Washington — Marking a reversal in its sales and marketing structure, XM Satellite Radio is becoming a hardware supplier to at least one of its hardware partners.
XM said it will begin supplying dedicated XM tuners for Alpine head units and, through different third-party adapters, will also offer the tuners to other suppliers.
Stephen Witt, Alpine marketing VP, confirmed that Alpine will exit the XM FM modulator market, and no longer supply XM tuners to work with its own head units.
According to Dan Murphy, senior VP product marketing and distribution for XM, “Alpine and XM have agreed that it would be more advantageous for us to have XM introduce an XM branded tuner box that can work with Alpine’s head units as well as other company’s head units.” He said XM can achieve greater economies of scale by offering a tuner that can work with any brand.
Unlike the new XM Commander expected to ship this month, the new XM tuner will plug directly into a supplier’s head unit without the need for an FM modulator which tends to degrade the sound quality.
The new XM tuner will ship in the first quarter next year at a price “substantially below” the Alpine model, which sells in the $200 range (plus antenna), said Murphy. A distributor has not been announced.
XM said it expects to announce similar arrangements with one or two other suppliers and noted that the XM tuner can work with OEM radios.
XM also announced yesterday that it reached a subscriber total of over 929,000 and added more than 237,000 subscribers in the third quarter. The company says it is on track to reach 1.2 million subscribers by the end of the year.