Thursday, September 14, 2006

Howard Stern, Satellite Radio and the BIG PICTURE

September 14, 2006

It appears that there are those out there who are of the opinion that Howard Stern’s move to Sirius Satellite Radio has marginalized him as a celebrity….that somehow Howard Stern is now housed in a “private club” where only few people can see or hear him, and that he is no longer available to the masses.

Howard himself has addressed some of this on his radio show and points out, correctly so, that even there are many who are going to great lengths to try to make it appear that Howard Stern is no longer a factor to the public.

This could actually not be any further from the truth.

The fact is that satellite radio is growing at a pace that is faster than satellite television, cable television, and cell phones.

Yes, the immediate impact of a move to a start-up service such as satellite radio will initially translate to a smaller audience, but that audience grows as each day passes, and because satellite radio delivers its platform to the entire US, Canada, and globally via the internet, his star will shine brighter than it ever has before.

I can remember buying a DVD player when they first came out, and visiting Blockbuster Video. The DVD section took up about 5% of the shelf space in the store. I commented to the manager that it would not be long before the DVD’s took up 95% and VHS took up 5%. The managers respons……..”That’s not going to happen”.

Well, we all know what has transpired in just a few short years. In fact, video stores as a business are even becoming an endangered species with on-line video rentals from sources such as NetFlix.

Those that seem to think that Howard’s star is dimming are not “BIG PICTURE” people. They fail to comprehend what is happening all around them. They are still grasping at FM Radio’s business model, and failing to see what exactly satellite radio’s true potential is.

In days gone by, Howard Stern was available in 20 markets, and his potential radio audience was limited to the population in those markets. Whether his audience was passionate fans, or passive listeners, there was a limit to how big his audience could get. The only way to increase his reach was to add new markets. This is where the failure is in the “terrestrial radio” business model. The radio stations are LOCAL, but Howard is syndicated. Realistically, Howard would have better ratings in some markets, and worse ratings in others. A business decision had to be made in each and every market. This was true of any show. If the number of listeners in a market was not seen as big enough to warrant the expense of the show, then that Market did not get Howard Stern. This type of business model leaves out potential fans who would have been listeners, but can not be because of the market they are in.

Satellite Radio changes all of that. There is no need for satellite to worry about which markets any given show will be in. Satellite radio is in ALL of them. If a market only has 10 to 15 terrestrial stations, a decision has to be made. With satellite radio you can deliver ALL of the content that ANY demographic of listener would EVER want to here. This is the reason why satellite radio will grow. Those that see the “BIG PICTURE” understand what is happening. Those that see the “BIG PICTURE” understand that Howard Sterns star will now shine brighter than it ever has before.

For the crowd that feel that Howard Stern’s star is dimming…….You will be the people at the cocktail parties heard saying, “who would have thought that satellite radio would get so big” and the “BIG PICTURE” people will simply smile knowing that they understood this long ago.

So, are you a "BIG PICTURE" person, or somone wearing blinders?

9/14/2006 10:08:00 AM

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