• by Paul Gough , January 8, 2004

Sirius may still be the No. 2 player in the nascent satellite radio marketplace, but it's definitely trying harder. As a result, the spunky digital radio provider had big growth in 2003 and is unveiling new technological enhancements that could accelerate its growth in the future.

During Wednesday's session of the tech-heavy annual Consumer Electronics Show in Las Vegas, Sirius announced it had grown 772 percent in the past 12 months, from 30,000 subscribers at the end of 2002 to 261,061 on Dec. 31. As expected, Sirius had its most serious growth during the holidays, to the tune of 100,000 subscribers in the fourth quarter alone.

The news caps a banner month for Sirius. Last month, Sirius snagged a deal with the National Football League to carry play-by-play of regular season games and audio from the NFL Network. And a flurry of releases during the day boosted news and commercial-free music programming and gave a hint of the future, including real-time traffic and weather information for its on-the-road subscribers and a partnership with Delphi to deliver in-car video.

"2003 was a breakthrough year for Sirius," said Joe Clayton, president and chief executive officer of Sirius. "We made remarkable progress in many areas, even adding to this growing marketing opportunity called satellite radio. The potential market remains huge and it's expanding every day." Clayton spoke during a news conference Wednesday at the CES.

While the bulk of satellite radio services had been centered on automotive users, during the past year Sirius showed that it was looking for subscribers in other places. Sirius now offers portable and boombox audio that allow subscribers to take programming and commercial-free music out of the car and into their homes, workplaces, the beach, or anywhere else they want to go.

On Wednesday, Sirius confirmed that it would go forward with plans to deliver streaming video to vehicles, using the existing, low-profile antenna and a deal with Delphi. While details remain sketchy, Sirius said it plans to offer multiple channels of video. It's a concept that Sirius first publicly discussed last year, when Clayton said in the MediaDailyNews (Aug. 7, 2003) that Sirius was being asked by automakers to offer in-car video.

Sirius said it was able to gain subscribers in part by a wider product line, offering more than just in-car satellite radio and having products on the shelves with major retailers in the holiday season. And to be sure, robust subscriber projections didn't hurt either Sirius or XM on Wall Street. Both companies' stock prices have risen in recent weeks, and Clayton pointed out that Sirius' stock was the fifth most actively traded stock on the Nasdaq. It also plans a new advertising campaign and promotion in February, which would also feature three months free with a new one-year subscriber.

"That makes the effective monthly fee of about $10," said Mary Pat Ryan, head of marketing at Sirius. The monthly subscription fee is normally about $12.95 a month.

Sirius will also begin offering a traffic- and weather-enhanced product that would provide localized information for drivers.