Extends search engine's ads to select XM channels.

Google Inc. on Wednesday (Aug. 2) struck a deal with XM Satellite Radio Holdings Inc. to help the search engine's advertisers automatically insert ads on XM's nonmusic radio channels.

The deal would give Google advertisers a way to reach XM's subscriber base of more than 7 million people as they tune in to talk-based offerings such as Major League Baseball and an Oprah Winfrey channel.

It also could allow XM to increase revenue with new advertisers while lowering the costs related to processing ads, the two companies said.

Web search leader Google has been testing ways to apply its technology for selling Internet search listings to more traditional forms of media, from magazines to video.


Under the XM deal, Google's AdWords customers would be able to place terrestrial and satellite radio spots through the search engine's dMarc media network, the companies said.

Mountain View, California-based Google plans to integrate dMarc, which it bought early this year, into AdWords in the fourth quarter, it said.

Officials at Google and XM were not immediately available for comment.

The deal comes a week after Washington, D.C.-based XM cut its subscriber forecast for the year and said its quarterly net loss grew because of higher spending to attract new users.

XM expects to end the year with 7.7 million to 8.2 million subscribers, down from its earlier projection of 8.5 million. The company in January had said it hoped to get more than 9 million subscribers this year.

Advertising sales remain a small part of XM revenue, but represent one of its fastest growing income segments. In the second quarter, XM's ad revenue more than doubled to nearly $9 million.

Rival Sirius Satellite Radio, with programming that includes shock jock Howard Stern and the National Football League, ended the quarter with 4.7 million subscribers after taking some market share from XM.