Sirius XM Radio Inc., which reported 19.8 million customers at the end of the third quarter, told the Federal Communications Commission in a Jan. 20, 2011 filing that the FCC should not extend a price freeze negotiated as part of the 2008 merger that formed the company. Sirius wants to be free to raise its basic monthly subscription from $12.95.
However, Sirius, the New York-based satellite radio broadcaster created by Sirius Satellite Radio Inc.’s purchase of XM Satellite Radio Holdings Inc., did not say in the filing whether it wants to raise rates.
Sirius said in the FCC filing that the company and XM agreed to hold the basic subscription price unchanged for three years after the closing of their merger.
It asked the FCC to take “no steps” to extend or modify the rate cap. On Dec. 9, 2010, Sirius said it had reached an agreement with talk-show host Howard Stern to extend his contract by five years.
Stern is credited for adding about 2 million subscribers to Sirius since he moved from terrestrial radio in 2006, according to Tuna Amobi, an analyst at Standard & Poor’s in New York.
Sirius said it faces a “robustly competitive” market with consumers able to choose terrestrial radio and Internet music services like Rhapsody and Pandora, while carmakers like Ford Motor Co. and Toyota Motor Corp. offer ways to access Web-based entertainment in their cars. [via bloomberg]