XM Radio 2009 Annual Report Download - page 3

We also introduced the XM SkyDock, the first satellite
radio controlled by an iPod touch or iPhone. The XM
SkyDock allows subscribers to enjoy all of XM and the
complete “Best of SIRIUS” programming package on
iPod touch or iPhone anywhere they drive.
With a consumer market that is increasingly price
sensitive, we have multiple programming options
designed to fit every budget and the interests of every
listener. We have developed new entry-level satellite
radios and offer packages as varied as the popular
“Best of Both” and Family Friendly options.
Offering the “Best Radio on Radio”
We truly are changing the way people listen to radio. In
addition to the product advancements highlighted
above, we are continuing to retain and attract the best
talent and programming.
With more than 69 channels of commercial-free music,
live coverage of every major sport and the best in news,
talk and entertainment, our programming is largely
complete. Where opportunities to expand or improve
our programming arise, we will take them. In 2009, we
added Rosie O’Donnell and are pleased to have her
join the other iconic personalities and artists at SIRIUS
XM, including Howard Stern, Martha Stewart, Oprah
Winfrey and Barbara Walters, among others. More
recently, we added MSNBC to our programming. In
2009, we retained all of our major programming and
have done so in a manner that reflects the new eco-
nomic reality we are all operating in.
Attracting Premium Listeners
This fall an Arbitron study of satellite radio subscrib-
ers found our audience is larger than previously esti-
mated and scores much higher on key demographic
criteria compared to the general population and AM/
FM radio listeners.
Arbitron’s study showed that more than 35 million
total adult listeners tune in to SIRIUS XM, 32 million
of who are weekly listeners. Arbitron also found that,
in a typical day, SIRIUS XM listeners spend 2 hours
and 45 minutes in their vehicle, which is significant,
given that while they are in their cars, they spend 71%
of their time listening to SIRIUS XM compared with
17% of their time listening to AM/FM radio and 5% of
the time using mobile devices.
Further, the Arbitron study revealed SIRIUS XM lis-
teners indexed higher on key audience attributes —
education, income, and receptiveness:
—Highly-educated audience. 56% of SIRIUS XM
listeners graduated from college or have advanced
degrees compared with 24% of AM/FM radio lis-
teners and 25% of the general population.
—Affluent listener base. 24% of SIRIUS XM lis-
teners have household incomes of $150,000 or
more compared with 9% of AM/FM radio listeners
and 9% of the general population.
—Highly receptive to commercials. Of those who
indicated they were more likely to change the
channel when a commercial came on, in comparing
SIRIUS XM and AM/FM radio, SIRIUS XM lis-
teners are 61% more likely to stay with a commer-
cial on satellite radio than with those that air on
AM/FM radio stations.
Not only do we have the best radio on radio, we also
have the best listeners in radio.
Remaining Listed on NASDAQ
Last September, SIRIUS XM received notice from
NASDAQ that our stock had closed below $1.00 per
share for 30 consecutive days and was no longer in
compliance with the exchange’s listing requirements.
This is frustrating given that as of April 12, 2010,
SIRIUS XM’s equity capitalization exceeded $6 bil-
lion — an equity capitalization that is greater than
approximately 92% of the companies listed on The
NASDAQ Global Select Market.
There are many steps to the listing process. As I write,
NASDAQ has scheduled a hearing on April 29, 2010,
at which time we have an opportunity to request
continued listing on The NASDAQ Global Select
Market. NASDAQ will not take any further action
until the findings of the hearing are issued. We are
optimistic that the NASDAQ will grant us up to an
additional 180 days, or through September 13, 2010, to
comply with the NASDAQ bid price requirement.
Regardless of the hearing’s outcome, we are commit-
ted to remaining listed on The NASDAQ Global Select
Market. Last year, our stockholders granted the board
of directors the authority to implement a reverse stock
split through June 30, 2010. A reverse stock split
would bring us into compliance with the NASDAQ
bid price requirement.
We are seeking approval from our stockholders at our
upcoming annual meeting to revise and extend that
authority through June 30, 2011. The board would
only take this action if it determines a reverse stock
split is in the best interests of stockholders.
Moving Forward Poised for Success
The stock price remains a source of disappointment
and frustration that I share with my fellow