February 28, 2005 10:31 AM PST

XM hikes monthly fees

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Satellite radio companies court travelers

February 9, 2005
Monthly subscription fees for XM Satellite Radio will rise approximately 30 percent, to $12.95, as the company expands its basic service, XM said on Monday.

But existing subscribers can spare the hike if they are ready to pay up front.

Customers can lock in the current $9.99 monthly rate if they opt for a one-year prepaid plan before April 2. Deeper discounts are available with longer-lasting prepaid plans, the firm said.

Competitor Sirius Satellite charges $12.95 for its monthly service plan.

In addition to 150 commercial-free radio channels, the basic package will now include XM's Internet service, XM Radio Online, which offers more than 70 channels of music and talk programs, and was previously available for a monthly rate of $3.99. The basic plan will now also come with XM's High Voltage channel, which had previously cost $1.99 extra.

"XM's growth to date demonstrates that the potential for satellite radio is far greater than anyone anticipated," CEO Hugh Panero said in a statement. "This new pricing approach will help fund future technology development, enable us to offer more attractively priced radios and maintain our programming excellence. Together, these initiatives should result in XM exceeding its current target of 20 million customers by 2010."

XM, which is engaged in fierce competition with rival programmer Sirius, currently claims a subscriber base of 3.2 million.

In the just-concluded fourth quarter, XM posted a 150 percent year-on-year revenue growth to cross $83 million. This boost helped XM reduce its quarterly loss to $188.2 million in the fourth quarter of 2004.

4 comments

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Is this related to..
XM's launch of its 3rd satellite, XM-3 11 days ago?

Also, maybe they should be spending more of the money on royalties instead.

I had XM for a few months and they didn't play any mainstream music outside of the "top 40".

Just remixes of old busted stuff and no-name artists.

I have heard FM radio stations out of San Jose and NYC that put XM and Sirius to shame.

Also despite paying for service, they still play radio edit version of songs even though they are not under FCC regulation.

Why can't companies just do one thing and do it well anymore?
Posted by Dachi (790 comments )
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not related to
No it's not related to the new sat but may be related to baseball. Did you listen to the XM channels? There's plenty of channels that play all sorts of mainstream music as well as deeper stuff. There's also hit music that is uncensored on other channels. Some hit channels are censored which I'm glad for because of my kids.

<a class="jive-link-external" href="http://www.xm411.com/" target="_newWindow">http://www.xm411.com/</a>
Posted by (2 comments )
Link Flag
If you're not...
... paying for XM radio now, a rate increase is of little concern.
Posted by Earl Benser (4342 comments )
Reply Link Flag
until...
Until sat radio is as common as cable TV and then you may care more about the rates.

<a class="jive-link-external" href="http://www.xm411.com/" target="_newWindow">http://www.xm411.com/</a>
Posted by (2 comments )
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