chetta
01-28-2003, 10:13 AM
By Ed Garsten / The Detroit News
DETROIT -- The crystal clear music pounding out of a portable boom box, pulling in a signal from space, just may be the sound of resurrection for an industry that looked until recently as if it was crashing before it got off the ground.
The boom box is the latest in a line of SkyFi products by Troy automotive supplier Delphi Corp. aimed at making satellite radio more accessible beyond just cars and trucks and at relatively affordable prices.
The small portable SkyFi receiver can be docked or attached to car or home audio systems with separate adapters. Delphi expects to ship at least 80,000 of the boom boxes to retailers in the first six months of the year. The receiver will cost $129; the boom box will be $99.
"The boom box is high on the cool factor," said Jim Barry, spokesman for the Arlington, Va.-based Consumer Electronics Association. "In this kind of business -- in its infancy -- anything that's cool is a big help. When people see it and hear it, they say wow' like they did with high definition television."
Automakers are counting on the new uses to spark more interest in satellite radio.
"Once you get satellite radio you want to use it everywhere." said DaimlerChrysler AG telematics chief Jack Witherow. "The idea of portability of the products makes all the sense in the world."
Other manufacturers also plan to release similar "plug-and-play" units, adding to the availability of satellite radio.
Since its launch last fall, Delphi has sold about 100,000 SkyFi units, which receive programming from XM Satellite Radio, one of two satellite radio services vying for customers and survival. The other is Sirius Satellite Radio.
With 360,000 subscribers and predictions of a million users by the end of the year, XM is the leader. Each SkyFi sale means another subscriber, at $9.99 a month, for XM.
The company expects to reach 2 million subscribers -- a critical threshold that will allow it to break even financially -- some time in 2004, according to Chance Patterson, vice president of corporate affairs.
Sirius, which didn't begin broadcasting nationwide until July 2002, had about 30,000 subscribers at the end of 2002, but CEO Joseph Clayton expects that number to balloon to 300,000-400,000 by the end of the year and to a million in 2004.
But both XM and Sirius must overcome financial and technological obstacles that have dogged them since they were established in the 1990s.
New York City-based Sirius has lost $800 million since it started up in 1990 and must come up with new financing by June to remain viable.
The company's break-even point is about 2 million subscribers, according to Clayton.
XM, which has had a 1-year jump on Sirius, is in better financial shape, but not yet turning a profit.
Indeed, there is some debate as to whether satellite radio will survive, or quickly vanish.
"It's not a certainty satellite radio will be successful. XM might make it but Sirius may have trouble surviving," said Paul Hansen, who publishes the Portsmouth, N.H.-based Hansen Report on Automotive Electronics.
"We've learned a lesson from the past," said Sirius CEO Clayton. "Once a product like a consumer electronics product hits a million units, that's when the industry says it arrived."
Satellite radio's "arrival" may be hastened thanks to money and promises from several automakers.
General Motors Corp. and other investors are providing additional funding -- $475 million -- for XM.
The automaker will make XM receivers and service available on 44 of its 57 2004 models. The automaker began offering XM as a factory-installed option on 2002 Cadillac DeVilles and Sevilles and 25 other models for 2003.
Within three to four years GM intends to make the service available across its entire product line, according to Rick Lee, executive director of satellite service.
Honda Motor Co., Nissan Motor Co., Volkswagen AG and Audi all plan to put XM radios on future models.
Sirius is also on the receiving end of much needed financial help and exposure.
DaimlerChrysler AG has invested $100 million in the company and is making dealer-installed receivers available on several 2003 and 2004 models.
The Delphi-supplied receivers to be available are standard equipment on 2003 PT Dream Cruiser Series 2. They'll also be offered as factory-installed equipment on the 2004 300M and Chrysler Pacifica. Sirius units cost $299 with a $12.95 monthly subscription fee.
Ford Motor Co. has an exclusive agreement to offer Sirius on many of its domestic and foreign brands.
You can reach Ed Garsten at (313)223-3217 or egarsten@detnews.com
DETROIT -- The crystal clear music pounding out of a portable boom box, pulling in a signal from space, just may be the sound of resurrection for an industry that looked until recently as if it was crashing before it got off the ground.
The boom box is the latest in a line of SkyFi products by Troy automotive supplier Delphi Corp. aimed at making satellite radio more accessible beyond just cars and trucks and at relatively affordable prices.
The small portable SkyFi receiver can be docked or attached to car or home audio systems with separate adapters. Delphi expects to ship at least 80,000 of the boom boxes to retailers in the first six months of the year. The receiver will cost $129; the boom box will be $99.
"The boom box is high on the cool factor," said Jim Barry, spokesman for the Arlington, Va.-based Consumer Electronics Association. "In this kind of business -- in its infancy -- anything that's cool is a big help. When people see it and hear it, they say wow' like they did with high definition television."
Automakers are counting on the new uses to spark more interest in satellite radio.
"Once you get satellite radio you want to use it everywhere." said DaimlerChrysler AG telematics chief Jack Witherow. "The idea of portability of the products makes all the sense in the world."
Other manufacturers also plan to release similar "plug-and-play" units, adding to the availability of satellite radio.
Since its launch last fall, Delphi has sold about 100,000 SkyFi units, which receive programming from XM Satellite Radio, one of two satellite radio services vying for customers and survival. The other is Sirius Satellite Radio.
With 360,000 subscribers and predictions of a million users by the end of the year, XM is the leader. Each SkyFi sale means another subscriber, at $9.99 a month, for XM.
The company expects to reach 2 million subscribers -- a critical threshold that will allow it to break even financially -- some time in 2004, according to Chance Patterson, vice president of corporate affairs.
Sirius, which didn't begin broadcasting nationwide until July 2002, had about 30,000 subscribers at the end of 2002, but CEO Joseph Clayton expects that number to balloon to 300,000-400,000 by the end of the year and to a million in 2004.
But both XM and Sirius must overcome financial and technological obstacles that have dogged them since they were established in the 1990s.
New York City-based Sirius has lost $800 million since it started up in 1990 and must come up with new financing by June to remain viable.
The company's break-even point is about 2 million subscribers, according to Clayton.
XM, which has had a 1-year jump on Sirius, is in better financial shape, but not yet turning a profit.
Indeed, there is some debate as to whether satellite radio will survive, or quickly vanish.
"It's not a certainty satellite radio will be successful. XM might make it but Sirius may have trouble surviving," said Paul Hansen, who publishes the Portsmouth, N.H.-based Hansen Report on Automotive Electronics.
"We've learned a lesson from the past," said Sirius CEO Clayton. "Once a product like a consumer electronics product hits a million units, that's when the industry says it arrived."
Satellite radio's "arrival" may be hastened thanks to money and promises from several automakers.
General Motors Corp. and other investors are providing additional funding -- $475 million -- for XM.
The automaker will make XM receivers and service available on 44 of its 57 2004 models. The automaker began offering XM as a factory-installed option on 2002 Cadillac DeVilles and Sevilles and 25 other models for 2003.
Within three to four years GM intends to make the service available across its entire product line, according to Rick Lee, executive director of satellite service.
Honda Motor Co., Nissan Motor Co., Volkswagen AG and Audi all plan to put XM radios on future models.
Sirius is also on the receiving end of much needed financial help and exposure.
DaimlerChrysler AG has invested $100 million in the company and is making dealer-installed receivers available on several 2003 and 2004 models.
The Delphi-supplied receivers to be available are standard equipment on 2003 PT Dream Cruiser Series 2. They'll also be offered as factory-installed equipment on the 2004 300M and Chrysler Pacifica. Sirius units cost $299 with a $12.95 monthly subscription fee.
Ford Motor Co. has an exclusive agreement to offer Sirius on many of its domestic and foreign brands.
You can reach Ed Garsten at (313)223-3217 or egarsten@detnews.com