Sun Sets on Satellite, But Premium Radio Plays On

Martine Rothblatt, founder of the company that became Sirius XM Radio, earlier this week expressed doubts about Sirius in its current incarnation, saying that the “better time for satellite radio was 10 years ago.”  While I’ve long argued that Internet radio would surpass satellite radio with the adoption of broadband wireless, and while that is indeed becoming the case, it’s besides the point. Sirius need not be confined to delivering content via satellite.

Albert Cheng, EVP of digital media for Disney-ABC Television Group, noted on a panel discussion on Tuesday that “ABC thinks of itself as a multiplatform entertainment company, with numerous distribution avenues, not simply a traditional broadcaster any longer.” Sirius needs to embrace a similar approach. I view Sirius not so much as a satellite radio service but rather a provider of “premium radio.” The HBO of radio, if you will. That is, its investment into aggregating premium content and programming ostensibly warrants the premium that end users are asked to pay. How that content is packaged and delivered will vary according to the various distribution platforms available to end users. 

Sirius is thus no different than HBO, Showtime, ABC or even The New York Times. Granted, the satellites that it’s spent hundreds of millions of dollars to deploy and operate may become obsolete or redundant in the coming years, but an obsolete distribution platform shouldn’t impact whether Sirius can make a business out of aggregating and providing “premium radio.”  Of course, whether they can do so, how long it will take and how big of a business it can be all remain to be seen.

Raghav “Rags” Gupta is V-P of International Partnerships at Brightcove, where he has worked since 2005. His blog can be found at www.ragsgupta.com.

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