Subscription based satellite services like Sirius were starting to come under pressure with the growing number of internet radio apps on smartphones. However, a new Trefis Research report suggests that a new technology (patent filed by Verizon) that would allow satellite radio services to be streamed straight to smartphones might give Sirius XM an edge over internet radio apps like Pandora.
The logic behind this claim is that it can be costly to stream Internet Radio. AT&T charges $15/month for 200MB of data usage and $25/month for 2GB. But Sirius XM’s main service fee is $12.95/month, which might become attractive to anyone who listens to music frequently.
But the report also notes that Sirius XM faces hurdles from the roll out of 4G and the increasing penetration of HD Radio in new cars.
Here are some key statistics on Sirius XM from the Trefis report:
– The number of Sirius XM subscribers from the retail camp will drop by half by 2017, falling from a peak of 8.91 million retail subscribers in 2008 to 4.35 million in 2017.
– Automotive subscribers will nearly double to 25 million in 2017, up from 13.1 million last year and a projected 15.1 million by the end of 2011.
– Sirius XM pays out $200 million a year to its automotive partners.
– Sirius XM radios are found in 60 percent of new cars and 46 percent of these radios are activated on a paid subscription.
– Sirius XM radios are now in about 30 percent of used cars.
– Over 70 million cars will have factory-installed Sirius XM radios within the next five years.
– Over 1,500 radio stations and climbing broadcast in HD Radio.
Via: CE Outlook.