XM's Forced Upgrade

from the oh,-yes,-we-have-to-make-money dept

We were just wondering how satellite radio was ever going to make money and it appears that the folks at XM radio are wondering the same thing. To try to help move the process forward, they’ve decided to force everyone to upgrade to some premium services. The article describes it as a price increase, but also notes that premium services that people could pay extra for before are now included. That sounds more like forcing people to sign up for premium services they didn’t seem to value that much before, rather than just a regular price increase. That’s not a knock on the premium services — some of which sound great. However, it does raise more questions about how XM and Sirius are ever going to make money.

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Comments on “XM's Forced Upgrade”

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RJD says:

This is why people like to own digitial content ..

The constant spectre of raising monthly fees will always be a detterent to people adopting services like Siruis, Napster, Tivo, etc. Most of us put up with it on our TV cable bills … and now have the satellite option for video content .. only because there are few viable alternatives for video programming available (at least at this time). With Sirius & XM competing with freely available Radio, Internet Radio and the iPod, the prices going up are not going to aid in attracting new subscribers. On the other side of that ugly coin; if they don’t raise prices or increase subscribers, they will only continue to lose money. It’s a real bit** when your business model doesn’t work.

Precision Blogger (user link) says:

Re: Re: This is why people like to own digitial conten

When satellite radio hits you with a price increase, you can walk away, but you will lose the hundreds you paid for your receiver(s). If the two companies merge you’ll have quite a monopoly in this space.

We should want satellite rdio to succeed – it’s a cool, hi fi unfettered idea – but we must also hope they have some competition to keep their rates lean.

ffuege (user link) says:

No Subject Given

It’s not that they’re forcing you to take on the premium services, it’s really that they’re having a rate hike and they decided to drop additional charges for the premium services to help make up for it.

They probably would have seen a big drop in premium service subs if they just raised the price and then they may as well not have them. I think it was a good move.


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