Changing Revenue Model...#6: Video
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The Satellite Radio Solution

Satelliteradio_2The proposed merger between XM and Sirius is old news.  As an XM subscriber, I'm still not convinced a merger is in my best interest.  Both companies are to blame for paying ridiculously high fees for exclusive rights to broadcast certain celebrities and events.  This gold rush mentality obviously isn't helping either company, but I think it's time to revisit the entire model.

Unless changes are made, satellite radio is either going to disappear or remain limited to a very niche market segment.  Despite the big names, free trial programs and other incentives, satellite radio is not on track to ever become mainstream.

I currently pay $14/month for my XM subscription.  The service promise is (more or less), "170 channels and most are commercial-free."  I've had my device for about a year now (and maybe it's my imagination but) it seems like more and more of those "commercial-free" channels now have commercials.  Every talk channel I listen to certainly does, and the music ones have several commercials for XM itself, so I wouldn't exactly call those "commercial-free" either.

My point?  I've accepted the fact that my $14/month doesn't free me from nagging commercials.  I'm still willing to pay it because of the sheer volume of content I can access.  So why shouldn't XM and Sirius embrace advertising rather than act like they're above it?  Make it a part of the service to help find the path to profitability!

Will some existing subscribers bail on such a program?  Absolutely.  But XM and Sirius could also create different levels of service to try and meet the needs of a larger audience.  Maybe my $14/month rate remains at that level, but you could get true, commercial-free service for $20/month if you're willing to pay that premium.  Does that create scheduling and programming issues?  You bet, but how hard would that be to overcome?!  Heck, I can't help but think that the vast majority of the music channels I listen to are almost fully automated anyway.

Again, I'd stick with XM even if they introduced non-XM ads to the music channels.  I'm always free to change channels, just like on TV, so I don't feel it's overly restrictive.  The bottom line is 170 channels with ads is still worth paying for to escape the 7 local terrestrial channels that are totally loaded with commercials!

Comments

Lee

I would buy XM if I could pay ala Cart -
I am in no way going to support Ruush Limbagh channels
Same for Cable and Sattilite TV - I want Ala Cart.

Currently only get news from internet.
Watch - Netflicks
Listen - Ipod

No Ads - No lying News - No violence(even commercials for violent movies are sick)
Just what I want to see/hear when I want to

You are what you eat and what you see/hear

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