XM Radio XM and Sirius are the sole operators granted a license to radio broadcast through satellite and the latter possessed better technologies and more financial resources (Godes and Ofek, 2004)
It is the same free, over-the-air broadcast radio that we've always known. Only better" (Ferency-Viars & Graves 2009, p
Few expressed surprise and many declared that the business model for premium radio was flawed from the beginning. "The idea of charging a "modest fee" in return for supposedly "superior programming and sterling reception quality" did not seem "viable" given the diversity of other radio stations and audio options that existed for listeners (Friedman 2009)
In 2005, Panero said: "It really is about just delivering quality content. And clearly, having 22 minutes of commercials on a local radio station -- mostly talk, very little music and not the music you want to hear in many cases because it can't be supported by the economic model of a radio station -- has basically drawn people to other alternative forms of getting content they want, whether it be satellite radio, whether it be, you know, iPod, whether it be the Internet, and we're just part of the revolution that's going on to satisfy the needs of people who want content when they want it in a very convenient way" (Smith 2005)
After suffering record losses, XM and its main competitor Sirius were forced to join forces in 2009. The merged company broadcast "more than 300 channels of programming, including exclusive radio broadcasts from shock-jock Howard Stern, television magnate Oprah and home-decorating guru Martha Stewart" (Sirius, XM merger, 2009, AFP)
Many thought that once the merger was approved by the Department of Justice, finally the fate of satellite radio would turn around. NYU professor Robert Solomon stated in January of 2008 that "the synergies are real and tangible," from merging Sirius and XM (Solomon 2008)
When people are struggling to pay for the basic necessities of life, such as food, shelter, and medical expenses, one of the first things they cut back on is entertainment, such as cable television, going to the movies -- and premium radio. In February of 2009, the radio behemoth Sirius XM declared that it had hired advisers to prepare for a possible bankruptcy filing (Sorkin & Kowue 2009)