Friday, September 08, 2006
Stiletto Pre-Orders
September 8, 2006
As reported in several locations, it appears that Sirius has requested that retailers stop accepting pre-orders for the upcoming Stiletto.
No official reason has been given, which now leads to speculation.
Theories include the FCC, the RIAA, and some as far off base as saying the device does not exist.
Lets tackle the easiest one first.
The Stiletto DOES EXIST. At this point many people have seen the unit and had some hands on experience with it.
FCC
This is a possible reason. With recent issues regarding FM modulators, you can be assured that the FCC is taking a closer look at everything that has anything to do with SDARS. However, it is also very likely that the FCC has had the Stiletto in their offices already.
RIAA
This is perhaps the most plausible explanation. As many are aware, sirius cut a deal with the RIAA regarding the S50. They agreed to pay a bounty on each device sold, and to cap the number of S50's manufactured.
XM tried to cut a similar deal, and even expressed that they offered more money, but the RIAA turned them down, and then sued them. While it is true (as far as we know) that XM offered more of a bounty, they also wanted capabilities that the RIAA was pretty well set against. The main issues revolve around shadow recording, and the ability to quickly access songs and artists, thereby creating a library of songs on short notice without having bought the songs.
For example, you can place an Inno in your home dock, and let it record all night. In the morning, you can then scroll through the songs that were recorded, and save a song without having listened to it. This is a feature that the RIAA did not want in these types of units. The S50 on the other hand will record the songs, but will not list them so that you can save them. Instead, you listen to your recorded content, and save the songs you want, and fast forward through the rest. This process is a little longer than with the Inno, but in the end, the result is basically the same. The consumer can save individual songs with either device.
Aside from the live function, the only real differences in capability between an Inno and an S50 is the shadow recording/segregation ability, the song seek, and the artist seek.
In our opinion, the current law supports XM Satellite Radio, but you never know what can happen in a court room.
This brings us to the Stiletto.
As you know, some details of capability have been vague. This is because Sirius is still in negotiations with the RIAA.......However.......Sirius is also playing a watching game to see how XM makes out with the litigation between XM and the RIAA. If XM wins, Sirius has no need to cut a deal with the RIAA.
Lets assume for a moment that the current deal on the table between Sirius and the RIAA is a $20 bounty per unit, and a manufacturing cap of 1,000,000 units. This would translate into $20,000,000 for the RIAA.
Do you take that deal? Perhaps, but the XM and RIAA litigation may get resolved shortly meaning you could walk away from that deal and save $20,000,000, and put all the features you want into the device. Of course, Sirius could always add those features later, and the RIAA is well aware of this. Thus, it is very likely that the RIAA may well be seeking a "guaranteed" deal. Do you take the deal now? Or do you play "wait and see" a bit longer?
At some point (likely VERY SOON) it boils down to a business decision.
It would be wonderful to have the Stiletto out next week, but more important than the Stiletto is making proper business decisions. There will be those with opinions on both sides of this issue, but at the end of the day, Sirius will make a call on how they are going to proceed, and they will make every effort to make the correct business decision.
The recent happenings, to some. Are indicative of negotiations getting down to the "brass tacks" phase. Personally, I hope to have a Stiletto in my hands by the end of the month, but only time will tell.
9/08/2006 10:15:00 PM
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