Sirius gets NASCAR contract in 07

[Cross Traffic]

Great idea guys, go with the service with fewer subscribers and higher fees. The Nascar XM station is good for the call in shows, but racing play by play doesn't do much for me.

By Franklin Paul

NEW YORK (Reuters) - Sirius Satellite Radio Inc. on Tuesday said it would broadcast NASCAR (news - web sites) racing starting in 2007, adding another pricey sports package to its roster, but said it would sell advertising on a channel devoted to the hugely popular auto racing circuit.

Under an exclusive five-year pact, Sirius will pay NASCAR (National Association for Stock Car Auto Racing) rights fees totaling $107.5 million, with the highest payments in the final years of the term.


NASCAR, which counts the Daytona 500 as its premier event, is currently broadcast on Sirius' larger rival, XM Satellite Radio Holdings Inc., under a deal set in 2000.


Asked on a media conference call to compare the value of this deal with the fees paid by XM, Brian France, chairman and chief executive of NASCAR said the new pact was worth "a lot more."


"We are disappointed that we were unable to reach an agreement on extending our arrangement with NASCAR beyond the 2006 season," said XM spokesman Chance Patterson. "Certainly this deal will fuel the ongoing debate about the cost of sports programing across all media."


Both XM and Sirius, money-losing companies not expected to turn a profit for several years, have signed expensive deals to broadcast professional sports. XM last year signed a $650 million deal to broadcast Major League Baseball, while Sirius will pay $230 million for National Football League games.


In January, Sirius extended its nonexclusive agreement with the National Basketball Association to broadcast pro basketball games.


Janco Partners analyst April Horace said the deal may split potential satellite radio customers into those who enjoy music and talk shows and those who make sports a priority.


"At the retail level, Sirius has a more robust sports package, and that, combined with Stern, could sway future consumers to Sirius," she said. "But then again, if they are not very sports-oriented it could sway them to XM."


Sirius lags behind XM in subscriber numbers but attracted widespread attention last year after it signed a deal with controversial radio show host Howard Stern and made media veteran Mel Karmazin its chief executive officer.


The deal will be a driver of subscriber growth and advertising revenue, according to Sirius, which provides subscription-based radio services for a monthly fee. Both companies are racing to add features that will spur subscribers to pay between $10 and $13 a month for the service.


Ironically, the addition of NASCAR and Stern gives Sirius a pair of brands that will attract advertising -- although both XM and Sirius tout that most of their programing is free of the frequent commercials found on traditional radio stations.


Shares of Sirius slipped 25 cents, or about 4.2 percent, to $5.61 in active trade on Tuesday afternoon.


Analysts said the stock was hurt by reports that a frequent guest on Stern's radio show has been subpoenaed by the U.S. Securities and Exchange Commission (news - web sites) in a probe of possible insider trading in Sirius Satellite Radio.


Karmazin on the call reiterated the company's view that the matter does not involves Sirius or any actions of its officers.

[MuchoBulls]

I thought the rumor was that Sirius and XM were going to merge long before 2007?

[BSmack]

I smell dot com style busts in the future. 650 million to broadcast baseball? 250 million for football games? Have these people heard of TELEVISION? 105 million for NASCAR might be the best deal of the bunch.

Good fucking luck.

[jackass007]

I'm experienced in this so I can add my 2 cents here, I had XM last year. I liked it, but in order to hear the stations, I had to be in the car or connect an antenna to a window. I didn't use it in the house much. They wanted extra money to listen to Opie/anthony, I didn't get that. Now for me it was pretty cool, because when I'm out in the shop, I live in such a rural area, nothing except Jesus channels come in. (kind of pathetic seeing I live 30 miles north of Albany,NY) So XM really hooked me up with the sports talk, and all the other shit crystal clear. But now with Sirius getting stern next year, and Nascar the year after that, and the fact I don't give a rats ass about baseball, I didn't renew XM. I just figured I watch the races every weekend, and paying 11 bucks a week so I can hear fox sports wasn't worth it. I'm gonna hold out for a merger, or when Howard arrives at sirius. BTW I have no Idea where Rome is on either of the satellites. Anyone know?