The Satellites Behind Subscription Listening
By Brian Fauteux, author of Music in Orbit: Satellite Radio in the Streaming Space Age
Included in the glovebox of my 2013 Chevrolet Cruze is a safety-yellow envelope that includes a quick-start guide with instructions on how to use XM Radio during a 90-day complimentary trial. Six individual caricatures of imagined listeners decorate its front cover: a relatively nondescript middle-aged man, a composer, a sports fan, a NASCAR fan, a hip hop artist, and a heavy metal guitarist. Inside the booklet are instructions for operating the radio service but, more importantly, so too are convincing accolades about the act of listening to XM Radio: “XM is a truly unique listening experience;” “driving will never be the same;” “Just coast to coast coverage of digital sound, all the time. It’s like having your own personal digital music player, but without spending hours (or dollars) downloading.”
The guide’s NASCAR fan represents a marketing and programming partnership between the motor sport company and XM Radio. But why partner with NASCAR to be the home of radio broadcasts of races and related coverage? The answer lies in the need to acquire subscribers, regular and reliable sources of income who must be convinced of the value and worth of their ongoing subscription dollars. The growth and sustainability of satellite radio was dependent on subscribers, who would be courted, in part, by a balance between niche and mainstream channels.
In 2003, subscription revenue comprised over 85 percent of XM’s total revenues and in 2011, the merged SiriusXM generated 98 percent of revenue from subscriptions. Upon launching their new services, Sirius and XM would need to convert radio listeners to radio subscribers and convince them that radio was worth paying for. These music radio services have relied heavily on subscriptions, well before the turn to, and widespread use of, subscription streaming music services like Spotify.
In their respective paths of development, Sirius and XM established their services in spaces that, in opposition to the wide accessibility of FM and AM radio, were exclusive and restricted to middle-to-upper class listeners. Sirius and XM sought subscribers who listened in the automobile, the airplane, as well as in luxury hotels and coffee shops (including a partnership with Starbucks coffee shops). In other words, a particular class of subscriber-listener was targeted by the companies.
The pursuit of premium listeners, or subscribers, calls attention to the function of the technology of the satellite. The photo imaging capabilities and military and surveillance uses of satellites apply to the ways that the satellite companies target listeners, or isolate listener profiles of listeners for the sake of crafting niche programming. After the September 11 attacks in the United States, and also around the time of Sirius and XM launching, the global war on terror meant that media technologies, including satellite images, were tuned to issues of global security. The satellite becomes a key component of the pursuit of information and of endless surveillance at the expense of personal privacy.
The wider context of the Gulf Wars and war on terror is inescapable when thinking of the role and purpose of satellites in the 2000s. Even though the focus here is on music and radio, the satellite is a technology that targets. As subscribers become essential to the function and operation of satellite radio services, the target implies a relationship between what the satellite can accomplish and who the satellite radio listener is or will be, a zooming in on the ideal consumer for the subscription radio product.
In the early years of Sirius and XM, the ideal subscriber was one intrigued by new technologies and with the purchasing power to cover a monthly subscription fee (and an automobile equipped with satellite radio). This subscriber typically imagines their taste in music as not being served by regular commercial radio fare.
As XM proudly boasted in its annual report in 2002, the company “creates fans—not just listeners. Our world-class programming team and programming partners are indeed all about treating music listeners like music lovers…because loving music is what satellite radio is all about.” XM explained, via Billboard in 2000, that its audience is younger and more educated than network radio listeners. In 2003, executive VP of marketing for Sirius, Mary Pat Ryan, said that Sirius’s audience “is people who buy 20 or more CDs a year, go to concerts and subscribe to music magazines.”
Satellite radio requires subscribers to operate. Its music programming helps turn listeners into subscribers but programming and content costs are significant. To entice subscribers, Sirius and XM have used a wide range of music channels and big name celebrities to host channels and to promote a sense of exceptionality with respect to what satellite radio could offer listeners. Today, exclusive music and celebrity branded channels or stations are strategic ways that media companies acquire subscribers. And we all subscribe to many things, likely too many things. We can learn a lot from the story of satellite radio as it’s a story that predicted the cultural, musical and technological shifts that now define our times.