Sirius XM CEO Touts 360-Degree Listening (SCN)
At the Sept. 15 Bank of America Merrill Lynch Media, Communications & Entertainment Conference in Los Angeles, Sirius XM CEO Jim Meyer said his company’s new 360L platform will “let us greatly enhance the amount” of two-way services it can provide to subscribers. The next-generation platform, which stands for 360-degree listening, was designed to make “the integration of wireless connectivity and our satellite connectivity seamless in the vehicle,” he said. Meyer added that satellite radio is “not a necessity — it’s not the same as wireless.” Kids today will “give up a lot before they’ll give up” their smartphones, he said. “We’re not that. We’re more of a luxury. And so, we have to make sure all the time that we don’t put any obstacle in place to make that ability to subscribe to us and continue to subscribe to us seamless and easy. And 360L will also give us that capability,” he said.
There’s been a positive reaction from automakers to 360L so far, he said. Sirius XM will be showing more demonstrations of it later this year, he said. But he cautioned that it could be a while before the new platform is added to vehicles actually available for sale. “We’re working on model years that are out three, four and five years. So, any new technology just takes time to go through their development cycles,” he said.
Meanwhile, when Sirius XM announced a contract renewal with Howard Stern in December, the company said the agreement included a provision to launch an exclusive Stern video service. “We’re not quite ready to say when we’ll launch it, but we’re very focused on launching it,” Meyer told the conference.
Asked if the Stern pact could lead to other Sirius XM video services, he said:
“It’s a great question and it is one I am not sure of the answer yet.” But he went on to say that with the “powerful broadband networks that are two-way networks that are now out there through your phone, through your home … I think the meshing together of video and audio is coming.” Sirius XM is “not going to be Netflix — we’re not going to produce 60 channels of video and try to compete with that kind of business,” he said, adding: “The question that we’re focused on today is, do our customers want video,” be it short-form “or some other form of video as part of that audio experience?”
Meyer said he doesn’t see video as something that is going to be a “big business that we’re going to generate tons more revenue from” now, he said. But he said it remains to be seen how significant it could be in the future to, among other things, prevent subscriber churn. “We’re going to walk into this, not run into it,” he said.
Asked if Sirius XM would consider buying a music streaming service such as Pandora or Spotify, he said Sirius XM has studied those companies but “we don’t need to buy a streaming company to have the competitive streaming capabilities we think we need to be competitive for the next decade.” He added: “We can do that ourselves. We have that capability. We have those skills. So, there’s no urgency that says we have to go buy one for that. We would only go down that path if we truly believed we could run that business successfully and provide the type of shareholder return that we believe we’ve told our shareholders we can get. We haven’t seen that yet.”