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Liberty Media-controlled pay-radio operator Sirius-XM is sticking to its forecasts that by the end of 2017 there will be around 100 million vehicles potentially able to pick up Sirius-XM’s satellite signals.
By 2023 that number will be around 150 million. This is not to say that each of these vehicles will be paying for Sirius-XM, only that its signals can be received by the vast number of ‘pre-owned’ cars, trucks and RVs.
Sirius-XM CEO James Mayer explained his strategy. “Sirius-XM entered the first quarter of 2013 with nearly 52 million satellite equipped vehicles in operation, up from 42 million a year earlier. This means our satellite radios are installed in approximately 22 per cent of all registered vehicles on the road. Since our new car penetration rate is about two thirds the trend of growing vehicles in operation will just keep going for many years to come. By the end of 2017, we should have around 100 million satellite equipped vehicles on the road and in 10 years time we should see about 150 million. Within a few years, we expect more used cars to be sold with satellite radio than new cars. These stats highlight our easily addressable market opportunity and provide the corner stone of our growth. Last year we exceeded our goal of more than 1 million self-pay additions from the used car channel and this year we plan to hit an ambitious target of more than 1.5 million self-pay additions from used cars.”
CFO David Frear amplified the plan. “Aftermarket original owner and subsequent owner, where year-over-year growth was consistent with our expectations that we will add more than 1.5 million new subscribers from the subsequent [ie pre-owned] market this year.”
Mayer, speaking earlier this year at a media presentation, admitted that Sirius-XM is “never really going to know how many of the used cars turning over in a year have a satellite radio in them.” He said that about 30 per cent of all cars sold in the US are sold privately, consequently getting firm data on how many of those vehicles are subsequently reactivated is a challenge. Some people, said Frear, call the company to re-activate a subscription without the broadcaster knowing that the car had even been sold. “Over time,” he said, “as we can get confidence in the measurement of the numbers, we’ll probably talk more to [analysts] about subsequent owners.”