Sirius XM CFO on Howard Stern's Future, Why Company Won't Launch Abroad
LONDON – Satellite radio firm Sirius XM Radio, which is controlled by John Malone's Liberty Media, would like to keep Howard Stern on the air when his current contract with the company ends, CFO David Frear reiterated here on Tuesday.
Speaking at the Bank of America Merrill Lynch Global Telecom and Media Conference in a session that was webcast, he reminded investors that Stern's contract was coming up at the end of 2015. Last time around, "he signed the contract and said he couldn't believe he did it again because of how early he has to get up," Frear quipped.
He added, "I do think he loves what he is doing…. I think he loves the creative freedom that he gets on the Sirius platform. I think he loves the reach that he gets." Concluded Frear: "As long as Howard wants to work, we'd love to have him on the air."
The CFO also said Sirius XM has no plans to launch in international markets. "In Europe, it would be seven years before the first positive cash flow dollars," he said. "There seem to be better ways to spend time."
With such different markets, cultures and demographics, key questions would be whether to offer 30 or 50 channels in each city. In the U.S., the company has 150 channels for people who share a culture, Frear argued. "It's a less compelling product offer when you move outside the United States," he said.
He lauded Pandora, Spotify and other streaming music companies for growing their subscribers. But he said there are "pretty challenging economics for streamers" because "free sells best."
Asked if Sirius was planning a push into video services, the CFO said, "it is hard to experience video in the car," so video is not a focus. But with self-drive cars likely to become a market opportunity down the line, he said there is no technical reason that Sirius couldn't offer video.
Discussing Sirius' programming lineup, Frear said "there isn't any piece we are missing" and that "there isn't anything we wanted to keep that we haven't kept." He added that the NHL is the only big sports contract that was reached before the Sirius-XM merger that created the company, which has been striking new deals since. The NHL contract comes up in about a year, he said.
Asked about the most important content for Sirius, Frear said, "It's hard to ignore the singularity of Howard Stern," calling the radio host a "phenomenal" talent. But he also cited the NFL, MLB, NBA, Fox News, CNN, CNBC, BBC and "other great brands" as allowing Sirius to offer "a unique slate of programming."