With Dianne Feinstein re-creating the PERFORM act yesterday, we would like to talk more about it, including what we know so far, and who to contact to help defeat it in committee.

With the bill being released, we now know it is bill number S.256(Congressional Record). Feinstein gave a speech about it. Here is the summary of the bill:

-Royalties will be decided for satellite radio, internet radio, et al as a whole

-It will raise the cost of recordable receivers, by making the maker pay a ‘reproduction royalty’

-It won’t prevent the radios from recording prechosen timeslots, such as recording Fridays from 3-4p.

-Traditional Radio is not applicable to this bill.

Click for Analysis, quotes from Feinstein, and who you can contact and how to help this bill get defeated

Via FMQB

A bill has been introduced to Congress which would set new rules for satellite radio, creating new rates and content protection standards similar to those of Internet radio. The legislation was sponsored by Sens. Dianne Feinstein (D-CA), Lindsey Graham (R-SC), Joseph Biden (D-DE) and Lamar Alexander (R-TN).

The RIAA has hailed the bill, with Chairman/CEO Mitch Bainwol stating, “This early play by Sen. Feinstein and her colleagues should leave no doubt that policymakers continue to view parity among digital music services as a top priority. And a top priority it should be. Under the current system, satellite radio has been allowed to morph into a digital distribution service – shorting the creators of music, displacing licensed sales and threatening the integrity of the digital music marketplace in the process. We love satellite radio. But this is simply no way to do business. It’s in everyone’s best interest to ensure a marketplace where fair competition can thrive.”

Update: Senator Feinstein has a press release about it. They basically want to unify the rates for different mediums, including radio on cable, satellite, and internet, but they are not going to do it with terrestrial radio. Feinstein calls it “fair market value”, and wants the broadcast hard to ’steal’, which I find hard to do with Sirius already. It’s much easier to log onto Limewire and download a song in 160 or higher bit rate, than record a song on your S50 or Stiletto at less than half the bit rate and with fades, parts of liners, or DJs talking at the beginning and end.

Thanks KTMC!

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According to Orbitcast, theflyonthewall.com is saying that XM and Sirius are planning to announce a merger today at the North American International Auto Show. We’ve commented on why it wouldn’t work before, so I won’t rehash it. If it does happen, look to Backstage to report the details, and thoughts on the merger. Stay tuned.

I do wonder why they didn’t announce this Monday at CES, if it is happening.

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Notes from the Citigroup Conference Presentation by Sirius CEO Mel Karmazin:

-Mel does not like the lifetime subscriptions, because the people using it are probably Sirius’ biggest fans.
-Price hike is possible, but not happening at this time
-They hope to hit goal of 10% of revenue as advertising this year
-No more major deals to do, minor deals still out there though
-Portable device is not a mass-market future, in his opinion
-Deal with MP3 hardware company: maybe, thinking about the relationship, but then there is another company wanting a profit on the device, possibly driving up costs
-Sirius pays 2-3% royalties now to the RIAA, RIAA wants 10%+, Sirius thinks it is worth less than 1%. Music is a good foundation, but they have to add the other content in order to drive subs. Hope to have an agreement or court decision by the end of 2007.
-Agreement with the OEMs for a certain maximum number of ‘contact times’ when Sirius can contact the sub on a promo plan to become self-paying, done in order to receive the names and addresses of those that got Sirius in their car.
-They want to do movie times, price of gas around you, etc. in the future. It would require adding a GPS receiver to the car.
-Confirms that Sirius not FCF + on an operating basis yet, just on a total basis.

Thoughts:

-Making a deal with Creative or Sandisk right around now would be a great thing. While it might make the device cost a little more, such a radio would have greater marketshare than just going it alone, and would bring in greater penetration into retail.

-Lifetime may not bring Sirius more money in the long run, but it helps keep churn lower, albeit probably not by much. I’d say it is good to get OEM subscribers, and keep them.

-Movie times and such has been hinted before, and Sirius has done surveys asking as much. It would be an interesting feature, and possibly one of the best ideas in terms of bandwidth use per unit of revenue that they could want.

-Subscription hike probably happening, but only a $1 or two. Above $14.99, and it has a psychological effect. Probably larger hike for family plan members, to $9.99, but those are just my thoughts.

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The Alt-Country Show Y’Allternative, will air Fridays at 11pm ET starting January 12th. It will be hosted by Cameron “Buzz” Brainerd, who used to DJ on KZLA until 2005. KZLA, the last country station in LA, switched to a Rhythmic/CHR format in August 2006.

Catch an encore of the show Saturday Night/Sunday Morning at Midnight ET.

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As we mentioned Monday, Sirius DJ Dave ‘Mac’ McNamara passed away over the weekend due to cancer. Pat St. John has announced on his website that there will be a tribute to Dave Mac on Sirius this week. Listen to the Dave Mac Tribute Hour at the following times starting today:

The Spectrum - Channel 18
Wednesday, January 10th - 3pm (Eastern)
Thursday January 11th - 9am (Eastern)
Friday January 12th - Noon (Eastern)

Sirius Disorder - Channel 24
Wednesday, January 10th - 9pm (Eastern)
Thursday January 11th - 5pm (Eastern)
Friday January 12th - 2pm (Eastern)

Many of you have been wondering when Sirius.com would mention Dave’s passing, and they have on all three channels he DJed on: The Spectrum, Sirius Disorder, and Sirius Blues.

UPDATE 11:40am ET: Each of the channel pages above on sirius.com include the following tribute:

DAVE MAC 1963 – 2007

Long time SIRIUS host Dave McNamara (“Dave Mac”) passed away Saturday morning, succumbing to cancer. He was 43 years old.

For the better part of his life, Dave was a musician…playing in and producing a number of bands along the same New Jersey shore that gave rise to Bruce Springsteen. Dave Mac was also a lifelong fan and connoisseur of music of all varieties. A great host here at SIRIUS, and before SIRIUS, at various radio stations across the country.

Hopefully you were able to hear him on the Spectrum, SIRIUS Disorder, or SIRIUS Blues. He made SIRIUS a better place – and if you knew him, you know that his contributions were far greater than merely his on-air work. Dave Mac could evoke laughter, tears, and significant thought…all within the course of one radio show. Dave Mac was a great communicator…and also, perhaps above all else, a great interviewer.

If you were lucky enough to hear Dave’s conversations with some of the biggest stars in the history of rock music, then you were the beneficiary of some of the most frank and forthright discussions you could ever hope to eavesdrop on. From The Rolling Stones to John Mayer, Neil Young to Coldplay, The Who, B.B. King, Bob Seger, Pete Yorn, Keb Mo, Beth Orton, and so many others, Dave’s engaging nature brought out the absolute best in those he spoke with.

He is survived by his parents, Leon A. and Patricia D. McNamara, his fiancée Rita C. Truex and his brothers, Duncan McNamara of San Carlos, CA, and Malcolm McNamara. Viewing hours will be Thursday, January 11, from 6 to 8 pm, at the John E. Day funeral home, 85 Riverside Avenue, Red Bank, NJ. A memorial mass will be held on Friday, January 12, at 10:30 am at the Church of the Nativity, Fair Haven, NJ. Burial services will be private. In lieu of flowers, donations in Dave’s memory may be directed to the American Cancer Society.

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Orbitcast has a bajillion photos of the new Backseat TV unit. It is the SC-V1, distributed through Directed Electronics, and will be available in the spring for $299. It comes with what looks like a modified Starbase so you can listen to the radio in the front, and a large SiriusConnect tuner. A remote is available too, for the backseat.

Currently, Cartoon Network is up and running on the TVs, so they will be a likely content partner, and rumor is Nickelodeon will be too.

There are still many questions to be answered for this. Will it be a simulcast of the Cartoon Network/Nick feeds, or a custom one that does not include kid-unfriendly material like Nick at Nite or Adult Swim? How much more will video cost? Since it is a ‘multi-zone’ tuner, my guess is it will be two subscriptions for the audio and video, so $19.94/month.

Where is Sirius getting the bandwidth? This is probably going to be the primary use of HM, Hierarchical Modulation. The technology was unveiled in 2004, and it was supposed to increase Sirius’ bandwidth by 25%. It never materialized though. They could be providing this, and other future ancillary services, through HM because the technology is not backwards-compatible, which means that certain older radios would not be able to receive it. By doing it this way, there are no complaints as to why Joe Schmoe cannot recieve the same channels that his buddy is.

Looking at the future, could this ever move out of the backseat market to the portable? The S50 and Stiletto have full-color screens almost as big as the video iPod. It would not be hard to enlarge the screen to 2.5″ for the next generation, have 4-8GB of memory, and watch TV on the go, and/or have a built in DVR for recording it. My guess would be that one could store 20 hours of Sirius video on a 4 GB drive, if the player can compress it to a size that is smaller, yet good enough quality for a 2.5-3″ screen. If that was the new live wearable for this year, it would turn heads, plus add some more revenue to Sirius’ bottom line.

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The Wall Street Journal blog is reporting that out of the approximate 1000 products companies have nominated for awards, almost 400 won one. That gives you about a 40% chance of winning an award just for being at CES. This explains the plethora of awards both Satellite companies ‘win’ at CES every year. While there are some that can be justified, such as the Sirius Conductor or the XM Delphi Skyfi 3, others seem out of place, such as the XM Mini-Tuner, or the Sirius Connect, both of which were released and had working models at CES in 2006.

Remember when you want to purchase electronics later this year, that the CES innovation award does not necessarily mean it is leading edge.

Picture Credit: Orbitcast

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Well, it appears this may be the year where Sirius finally launches video. They first had live video presented in January 2003, and now there are lots of rumors going around.

Yesterday, Satellite Standard Group reported that the demo vehicle at CES with streaming video has Cartoon Network on it, and that people from Nickelodeon are at the Sirius booth.

This morning, a review of the 2008 Dodge Magnum came from The Car Connection. In it, they mention “New options include a hands-free Bluetooth system and iPod interface, Sirius satellite radio with streaming video…”

While we cannot confirm that video is happening, the possibilities are strong that it will.

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As an incentive payment, today Sirius issued Howard Stern 22,058,824 shares of common stock, due to greatly exceeding subscriber estimates for 2006. In October, 2004, the consensus estimate for analysts was approximately 3.5 million subscribers at the end of 2006. Sirius passed that by more than 2 million, the number needed to trigger shares being granted to Howard. Sirius ended the year with 6,024,000 subscribers. The value of the shares is approximately $83 million.

These payments could be expected to continue into 2007, provided Sirius does not see the slowdown that XM did in 2006.

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