Karmazin: Sirius Doing Fine, Price Increase Possible

Mel Karmazin

Despite SIRIUS SATELLITE RADIO's MONDAY announcement of a cut in its subscriber projections, CEO MEL KARMAZIN said at the CREDIT SUISSE media conference WEDNESDAY that he does not see the company's retail numbers as "a slowdown" and repeated his contention that 2006 will be the company's best year ever and the fourth quarter the company's second best quarter ever (after first quarter 2006).

KARMAZIN backed off slightly from previous comments about a possible merger with rival XM SATELLITE RADIO, saying that such a deal might not be "a slam dunk" with regulators. He also said that with the addition of NASCAR to NFL football and HOWARD STERN, "there is an opportunity to increase our pricing," adding that at some point, the industry may reach a point where receivers are free and monthly fees will increase. "If down the line free radios become common place, our costs are coming down to where it is absolutely possible," KARMAZIN said, but he noted that "the pricing point today is not stopping somebody from buying satellite radio."

XM Price Hikes Also Possible

Across town at the UBS media conference, XM CFO JOSEPH EUTENEUER echoed KARMAZIN's pricing comments, saying that his company "has plenty of flexibility" but that prices have been kept low "to continue to drive subscriber growth." Chairman GARY PARSONS noted that rates for multiple accounts have held steady and that a new rate increase may affect those plans first.

Cumulus: Not Interested In Clear Channel Spinoffs

At the CREDIT SUISSE conference, CUMULUS CEO LEW DICKEY stressed the need to reach out to small local advertisers who aren't presently buying radio, but noted that the industry needs to keep its pricing up because "selling inventory cheap isn't the answer." He also said that the company is not looking to buy any of CLEAR CHANNEL's spinoffs, noting that CUMULUS had sold some of the stations to CLEAR CHANNEL in the first place. 

Emmis: Us Neither

Also voicing disinterest in CLEAR CHANNEL's castoffs was EMMIS COMMUNICATIONS, with Chairman/CEO JEFF SMULYAN reiterating the company's concentration on major markets at the company's CREDIT SUISSE presentation. SMULYAN returned to one of his previous themes that while satellite radio and iPods have had "cachet," that the tide is turning and that "things are moving in the right direction" for radio.

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