Get ready for two-way connectivity in the “connected car,” Sirius XM subscribers.
Speaking yesterday (Sept. 15) at the Bank of America/Merrill Lynch 2016 Media, Communications & Entertainment Conference, Sirius CEO James Meyer called the “connected car” an opportunity for the satellite radio company, noting that it will “build capabilities into the vehicles” including two-way connectivity.
He says such interactive possibilities are “going to have a profound effect both on our product and on the way we manage our subscriber lifecycles.”
That was just one of the key candid comments Meyer shared when queried by Bank of America/Merrill Lynch media analyst Jessica Reif Cohen.
What’s the biggest risk to growth at Sirius XM?
“To be candid with you, it’s keeping our customers happy,” CEO James Meyer said during a wide-ranging Q&A conducted yesterday (Sept 15) at the Bank of America/Merrill Lynch 2016 Media, Communications & Entertainment Conference.
“I ask myself every day, and I ask our team every day, what do we have to do to make sure customers pay us $16 a month — and then we need to do that,” Meyer says. “I am pleased that our churn has been very consistent for many, many, many quarters now, in this kind of 1.8% to 2% range. And, so while I don’t think it’s a risk to our growth going forward, it is the biggest area that could take our growth offline.”
What are the biggest growth opportunities for Sirius?
Responding to Cohen’s query, Meyer says that the “really exciting growth opportunity” is for Sirius XM’s embedded fleet, which he expects will double to 180 million overtime. With the new car market this year at 17 million vehicle sales, Meyer is eyeing the used car market.
“The used car market is almost 2.5 times bigger than that,” he says. “As we grow more and more of that second funnel which is second, third and even fourth owners over the vehicles’ life, we are getting addition chances to get new subscribers, and it’s driving a lot of our growth today.”
On the same day that Meyer spoke at the Bank of America/Merrill Lynch conference, SiriusXM and DriveTime Automotive Group, which operates 140 dealerships across the country with more than 145,000 cars sold annually, announced that its customers will now receive a three-month subscription to the SiriusXM “All Access” package when purchasing any pre-owned vehicle with a factory-installed satellite radio.
All-Access subscribers get access to SiriusXM programming via its smartphone and tablet app and online at siriusxm.com.
MOONVES: NO CBS-VIACOM REUNIFICATION
The Bank of America/Merrill Lynch investors conference also served as a platform Sept. 15 for CBS Chairman/CEO Les Moonves to proclaim that Black Rock is not in “active discussions” with Viacom about a recombination of the two media entities.
“We are never going to do something that is bad for the CBS shareholders or CBS employees,” Moonves declared at the conference during his own Q&A period.
Viacom split from CBS in 2005. While Moonves notes more assets are always a positive, “The truth of the matter is we’re a stand-alone public company. We’re happy with the hand we’re playing on our own with our own assets.”