XM’s Silent Success

Posted on July 10, 2003

Good article on Slate today about how XM Satellite Radio has become the success story nobody’s talking about:

[T]he $10-a-month service, which first broadcast in October of 2001, broke the 500,000 subscriber mark in April and expects 1.24 million by year’s end. Compare that to TiVo, which currently stands at a hair over 700,000 users but projects only a million by December…

Lots of big-market technology journalists, with the notable exception of Fortune’s [Peter] Lewis, somehow missed the boat on XM’s potential. New Yorkers often commute via public transportation while San Franciscans enjoy the luxury of a relatively cluttered, varied FM dial. (Full disclosure: As an admitted Manhattan dweller, I’d never met an XM subscriber face-to-face before reporting this column.) To them — OK, to us — satellite radio initially seemed like an unnecessary frill, especially in the age when CD players are ubiquitous even in low-end cars. And, after all, it’s only commercial radio, a medium whose geek appeal rates just a notch above carrier pigeons.

But the growing homogenization of local radio, courtesy of behemoths like Clear Channel (which owns 3 percent of XM), and the FCC’s laissez-faire turn on regulation have made unhappy listeners willing to pay for a better product.

Indeed — just one channel of XM’s 100 offerings, XMU, introduces me to more good bands in a week than I’d previously have discovered in a year. If they keep the quality of the programming this high, $10 is a steal.