The Homa Files

When launched – almost a decade ago – satellite radio was going to revolutionize the radio airwaves … like DirecTV and cable did for TV.

While the subscriber base continues to inch up, new “adds” are being neutralized by high cancellation rates … only about half of new subscribers end up renewing their contracts.

Why?

It’s hard to compete against free … especially with a product that doesn’t have a killer app.

* * * * *

When satellite-radio customers are asked whether they will keep their subscriptions, they answer differently depending on whether they have sought out the service or received it free through radios already installed in new or leased cars.

66% of the people who buy radios to replace the non-sat radios in their current cars say they’ll keep the service when their current contract term expires

Only 40% of people who bought a car with a sat-radio already installed and who got a free promotional trial subscription – say that they will “absolutely keep” the service when the trial expires

Source: NYT, Staying in the Orbit of Satellite Radio,  April 21, 2008
http://www.nytimes.com/2008/04/21/technology/21drill.html?scp=21&sq=%22drilling%20down%22&st=Search

This entry was posted on July 20, 2010 at 6:11 am and is filed under Satellite Radio & TV. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.