Sirius Boosts Forecast

NEW YORK Sirius Satellite Radio Tuesday raised its year-end subscriber forecast to 6.3 million, up 300,000 from its January projection and 100,000 from a forecast in May.

The guidance, made during the company’s second-quarter earnings conference call, stands in stark contrast to rival XM Satellite Radio, which last week cut its year-end subscriber forecast to 7.7-8.2 million, down from its earlier projection of 8.5 million.
XM last month placed the creative portion of its $50 million ad account, handled by Interpublic Group’s Mullen, into review [Adweek Online, July 21].

In Q2, Sirius added nearly 600,500 subscribers for a total of 4.6 million. Despite a steeper loss of $238 million, compared to $178 million a year ago, revenue tripled to more than $150 million. The company also raised its year-end revenue guidance to $615 million, from $600 million.

Sirius is confident it can meet its subscriber forecast in part due to the presence of shock-jock Howard Stern, who joined the satellite service after gaining his independence last year from CBS Radio. “This year we will have the best salesman on radio selling subscribers for us,” said Sirius CEO Mel Karmazin of Stern.

Although Sirius painted a positive picture, it sill faces problems with the Federal Communications Commission over emission standards for some of its receivers. The National Association of Broadcasters recently called for the FCC to recall the satellite receivers not in compliance, a move Karmazin characterized as “saber rattling.”