I’m not the biggest Stern fan, but certainly the guy has earned an amazing amount of success in the radio biz.

Though not his first job in radio, Stern launched himself in a major way here in the Washington DC area. Unfortunately, after making a name for himself, he decided to capitalize on a horrible plane accident (”Hello? Air Florida? I was wondering if I could get a ticket to the 14th Street Bridge?”) to get himself fired so that he could sign a lucrative deal with NBC in New York City.

So, as I said, Stern brought himself to the pinnacle of radio dominance. And he did that by taking enormous risk and by using his talents to break new ground in radio. The term, “Shock Jock” was invented for Stern. I’m sure if you look the term up in the dictionary, his picture will sit right next to the definition. And, of course, Stern still rules the Shock Jock roost.

For me, however, there’s too much shock to appeal to my conservative nature. At the same time, the capitalist in me completely respects the success he’s earned.

And now Stern is poised to leap into a new radio frontier, satellite radio (or, as Don & Mike call it, “cable radio”). As an XM subscriber, and someone who spends 3+ hours per day on the road, satellite is a winner! Almost any kind of content you could want, on demand; it’s terrific.

While Don Geronimo took time to badmouth “cable radio” today, eventually, it will attract some of radio’s brightest talents the same way cable tv does. But not until after Stern teaches that industry an important lesson.

Or, it might be more accurate to say, not until after Stern teaches the satellite radio industry, in general, and Sirius, in particular, 500 million lessons!

Because that is what Sirius has agreed to pay Stern over the next 5 years… 500 MILLION DOLLARS! Wow!

Sirius cannot afford that kind of money, and I just don’t think Stern listeners are going to flock to Sirius in droves, pay the $12.95 monthly fee, then pay a rumored $10 per month fee on top of that to listen to Stern. As you know, that adds up to $22.95 per month! Will millions of Stern fans go out and pay $100.00 for satellite equipment, then $22.95 per month to listen to their favorite jock?

I have my doubts.

In the end, Stern is going to get his money. Win or lose, he’s golden. Even if the whole thing bombs, he’ll still walk away with HALF A BILLION dollars in five years.

Sirius, on the other hand, is the one taking the enormous risk. If it doesn’t work out, then XM may wind up purchasing Sirius in a couple of years at a bargain basement price.

Okay, I’m joking a bit here, but it truly is that big of a risk. It will be very interesting to see how this things work out.

David Flanagan
Viewpointjournal.com