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Pay Radio Demand Unclear

Pay Radio Demand Unclear

Satellite radio demand is hard to gauge, based on a recent survey by an audience analysis firm and what analysts say.
Seventy-four percent of listeners say they would follow Howard Stern when he goes to Sirius Satellite Radio in 2006. That’s according to a survey by Bridge Ratings, which surveyed those who identify Stern as their “favorite” morning show personality.
But when asked whether if they would definitely subscribe to the satellite service, that number drops to 22%, with undecided at 44% and 37% saying they would not subscribe, according to survey results.
Asked about the hardware and subscription costs associated with satellite radio, 7% said they would subscribe, with 49% undecided and 44% saying they would not follow Stern, states Bridge.
The audience analysis service surveyed slightly more than 1,850 listeners ages 12+ from November 2004 to January 2005.
Some analysts recently told Reuters that projections of satellite radio boosting subscribers as much as tenfold in the next five years may be overly optimistic. The projections are largely based on estimates of satellite radios installed in new cars in the next few years.
“Subscriber growth is the key and critical driver for satellite radio,” media analyst Frederick Moran of Stanford Group told Reuters. “Any snag in obtaining that growth could cause a sharp correction in the stocks of these companies.”
XM has recently said it expects to reach cash-flow break-even in 2006, yet analysts told Reuters profitability could still be several years away for both satcasters.