SiriusXM 2.0 To Add Wi-Fi, Bluetooth


New York - SiriusXM 2.0 service due in the fourth quarter will leverage Wi-Fi, Bluetooth and the Internet to "create exciting complements" to the service's expanded channel lineup, said operations and sales president James Meyer.

As previously reported, the 2.0 service promises 25 percent more bandwidth to deliver more channels, which will initially be available only through two new aftermarket transportable radios due late this year.

Meyer also revealed, however, that by year's end, SiriusXM expects to announce 2.0 launch plans by at least one automaker. That automaker will offer 2.0 service in mid-2012 through a new satellite radio in a 2013-model-year vehicle, executives said. Discussions with that automaker began well over a year ago, said CEO Mel Karmazin.

The company didn't reveal the capabilities that Bluetooth and Wi-Fi would add to 2.0 service, but both wireless technologies could be used to communicate with SiriusXM servers through a user's cellphone or a vehicle's embedded telematics system to personalize the service in some way.

In a conference call with investors to report second-quarter financial results, SiriusXM executives also revealed that 2.0-compatible tuners would be software-upgradable to add new features without forcing consumers or automakers to replace hardware.

SiriusXM's Internet-delivered service to PCs and cellphones would be upgraded late this year to add pause, rewind and ability to time shift most channels up to five hours.

The Internet-delivered service would add on-demand music and talk early next year, the company said, and sometime in the first half it will add ability to personalize the company's curated content.

As previously announced, the 2.0 service's 25 percent increase in bandwidth will enable the company to deliver a major increase in Hispanic-oriented content, but the company also provided more details about the Hispanic content, which will include a mix of Spanish and English content, commercial-free music, plus news and sports. The additional Hispanic content will enable SiriusXM to deliver 50 percent more content than all the Spanish radio stations in Los Angeles, the company claimed.

The 2.0 service will also add new music and comedy channels. As previously announced, 2.0 will offer replay and time-shift functions, as some current satellite-radio tuners already offer.

In reporting its second-quarter financial results, SiriusXM posted a net profit for the quarter and first half on rising revenues and net-new subscriber additions. The first-half performance followed the company's first profitable year in 2010 since the 2008 merger between Sirius and XM.

For the quarter, the company posted respective revenue gains of 6.3 percent to $639.6 million, a record for any quarter in satellite-radio history, the company said. First-half revenues were up 6.8 percent to $1.26 billion.

Revenues could climb faster in 2012, given that Karmazin said the company would early next year price its service "as we see fit" now that the Federal Communications Commission has allowed rate caps, which were a merger condition, to expire.

Net profit surged to $173.3 million in the quarter from a year-ago $15.3 million, and in the half to $251.4 million from a year-ago $56.9 million.

The number of net new subscribers grew sequentially in the second quarter to 452,127 from the first quarter's 373,064, but was down from the year-ago quarter's 583,249.

For the half, nonetheless, the number of net subscriber additions was up from the year-ago half, hitting 825,211 from last year's 754,690.

The subscriber base hit a record 21.02 million at the end of the half, and the company raised its full-year forecast for net new subscribers to 1.6 million from a previously forecast 1.4 million. The company maintained its full-year revenue forecast of $3 billion.

The company attributed net subscriber gains to an increase in U.S. light-vehicle sales and increasing new-vehicle penetration.

In the future, Karmazin said, reactivating satellite radios in used cars will be "a very significant catalyst for growth." He pointed to car dealers' embrace of a GM program launched in April to give purchasers of used Chevy, Buick, GMV and Cadillac vehicles a three-month trial subscription.


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