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Comment by kevinherron | Hacker News Reader

Wait, what?

I’m already surprised SiriusXM is still somehow around, let alone that they have $75 million to invest in another company and not that they’re taking $75 million to stay afloat...

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The market cap of SirusXM is almost $32bn, roughly $5bn more than Spotify.

Wow. I know like every new car comes with a trial but I didn’t realize people actually activated it.

They have an incredibly efficient negative cancelation program that hikes the teaser rate to something like $45/mo.

And that's why I never even activated XM on my new car even though it came with a 1 year free trial.

I have Pandora Plus $5/month.

Also owned by Sirius btw

I didn't know that. At least it's extremely easy to cancel my Pandora subscription and they don't hound you like XM does. XM sends me a letter a month even though I never signed up. I'm curious how long they'll keep it up.

They used to send me a ton of letters, even phone calls. You can opt out of that, as I did, and they will stop it.

Cancellation is also by phone call only, which creates a lot of friction. I’ve tried to cancel a couple of times, and let it lapse once, and they always end up dropping my rate to $4/mo. Hard to say no to $50/year for 150 more options in your car. Even when the bitrate is like listening to a 1998 mp3.

It is indeed surprising to me that people can tolerate the low bitrate sound. I would consider subscribing but I can’t stand to actually listen. Do subscribers get a higher bitrate? My impression is that it’s a limitation of the satellite signal bandwidth and the number of channels they cram into it.

I have worked in the music streaming industry.

We did not try to cheat with bitrate but I am confident that only 1/100000 users would actually notice any difference between 128kbit/s and anything higher.

Even going lower than 128, you would be surprised how low you need to go before it really becomes noticeable to end users.

Yeah, I'm looking at getting one of the cheap teaser receivers at BBY and then activating it on a Privacy.com card or a giftcard or something, so they can't pull that even if I forget or am unable to navigate their cancellation hoops.

I recently tried to subscribe to XM radio using multiple pre-paid Visa cards (for the same reason you outlined above) and all were denied. It also seems that using a credit card that expires before your subscription lapses won't help you either. They will send a bill to your address on file and report you to a collection agency if you do not pay.

Giving expiring card information does not magically make you not liable for a charge. It just makes it harder for them to collect and (hopefully) harder for you to forget about the charge.

I have probably 6 or 7 paid subscriptions for my personal use. Aside from Netflix, SxM is probably the one I would cancel last of the group.

What are your use cases? 6 or 7 seems like a lot.

Not the person you're asking, but it seems it's very easy to get to 6 or 7: Netflix, Prime, Hulu, HBO2Go, AppleTV+, Disney+, Spotify, SxM, etc

I think like the person you replied to I misread is as having 6 or 7 SxM subscriptions, which sounded like a big flex "I have 6, maybe 7, cars".

6 or 7 paid subs sounds reasonable.

> Aside from Netflix, SxM is probably the one I would cancel last of the group.

I read it that way as well right up until I read the rest of the comment where the last sentence made it clear.

My mistake. 6 or 7 DIFFERENT apps. I have one Sirius sub that we use in the one car we own.

Yeah, I originally misunderstood and thought it was that many SxM subs. Was a little confused. Makes more sense now.

I had 6 for a while. Three cars, two home stereos, and a handheld. Most of those eventually became obsolete as the app and Sonos integration became usable, so now it's just in the cars.

DAZN WWE TuneIn JeFiT Spotify Netflix Sirius Dropbox

Does not include subs I use for my business like GSuite, Freshbooks, Front, Zapier, Monday, etc.

I use and love it in all of my cars. I have Spotify and Apple Music too, but there's something about actual "radio" without commercials that I enjoy for longer drives.

Sirius is the only decent music discovery service for me since there's some actual human curation going on (at least on their main channel lineup). Spotify is nice when I have playlists prepared and ready to go but that takes work and I get tired of most of my playlist content after a week. Discover Weekly is garbage, and Google Music's version was far worse. Never tried Apple music.

But I've also noticed the repetition on SXM but I've settled on 3-4 channels I like so I switch between them to combat staleness.

A number of stores use Sirius for their background music too.

Even more impressive than the market cap previously referenced is their actual business is vastly superior to Spotify.

Sirius 2019: $7.8b in sales, $1.7b operating income

Spotify 2019: $6.7b in sales, -$73m operating income

Spotify's market cap is supported by a fantasy that one day, somehow, if they get big enough they might generate a real profit to support their Wile E. Coyote valuation (don't look down). So for example, if they get to $20 billion in sales (in another 10 years), maybe they'll spit off as much profit as Sirius does right now in exchange for a similar market cap.

Man, I did not know these facts. I would have never guessed.

Spotify has solid user growth, and just invested heavily in the podcast ecosystem. Also they just reintroduced 3-month trials for their subscriptions which slows conversion and therefore revenue growth. Of all the tech companies out there, I think Spotify ranks among the more solid ones.

Compared to Spotify, SiriusXM has lower content costs (favorable statuatory licensing rates and a larger fraction of exclusive owned content) and a better user demographic (wealthy middle age Americans). Their churn rate is negligible.

When I've had to cancel the service, their sales department is pretty aggressive in talking you out of it.

For others, it's a highly compelling service. I know people who subscribe just to listen to Howard Stern.

SiriusXM has no competition in the satellite radio space as far as I know.

US and Canada only.. sigh

This might actually be the one case where this limitation is not entirely artificial. :-)

The SiriusXM sattelites are in an inclined eliptical orbit with the highes point being over the norther hemisphere. This is the so called Molniya orbit, named after the first Soviet sattelites using it:

https://en.m.wikipedia.org/wiki/Molniya_orbit

(Soviet Union had a lot of territory in higher latitudes where geostationary sattelites do not work well & the Molniya orbit needs less energy to achieve.)

So in the SiriusXM case, the sattelite would be much too low to provide useful coverage when over the southern hemisphere. And even when. As for not covering EU/Asia - this could be due to either the highest point of the orbit being always over US (guessing there) or due to ground station coverage when the sattelite is not over US.

And in addition population density is higher in Europe than U.S., menajng that the density of FM radio (and modern attempts like DAB/DAB+ etc.) and mobile cell base stations is also higher, thus those provide more competition.

In 2016 Sirius discontinued broadcasting from tundra orbits. Their newest FM-5 uses geostationary. [1]

Satellite radio was tried a few times in other geographies, but only in North America did it succeed. [2] In 1999 Worldspace launched for EMEAI, and looks like it collapsed in 2008. MobaHo! was a mobile satellite digital audio/video broadcasting service in Japan whose services began on October 20, 2004, and ended on March 31, 2009.

[1] https://en.wikipedia.org/wiki/Tundra_orbit#Spacecraft_using_...

[2] https://en.wikipedia.org/wiki/Satellite_radio

Interesting, I totally missed that they use GEO now!

Still pretty cool that one can receive digital radio without a directional antena from a satellite all the way up 36000 km in GEO. Though looking at the article about Tundra Orbit you have linked it was 25000 x 39000 km already, so not that much of a difference.

Don't they have some kind of deal with auto manufacturers, putting their system into every car coming off the line?

Yes, they have different programs with different manufacturers.

Almost all of them include between 3-12 months of free service (I think specific lines in Chrysler's lineup across brands are the only ones with 12, Alfa Romeo I know of specifically).

A lot of vehicles it's actually considered an "upgrade" to the stereo system and is only included with the more premium package.

A lot of people buying cars usually ask about it having Sirius or Satellite radio; they've been adding a lot of new shows and stations like comedians and they have a lot of sports. Their comedy channels are very similar to comedy podcasts and they've been growing this lineup. Having it all integrated into your vehicle without having to plug in your phone is still a big feature with older people and even some younger ones.

They also own Pandora.

Yeah but their real competition is streaming audio services.

It used to be that Sirius and XM were two separate companies providing competing services. Unfortunately in 2008 the US DoJ allowed them to merge on the basis that FM & internet radio were sufficient competition.

I don't think they were wrong. Sirius or XM may not have survived on their own. XM was on the verge of bankruptcy as it is.

Is the DOJ ever denying merger anymore though? European here so probably biased but I feel like US regulatory tools have taken a serious step back the last 15 / 20 years

The DOJ sued to stop the merger of AT&T and Time Warner (DOJ lost). The DOJ sued to stop the merger of T-Mobile and AT&T when they tried a few years back (AT&T backed down). It also sued to stop the merger of T-Mobile and Sprint (DOJ settled).

I thought the same thing until I interviewed there in 2017 and got a look into what they were doing behind the scenes. At the time, they were definitely not struggling. They were working on transitioning their core competency toward streaming services, but their satellite radio business was still alive and well. (I took another offer, which I regret in retrospect, because I ended up working on a Perl 5 stack...)

They are a very big deal for aviation. My plane uses XM in-cockpit weather products.

But ADS-B is catching up and quickly. I understand there are a few additional layers in SXM and the resolution is better when looking at 200+NM. I find SXM weather to be kind of extortion because they use publicly available data and sell it just for packaging it nice.

ADS-B isn't a weather product, is it? It tells you where other planes are, it does not tell you about cloud layers, winds-aloft, or other meteorological data. Unless I'm incredibly mistaken.

SXM carries this (along with a ton of other products) in their stream, alongside the audio channels that most people know. Their agricultural products, aviation products, stock-market feed, fuel-price data, and more, are valuable to various markets who buy specialized displays with the receivers integrated into them.

You are mistaken https://www.faa.gov/nextgen/programs/adsb/pilot/#fisb

How do you feel about all local news channels, all radio stations, and all weather websites using freely available NOAA data as part of their income-producing content? (Or maybe there is some special thing you know of where those outlets have to pay and SXM gets it for free?)

because they use publicly available data and sell it just for packaging it nice.

Aren't you missing the part where they're sending it to you 10,000 feet in the air via a satellite constellation? That's a little more than "packaging". You're free to access the public data by any other means you choose.

I used to have XM weather. The data is generally better, and it works on the ground, but I couldn’t justify the $30/mo for the kind of flying I do. ADS-B weather is “good enough”.

I don't understand satellite radio.. Ok in an airplane. But why in a car? In the Netherlands all radio is FM and its for free. Why would somebody want satellite radio...

I guess there is no full country coverage of FM in USA?

There is, but you won't find a station for every genre everywhere you go. I doubt you'd find that anywhere to be honest.

I never understood it until someone I know had it in his company car. He told me they pay for it because when they do long distance, FM networks would keep switching. That's when I understood their market. The current top comment is from a truck driver that pretty much confirm this.

In road trip you never had channels that stop receiving? They pay 5$ a month to avoid to switch in theses situations ;).

satellite radio doesn't have commercials

There is probably several FM radio stations in range of you wherever you are on the interstates in the United States. However, there may not always be stations in the genres of music you like. The frequencies are also not always consistent so as you travel from city to city you'll have to scan around to find something you may enjoy listening to. Its not like you can tune in to an FM talk radio station in New York and expect to still be listening to the same thing on the same frequency in San Francisco.

Once you throw mountains into the picture, it becomes pretty hard to have coverage everywhere.

They generated > $2 billion revenue during 2019Q4...

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