• by January 3, 2001

As you know, the focus of this publication is online media. Increasingly, however, we are faced with the fact that all media is cosmically connected, so I thought you might appreciate a sneak peak at a new medium poised to shake up our landscape - subscription satellite radio.

Two companies -- Sirius Satellite Radio and XM Satellite Radio -- are launching pay satellite radio in the new year, aiming to give listeners hundreds of customized radio channels to choose from, better sound quality and, predictably, fewer commercials. All in return for a $9.95/month subscription fee.

Of course, traditional broadcasters argue that consumers won't pay for what they can get for free. But we know better than to say "never." These newcomers could do to radio what cable did to broadcast.

For starters, both Sirius and XM have already obtained licenses from the Federal Communications Commission to offer satellite radio. They've also partnered with news and content providers and have recruited famous names to anchor some of their shows.

Moreover, car makers are looking to build satellite radio receivers as a standard feature in their new high-end models and offer it as an option on less pricey cars in the next year. And eventually, retailers will sell home and portable units with satellite receivers too.

Add what's called Global Positioning System technology to the gadget and satellite radio could deliver traffic and weather reports tailored to a listener's location. That spells superior targetability to advertisers, but also has the potential to give local radio a real run for their money.

Analysts predict that traditional radio won't be displaced, but these new services could force AM and FM radio stations to reduce commercial loads and improve their programming to stay competitive.

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