Sirius has hooked the big one. In a bombshell announcement, the satellite radio broadcaster has inked syndicated "shock jock" Howard Stern to a five-year, multi-million-dollar deal beginning January 1
Sirius has hooked the big one. In a bombshell announcement, the satellite radio broadcaster has inked syndicated "shock jock" Howard Stern to a five-year, multi-million-dollar deal beginning January 1, 2006. An elated Joe Clayton, CEO of Sirius, calls the signing "without a doubt, the most exciting and transformational event in the history of radio."
Creatively shackled by stepped up FCC indecency enforcement and editing by current employer Infinity Broadcasting, Stern has been threatening to defect to the less restricted satellite radio medium for most of the year. The blockbuster Sirius deal makes that a reality.
It also has enormous implications for the more than 40 terrestrial stations that currently air his show, including Infinity powerhouses KLSX Los Angeles, WCKG Chicago, WYSP Philadelphia, KITS San Francisco, WBCN Boston, WJFK Washington, D.C. and Stern's WXRK New York flagship.
Specific terms of the deal weren't disclosed. However, Sirius pegs total production and operating costs for the Stern show at about $100 million per year.
"It has been my dream to have the top-rated show in radio since I was five years old," says Stern in a statement. "Sirius -- the future of radio -- will take this dream to a whole new level as I bring my fans my show my way. It will be the best radio they will ever hear."
Sirius had negotiated with exiled radio bad boys Opie & Anthony but lost out to competitor XM Satellite Radio. Roping Stern trumps that deal. Since entering syndication in 1986, Stern has had an indelible affect on morning radio and on radio syndication. He is the No. 1 national radio host among men 18-49 and ranks No. 1 in many of the 46 markets where his show is broadcast.
Stern's listeners are arguably the most loyal in radio and have migrated with the self-proclaimed "King of All Media" as he crossed over to other media, including books, pay-per-view, movies and television. Sirius is betting that his millions of fans will follow him once again and become Sirius subscribers.
Sirius estimates that Stern would need to generate approximately 1 million new subscribers in order to cover the costs of the deal. "When you look at his enormous existing fan base, all we need is for Howard to bring in a small fraction of his weekly audience for this agreement to pay for itself," says Clayton. "Anyone who knows Howard, and who understands how loyal his fan base is, will not have a hard time seeing the incredible potential for growth that he will represent for Sirius."
Sirius reached the 600,000-subscriber mark last month, and its service is also streamed to 10 million homes via a deal with satellite TV's DISH Network. Rival XM Satellite Radio has more than 2.1 million subscribers.
Sirius stock was up more than 15% in early trading today (Oct. 6) to $3.87. XM's stock was down almost 5% to $28.02.