COMPANY BACKGROUND
SIRIUS Satellite Radio was incorporated on May 17, 1990 as Satellite CD Radio Inc. On November 18th 1999 the company changed their name to SIRIUS Satellite Radio Inc, which is the name under which the FCC license to distribute satellite radio was given to. SIRIUS Satellite radio currently offers over 100 of music, news, sports, talk, entertainment, traffic, weather, and children’s programming to subscribers throughout the United States.
Their primary source of revenue is through subscription fees, with most of their customers subscribing to SIRIUS Satellite Radio on either a monthly or a yearly basis. They also derive revenue from activation fees, advertising sales on non-music channels and the direct sale of SIRIUS radios, which are currently sold in over 6,500 retail locations around the nation. As of December 31, 2004, SIRIUS has had over 1.2 million subscribers and 375 employees.
MARKETS
The overall market for Sirius is any consumer that listens to the radio. The target market that Sirius is aiming for is the 100 million automobiles currently on the road today. Sirius only has to gain a small portion of this market to become a profitable company.
COMPETITION
Sirius faces competition for both listeners and advertising dollars. In addition to pre-recorded entertainment purchased or paying in cars, homes and using portable players, Sirius competes most directly with the following providers of radio or other audio services:
XM Radio. Sirius’s direct competitor in satellite radio service is XM Radio, the only other FCC licensee for satellite radio service in the United States. XM Radio broadcasts certain programming that we do not offer. XM Radio service is also offered as an option on various car model brands, certain of which do not also offer SIRIUS radios.
Traditional AM/FM Radio. Sirius’s competition also includes traditional AM/FM radio. Unlike SIRIUS radio, traditional AM/FM radio has had a well established market for its services for many years and generally offers free broadcast reception paid for by commercial advertising rather than by a subscription fee. Also, many radio stations offer information programming of a local nature, such as local news and sports, which Sirius does not offer as effectively as local radio. Some radio stations also have begun reducing the number of commercials per hour, expanding the range of music played on the air and experimenting with new formats in order to compete more directly with satellite radio services.
Internet Radio and Downloading Devices. Internet radio broadcasts have no geographic limitations and can provide listeners with radio programming from around the country and the world.
Howard Stern is a radio personality, producer, actor, author, and is the self proclaimed “King of All Media”. Stern is widely known for “The Howard Stern Show”, which was aired on FM radio from 1986 to 2005, until it moved to Sirius XM Radio in 2006. Stern specific style of “shock jock” radio is what makes him so popular, taking him only four years to get his show nationally syndicated in 1986.
market is a set of buyers sharing common needs or characteristics that the company decides to serve (Bethel, 2007). When identifying the target market it is important to know who buys your product and who your customers are. Smart targeting benefits the consumer as well as the company. It allows the company to be more efficient and effective by focusing effort toward that segment; therefore maintaining the most profitable outcome. The consumer is rewarded by receiving the product or service that is customized for them.
-By 1939, the Grand Ole Opry had become the most popular and important music show on the radio.
Music Television, a basic cable service known by its acronym MTV, remains the dominant music video outlet utilizing effective marketing and competitive business practices throughout its nineteen year history. The creation of the "I Want My MTV" marketing campaign and use of the campaign throughout the 1980's helped the cable outlet secure a substantial subscriber base. MTV dealt with competition from cable mogul Ted Turner's Cable Music Channel by creating a fighting brand, sister cable service VH-1, along with facing challenges by numerous other music video programming services. Through exclusivity agreements with record labels for music videos and limiting access to cable systems owned by MTV's parent company, MTV exercised anticompetitive and monopolistic means to fend off competition. From its launch, MTV successfully applied these marketing and competitive business practices. The board of the Warner - AMEX Satellite Entertainment Company (WASEC), a partnership between Warner Communications and American Express, gave approval in mid-January 1981 for the creation of a cable service that would broadcast music videos . Music videos, song length visual depictions used in the promotion of a musical act's latest release, were already popular on European television since the mid 1970s. A deadline of August 1, 1981 was set for the launch of this new cable service as programs featuring music videos were beginning to appear on cable outlets such as Home Box Office and USA Network. The set-up and programming of the entire operation was to be established in approximately six-and-a-half months.
The Boston radio scene has changed a great deal since WRBB’s inception in 1968. Amid all of the corporate turnover and company buyouts, college radio in Boston is often left out of the important radio history of the ninth-largest media market in the country.
DISH Network was organized as a corporation in 1995 under the state laws of Nevada and began operation on March 4, 1996. They are primarily focused on delivering high-quality video entertainment. DISH is a publicly traded company with common stock on the Nasdaq Global Select Market and is traded under the ‘DISH’ symbol. DISH is a nationwide company, and is the United States third largest pay-TV provider. DISH Network’s three main business subsidiaries are DISH, Blockbuster, and Wireless Spectrum. DISH pay-TV service is a direct broadcast satellite pay-TV provider which had 14.056 million American customers as of December 31, 2012. Blockbuster offers movie and video game rentals and sales through retail stores, mail, digital devices, the blockbuster.com website, and the ‘Blockbuster on Demand’ service. Wireless Spectrum is a $712 million acquisition of certain 700 MHz wireless spectrum licenses, a $1.365 billion acquisition of DBSD North America, and a $1.382 billion acquisition of TerreStar. Dish is currently “evaluating their option to commercialize these assets”.
Broadcasting involves specific rules and regulations that must be followed. The paramount justification for regulating broadcast is the scarcity rationale. The radio spectrum is extremely large, and cannot assist the needs of everyone who wants to broadcast. The spectrum as a whole relies on the government to manage and operate it. It is up to them to decide what broadcasters will best serve the public. A scarcity rationale case, NBC v. United States arose when regulations and restrictions were put on radio stations that were to protect “public interest.” Radio Networks proceeded to test the guidelines and licensing laws, resulting in the FCC gaining strong power over regulations of the radio spectrum. Although the Communications Act provides equal opportunities to all candidates with equivalent broadcast time, it still did not confine the FCC from having overall control.
In 1968, the station changed their talk radio format (with on-air personalities such as Bob Crane) to an all-news format that has successfully carried it into the present day (“KNX 1070 NEWSRADIO…”). This station is a communications vehicle that simply performs. The amount of advertising on KNX is truly insane. I would estimate that KNX’s commercials consume 3 times the airtime of local music stations.
However, satellite radio is banking on a commercial free format to steal listeners away from terrestrial radio. Sirius offers 65 commercial free channels of music and 55 news, sports and talk stations. And the one thing that satellite has over its less lofty competitor is that you can’t loose the signal as you drive across America. The two major competitors for the satellite radio listeners are Sirius and XM.
These target groups spend an extraordinary amount of time listening to radio, especially in the car, and should be extremely receptive to the XM product due to their constant need for radio entertainment and willingness to pay for it.
Netflix utilizes a number of different advertising methods. Netflix created a coupon in the form of an enlarged movie ticket offering a free month of service. These “movie tickets” are given out at cash registers at all Best Buy stores and are included in packing boxes of most of the major DVD player manufacturers (Sony, Philips, Toshiba, Panasonic, RCA, etc.). Best Buy’s website also has a link directly to Netflix which is under the “DVD rental service” drop down menu. Each DVD mailer sleeve from Netflix includes a tear off “tell a friend” certificate with a promotion code that provides the bearer with a free month of service. At one time, Netflix sold banner ads on their websites. However, they abandoned this strategy after three months because the revenue stream was not sufficient to cover the cost of maintaining the ads. Netflix also has an aggressive affiliate program. The affiliate program encourages other websites to provide links to Netflix and offers a referral fee for linked new members at a range of $9-$12 per member. This fee is dependent upon the number of referrals provided in a month. If a site is successful at delivering greater than 200 new customers in a month, the referral fee is negotiable, up to $30 per new customer. Netflix is a straightforward company. It rents DVDs via the Internet and sends them to you through the U.S. Postal Service. For a flat fee of $19.95 a month, you can build a list of movies at the Netflix.com Web site that you want sent to your home. The company sends you the first three along with prepaid return envelopes. When you're ready to send them back, you put them in the return envelopes and drop them into any mailbox. The minute the return is processed, the next one, two, or three DVDs are on their way. Depending on where you live, the turnaround time is two to five days.
Individual radio and TV stations are responsible for selecting everything they broadcast. Stations are responsible for choosing their entertainment programming, as well as their programs concerning local issues, news, public affairs, religion, sports events, and other subjects. They also decide how their programs will be conducted and whether to edit or reschedule material for broadcasting.
The radio has evolved over time. The radio we listen to today has a different format, purpose, viewer reach, and clarity than it did before the 1950s. The radio has survived the threat of the television industry by changing with the times. It has been dealt with in the law through acts and the creation of the government regulating agency (FCC). Today the radio is the cheapest and most affective way to communicate with everyone around the world. It began with the invention of the telegraph by Samuel Morse in 1844 and developed as the knowledgeable minds of inventors and engineers worked from the late 1800s to the present to create the powerful communications medium we know today as the radio.
FM is since the frequency is varied, station takes up more room on the band.
Competition for profit. There are some exceptions, as most newspapers, magazines, record companies, and TV and radio stations strive to produce a profit for their owners and stockholders, assume a watchdog role on behalf of their readers, if they do not make money, they go out of business. The consumer is the ultimate source of this profit. Mass communication organizations