By now, everyone knows about the price increases Sirius XM is imposing on its users (because of all the marketing messages, I reject mail from their “Customer Service” department and so was a bit behind-the-curve on this). In case you don’t, they are:
- “Family Plan” Radios Increase: Pricing for additional radios on the “Family Plan” are going from $6.99/month to $8.99/month, a $2.00/month increase.
- XMOnLine No Longer Included: Pricing for XMOnLine, currently included in radio subscription for “normal-priced” packages is moving to $2.99/month additional per radioID. The bitrate is rumored to increase to 128kbps (nowhere near the “near-CD-quality” they are touting, and exactly the same as the old AOL radio feeds used to be before AOL dumped XM and went with CBS).
“But wait,” you say, “didn’t they promise the FCC and Justice Department they wouldn’t raise rates for three years? Didn’t Mel Karmazin say that he thought prices would go down after the merger?” Yes, and yes…Mel found a loophole in his agreement with the FCC, so he can raise prices for pretty much everything except the $12.95/month “standard” rate, and he knew at the time he was lying his rear-end off about everything else. If you review his statements during the merger he said anything anyone wanted to hear to get it approved, in some cases telling separate agencies opposite things (he told shareholders a merger wasn’t necessary for profitability of Sirius, while he told the DoJ the merger was vital to the company’s survival, for example), so that he would violate the spirit of his agreement with the FCC shouldn’t come as any great surprise.
Note you can avoid the problem by paying for a few years in advance, “locking-in” your price now. Of course, that assumes you would be willing to give a few hundred dollars to a company preparing bankruptcy filings in the event it can’t sell itself in the next five days (the $175-million debt payment is due, if memory serves, on February 17th).
So yes, in a desperate (and far too late) grab for cash, Mel is raising rates while preparing bankruptcy filings and hoping to sell the company before that’s necessary.
So what does this mean to the shareholder? You’re screwed, get over it.
So what does that mean for the subscriber? You’re screwed, get over it. If you enjoyed listening to XMOnLine when not in your car, plan on paying more for it. If you have multiple radios, plan on paying more for them. If you have only a single subscription, well, you won’t notice much change for at least five days, but after that, no one knows.
What am I going to do? Not perfectly certain yet, other than being absolutely sure I will be paying less. As I mentioned before, I pay for my parents’ XM radio, and they love a channel or two that haven’t been radically altered (yet) by all the changes…I would feel terrible yanking that out from under them, so I’ll need to swallow the $2 extra for their radio.
I have two radios here at home we’re paying for, though, and I’m pretty certain one of them is going to go. I’m going to miss the Inno, with its portability, but since the Passport Mini-Tuner currently serves three Nexus radios (one for me, one for my wife, and one for the Katester), and that’s the one we have multiple docks (car, home, etc.) for, it looks now like the Inno is going to be mothballed, joining the Roady2, Tao XM2Go, and assorted accessories in that box-o-junk in the basement. And the only thing that is keeping the Mini-Tuner turned on is The Bob Edwards Show - anyone mucks with that, and I’ll buy my parents a Slacker radio, load it with the music they enjoy, and cancel both the surviving radios. Truth is, we’re talking about canceling both our radios, leaving my parents’ radio the only activated one, paying the $2.99 for an Internet account for me to listen to BES, and replacing the car cradle with an MP3 player (not an iPod, something not locked into Apple and the bloated iTunes) for music and talk on-the-go. No decision has been made yet, but you can bet I’m going to do something to lower my payments to SiriusXM, at exactly the time the company cannot afford lower revenues!
Yeah, I am that angry.