Okay, so I'm a little late on this one. I had intended to write something about Howard's big announcement a number of weeks ago, but a frenetic work schedule here at the home office combined with my inability to turn Jerry Springer off (more on that in a future column) left me emotionally drained and dreadfully behind.
Two deep breaths... fingers find the keys... now I'm ready.
WOW! What a bombshell. The self-proclaimed "King Of All Media" is moving from the world of free tune-in to the subscription environment of Sirius satellite radio. This is not just any subscription environment; it's one that requires the purchase of new hardware, a tangible investment. Is this a good move? You bet your ass it is.
Now I truly don't care if you like Howard Stern or think he's a pig. The fact is, he's enormously popular, and this announcement not only sends a big shot across the bow of traditional radio, but it lends major credibility to satellite.
Over the next five years, Sirius will invest almost $500 million dollars just for the Stern show, which will require them to generate no fewer than one million new subscribers to break even. Can they do this? It seems likely based on Stern's fan base, but this is not a vacuum we live in, and the Stern deal is just the first major one of many A-list personalities that will take place during this time frame, ultimately feeding the machine.
Not too long after the Stern deal Sirius announced an exclusive deal with both the NFL and English Premiership Soccer to carry all radio broadcasts of their respective games. Their direct competitor, and the only other satellite radio operator in business today, XM Satellite Radio, conversely announced a deal with Major League Baseball, as well as one with former NPR Morning Edition host Bob Edwards.
Stern's new deal is clearly very lucrative for the superstar, but he's already wealthy beyond imagination. Howard could have negotiated a handsome new contract with his current employer Infinity Radio if he wanted to. Even though the saying in the entertainment business goes, "It isn't about the money, it's about the money," this time it's really about the freedom, the freedom from the gaze of the evil eye of the FCC. You see, the government does not police satellite -- not that they aren't being pressured by right wing fascists to do so, but right now it's beyond their grasp.
When Stern goes live on Sirius in early 2006, he will finally be able to generate the kind of programming he's always wanted to. And it is this very thing, my friends, that sets satellite apart from traditional broadcast radio. Freedom.
If you've already drunk the satellite radio Kool-Aid, no need to continue, but if you're still listening to Skippy and Flash In The Morning, you are required by law to read on.
By this point, though you've probably heard rumblings about satellite radio, chances are you haven't bought in yet. I mean, why would you? Pay for radio?! That's insane! Maybe. But have you listened to regular old radio lately? Sure, if you search a bit, you might find some good radio out there, but great stations are tough to find, and great shows on specific stations are rarer still.
Why is radio in the state it's in? Simple, station playlists are no longer at the discretion of the local programmers (don't believe them if they tell you so), and radio has been researched to death, to the point where those playlists are so narrow that only a small fraction of one percent of music is heard. When you treat music like toothpaste, this is what happens.
Traditional radio is dying. The fat lady is singing. If you're someone who keeps up with these kinds of things, you've no doubt heard talk of replacing the analog terrestrial signals broadcast today with digital, significantly enhancing the sound quality. But let me ask you, would you really care if that Gremlin you're driving received a new paint job at the Ferrari factory? Of course not, because in the end it's still a Gremlin and though it may shine brighter, it's still inferior. You want a Ferrari underneath that paint. Chicks dig the Ferrari. [Note: If you're a chick please substitute "guys love chicks who drive a Ferrari."] Make the audio sound better, but it won't matter; broadcast radio is still lifeless and limp.
So why then is satellite so great? Why should anyone have to pay for radio? Radio has always been free! Yes it has, but so was television, and if the stats are right, it's likely you're one of the millions of people in this country who are currently paying for either cable or satellite TV. I bet if you asked the average person on the street in 1978 if they would be willing to pay for TV, they would have flipped you the bird. But with more than 20 years of people paying a monthly fee for greater choice, niche programming, and in many cases increased quality (your honor, I admit into evidence virtually every original show airing on HBO), TV is most certainly the better for it.
The model is the same. Open things up, increase the offer with many more channels, raise the quality, add niche appeal, get rid of the commercials, and improve, improve, improve. Remember, people are paying. You're beholden to offering them a consistently better experience.
Between the two choices out there of XM and Sirius, XM is clearly in the lead with about four times the number of subscribers, but that's okay, as satellite is just getting off the ground, and over the next few years competition will heat up and these two providers will both grow.
In the beginning the big selling point was that the signal didn't fade no matter where you were in the country. Get in your car in California and drive to Maine and you'll hear the same crisp signal. As a satellite radio subscriber I can assure you, while this is a wonderful feature, it is not the number one reason to switch.
High atop the list of why you should get satellite radio is that when you turn it on for the first time and start moving through the channels you will recognize something strange but familiar -- great music.
You see, satellite radio is not programmed by a group of consultants. People who are passionately driven to provide you with the best experience possible program each channel. They actually want to introduce you to great new music. Of course, new music does not mean new recordings, but simply music that is new to the listener. A great '60s Aretha Franklin track that escaped your attention is no less valuable than a brand new U2 or White Stripes song released today.
If it were only about music, I could understand the hesitation by some to make the leap, but satellite radio offers news, comedy, the aforementioned sports, and live streams of many cable TV channels. Think of it as a portable version of your home cable or satellite TV service (minus the movies and images, of course) that you can not only drive around with, but also pop out of the car and bring into the house.
Satellite radio is the future. It finally delivers extensive, great programming for music fans from sources that are rooted in quality. Just as UHF stations and the action of getting up from your chair to physically change the channel on the TV set did not immediately disappear with the advent of cable TV, traditional radio won't die quietly. But mark my words; Howard Stern's announcement will have far reaching effects for the state of traditional radio when we look back in 20 years.
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