Xm Satellite Radio Case Study

XM SATELLITE RADIO CASE STUDY

SUBJECT: XM Satellite Radio Case Study

BACKGROUNDXM’s vision is to provide audio entertainment through the use of a satellite-based digital :

to consumers throughout the continental United States. XM Radio is entering a traditional market with a new product concept. In order to accomplish this success, there needs to be a customer need to purchase this concept.

talk shows, music-oriented programs after morning rush, and on-air personalities, with almost 22 minutes of

made. BUSINESS MODEL: chased radio; thus enticing the purchase of the product. A strong penetration will go into making deals with the lead car radio producers, such as Visteon and Delphi Delco, which will put XM radio modes into most vehicles.

stations. After the trial period, they will still be able to use the XM mode on their radio, but the free stations will

will still have the ability to listen to high quality, always available radio. By including advertising, XM radio will be able to accommodate for free radio stations by covering the

taken from the total average of metro cume divided by the total annual ad revenues of all the major radio groups in the nation. If XM Radio can create a large enough demand on their free XM stations for advertising and talk

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PRODUCT: One of the biggest issues facing XM at the start is how does the company differentiate itself in the radio industry, both traditional and satellite? While differentiation in both industry components will be necessary, we suggested that the company focus on differentiating itself from its lone competitor in satellite radio, SIRIUS, than the current AM/FM competition. Based on the exhibit provided by Acker, SIRIUS is identical to XM Radio in the basic product sense: programming, audio quality, availability, and ubiquity. Also, SIRIUS had a head start on XM Radio in brand awareness,...