thing about XM's software/hardware structure is that it is highly updatable. The XM preview channel could be remapped to =any= channel number not otherwise in use. Same goes for the info and retail-barker channels. SH1 could go on channel number one tomorrow if so desired.

The reason the switch hasn't been made is that XM 20 is one of the most-listened-to channels on XM; moving it risks confusing the least savvy of its base (i.e., people listening to the same stuff they could hear on several stations in most terrestrial markets for nothing).

My guess is that, as the channels finish fully integrating, we won't hear anything about the channel number in the main part of the channel name; it'll just be "Sirius XM Hits on Sirius 1 and XM 20".

Oh, and the codecs are radically different: Sirius employs a propriety flavor of PAC, a codec which has otherwise been completely out of use for nearly a decade, while most XM channels employ the still-evolving HE-AAC system (albeit not at its most efficient; the parametric-stereo aspect of the codec, which would allow for much crisper channel separation, is not employed due to hardware limitations of a few early receivers that may still be in operation). There may not be any way to harmonize this aspect of the two operations.

Great points. I own three vehicles and none has XM or Sirius factory-installed in it. Back when XM was really good, I loved the concept of retail radios, as I could swap them between vehicles, use them at home, outdoors in my portable units, etc. When Cadillac came out with the record/pause/replay functions in its OEM radios a few years ago, I saw it at an auto show. But, I'd had those features for years on my inexpensive retail radios -- and I didn't even have to buy a Cadillac. I opted not to get XM in the newest vehicle I have, an '05, because I already had my XM units and was just as happy with them, and I saved the cost of another subscription. Also, I completely agree with you that the near-total focus on the automotive market is one of this company's biggest mistakes. I listen to far more satellite radio at home than I do in vehicles.

Also, to Anonymous on the topic of eliminating the two platforms, I think we're asking the wrong question. For all of the reasons outlined, yes, it will be hard to eliminate one platform or the other for a long time. But, this shouldn't even be the goal. The FCC originally licensed two services so there would be some choice and competition, with two systems available to consumers, with two separate channel lineups. The merger of Sirius and XM did not have to mean, nor should it have meant, the merging of all content between the services. The merger should have been front office stuff -- billing, customer service, etc., but not programming. This programming they're offering right now would not have attracted the 17-odd million subscribers they have.

On your point about the inter-operable radios (the ones that get both services), yes, they exist, but Sirius XM has killed any consumer interest in them because, with the services now all but identical, why would anyone subscribe to both? And, since they're focusing on OEM now, the whole point of inter-operable radios is moot because people are not going to have their dashboard torn apart to have a different satellite radio put in. Back when it was a good service that people loved, yeah, people might have done that, but they've shown many of their most devoted customers to the door by cavalierly dropping the programming half of their customers, including me, signed on to get. Right now, if they start making a stink about needing new equipment to stay tuned to satellite radio, most people forced to make these changes would just drop it and move on.

How important is retail? Put it this way - The longest running Sat radio blog - ORBITCAST - didn't realize that Radioshack has been carrying XM in addition to Sirius radios for over half a year now.

Sat Radio at retail is not important at all. It will most likely be totally replaced by an ever increasing aftermarket shift.

The aftermarket will be used cars oems and internet/cellphones. Used cars will eventually be more important than new cars, and cellphones will add to ARPU for existing subs. It's as simple as that.

Let me just add to my cellphone theory by saying that there are more cellphones in this country than there are cars (something like 275 million compared to 240 million). My belief is eventually all of the cell phones will have the capability of receiving Sirius Xm like iPhones and Blackberrys do currently. I also have hopes that the Skydocks can expand to other phones outside of the iPhone.

Why buy a sat radio if you have it already factory installed in your car or you can simply turn your cellphone into one? The answer is obvious and inevitable.

@Ryan, you have my permission to add any of my opinions into an article. And just as an fyi, i did some digging around and discovered that a vp on the retail side had a son working with that bds program. His son left in december, coincidentally a month before the layoffs. I wonder if his son knew in advance that the relationship with bds was going to end? Maybe his dad tipped him off? Just hear say i know, but interesting if it was true.

@Joe, the reason why i called the skydock a piss poor design is due to the fact there are plenty of cars it will not work in due to placement of the factory 12v socket. No doubt its a great product, however there should have been way more thought in the design. The skydock is exclusive to the ipod touch or iphone. The folks at sirius xm had to know an app was in the works for bberry (and most likely android and windows mobile phones), so why not design it in a way that you can plug the USB cable that comes with just about every phone that an app can be made for today tha would plug into the cradle (that plugs into your 12v socket), and then a universal cell phone bracket than would secure your device on your windshield or vents. They also should have added the ability to allow you to use the device to make and receive calls hands free. If they made it universal like how i mentioned, every person in the US with a bberry device today could go to a store and be listening to sat radio today. In my opinion they missed out on a huge opportunity due to the flaw in its design. But i guess since they dont market any of their devices, it doesnt matter. It would still sit on store shelves and collect dust like its doing today.

If cell phones replace retail satellite radios, Sirius XM will, at that point, be competing for listeners against everything else on the Internet. Sirius XM will be just another choice among thousands, in the unenviable position of trying to talk people into paying $15 a month for what competitors are giving away free. If I were them, that would be a day I would not want to see come any sooner than necessary, so I'd continue to sell the advantages of retail radios -- low cost, ease of use, no need to tie up a cell phone to listen to the radio, no need for wifi or 3G to make it work. And, along the way, I might think about providing a product that's a little edgier, a little less "screw you, we-talk-you-listen," with a little more of a premium feel to it.

The cellphone will obviously be an add-on to people that have already have their car subs. By the end of 2015 some estimates have as many as 90 million of the 240 million cars on the road, already having factory installed sat radios in them.

It's Sirius' game to lose. No one can come close to their car distribution.

Who wouldn't want to take Sirius with them out of their car and listen on the cellphone or the internet? It will be a great ARPU driver. But the sub numbers come from the car.

Can't really tell if you're being serious here or not...

While smart phones are a rapidly growing segment, they are still a minority of phones sold. I work for a large media company and while I have a company smart phone, I'm not allowed or authorized to put Sirius Apps on it. As for the average person in the office, most still have Moto Razors sitting on their desk. And these are people in their 20's and 30's, the target audience for these devices.

So you're telling me I now have to get a smartphone, 2 year contract with their ever more costly data plans and a SiriusXM app to listen? Seems I could spend a lot less getting a dedicated radio if the company were willing to make one.

And how are any of us going to record Howard/O&A or whatever your thing is. Last I checked, the app didn't allow recording of anything and didn't even include Stern. And the internet offering is less channels than I get on my radio, why would I want to pay for that?

Hate to tell you folks, but I believe it is going to be Internet-enabled Smart Phones, Pandora, and texting - just ask Jerry Del Colliano and Mark Ramsey. Users want control (eg. Pandora's personalized playlists), which Satrad and HD Radio cannot provide.

You said the cell phone is likely to be an add-on for people who already have a car subscription, and I agree. And, using your numbers, if in five years over 60 percent of the cars on the road still don't have OEM satellite radio, wouldn't that still leave a fairly sizable potential market for retail radios?

Good point xcountry. That's where I believe the Skydocks will be expanded to include all cellphones. If my premise is correct that eventually all cellphones will be capable of receiving Sirius XM, why buy another radio? Just dock your cell phone.

It all takes time. But I believe you are already seeing the aftermarket shift to used cars OEMs and cell phones, and away from retail radios. I think eventually we will see a total shift.

My opinion is this is inevitable.

I tried listening to Pandora twice. The first time I said this is cute. The second time I fell asleep.

It's extemely popular. I consider it no threat whatsoever. I think Pandora opened the door to radio content on the cellphone. Sirius' job is to monetize cellphone radio by providing great content.

Who could this BE?

Perhaps if you spent as much time in fixing the retail business as you have been trying to figure out who this could "BE," you could make an impact and start to turn around retail numbers.

Dont you have some memos to get out to retailers regarding the Q2 promo to help increase subscribers and move radios at retail? Let me guess what the next promo is, "Rockin Rewards?" If it didnt work the first 6 months, maybe it will work in the coming months?

No worries, im sure eventually you'll find something that works.

You should watch out....I know you are still with the company and interacting on bulletin boards like this one is strictly against SXM corporate policy....check your employee handbook!

What about that same VP's brother that is still with the company even though the retail team was virtually gutted? You know who you are MR....

I too left the retail team before the marketing company was dissolved. I don't know for sure how much in advance the reps were notified since I was no longer a part of it by December but it didn't take a brain surgeon to know that the ship was about to sink. I jumped off board in October and took a nice vacation from holiday retail before they had the chance to take over my life for 3 months only to be dumped afterward anyway. Maybe this person had the same forward thinking. Either way, I'm sure that he knew enough about the business to know that even his dad couldn't keep a job for him "just because" at a publicly traded company so who cares if he was told in advance.

As for retail not having reps anymore, I think you'll find that ALL locations will be in as bad of shape now that they aren't around anymore. With only about 10 people nationwide before the cuts, hardly anyone saw the benefits of a rep but in my territory employees were trained, everything worked, was displayed properly, and was up to date. I think the same could be said for the other 9 markets that were covered. It was amazing to see how quickly that went to crap just by visiting some of my old stores to shop a few weeks after I left. You can't place all the blame on Sirius XM but if they did invest in a real retail marketing team, you'd find 50 major markets with perfect stores, not just 10. Also, big box stores need to share the responsibility on some level. Getting rid of employees with a "not my problem" approach would help. I don't know about the people reading this board, no matter where you work, but me and the other reps took pride in our jobs and how things looked. I even used to manage a big box car audio department and the things I see now would not fly in the culture that existed only 5-6 years ago.

Sirius XM subscribers have control....... It changes the channel! You have to realize that people who want such explicit control over what they listen to will have everything they need. (i.e. itunes, mp3 players, etc.) People generally like to be entertained without having to play programmer. It's about content, not control. It's about hearing a random song that sparks a bit of nostalgia.

The issue with his dad telling him in advance (if he did) is that his dad would have shared private and confidential information with someone who was not part of the company. This would be a violation of the privacy policy his dad signed when he was hired. From what i heard his son had been tipping off some of the people on the BDS team since last summer that the program was coming to an end at the end of the year. Not sure why they stuck around, maybe they were really loyal to the brand and hoped the decision to cut ties with BDS would be changed???

Interesting to hear he has a brother on the retail sales team that has some how dodged the lay off bullet year after year. Since the entire retail industry has been in the toilet for years now and none of the channels are hitting their goals, its easy to draw the conclusion that his brothers assigned retailers are not hitting their goals. It would be great to hear why he's still around. Maybe his mom told him he cant fire his brother? would it cause an awkward moment at the Thanksgiving dinner table?

I also heard a retail VP still has an assistant. He keeps an assistant and lays off a sales rep? Does the assistant have an effect on retail sales? I would love to hear the logic behind that decision. You would think in tough times you would figure out how to book your own flights and ditch your assistant, and keep a person on board that can actually have an effect on your business.

Either way, the upper mgmt is in need of a desperate overhaul because the people in place are not getting the job done. I cant wait to hear the results from the retail channel in the Q1 earnings call. How many quarters will SIRIUS XM pay out 6 figure incomes to individuals who have no clue how to lead a team and have no vision?

EPIC FAIL!