SiriusXM targets 185m vehicles
January 12, 2018
By Chris Forrester
David Frear, CFO and SEVP at pay-radio operator SiriusXM, says the business now has more than 100 million vehicles on the road, and is targeting 185 million within the next 8 years. “We’re just a cashflow machine,” he said.
SiriusXM had earlier reported that it added 1.56 million gross subs last year (net additions of 1.39 million), bringing its total audience to 32.7 million. Revenues were a record, at $5.7 billion with free cashflow of about $1.5 billion.
Speaking at the Citi 2018 Global TMT Conference on Jan 10th, Frear told delegates that it was planning to reallocate its satellite and repeater spectrum in order to have the flexibility to serve more audio from its cellular (terrestrial) transmitters and serve video and data over its satellite coverage. “For starters, you don’t have to carry channels twice and then you have this opportunity in connected vehicles to increase content delivery even further.”
SiriusXM last year invested in music streaming service Pandora.
Frear said that SiriusXM has a huge ability to gather data on how its subscribers use its services. “We just look at what the customers telling us. We’ve been following the influence of connected vehicles on [the] likelihood to subscribe to satellite radio for six years now. We started it in 2012. And we have been saying this for years. We cannot find any appreciable difference in likelihood to subscribe in a connected vehicle versus non-connected vehicle.”
He argued that some people would only ever want ‘free’ radio services transmitting in AM or FM. “We will never be a free service. We’re not trying to convert – we’re not trying to compete [with] free. We’re looking for people who are looking for a rich music, talk, news, sports and entertainment, traffic and weather, array of programming.”
Frear said: “There are over 200 million people listening to AM and FM radio. And we’re absolutely thrilled that we have over 27.5 million self-pay subscribers. But the important thing to note there is that we are far and away the smallest player in the market [when services such as Spotify, Pandora and cellular were included].”