Why Has Sirius Lost a Million Subscribers?

Sirius announced this week that it had hired as its chief product officer Joe Inzerillo, who had been chief technology officer of Disney’s streaming unit.

Inzerillo was the key leader behind Disney+, which has defied all odds in becoming a legitimate competitor to Netflix, a goal that’s thus far eluded Peacock, Paramount Plus, HBO and Hulu, all of which have content libraries arguably as deep as Disney’s.

Press play to hear a narrated version of this story, presented by AudioHopper.

The Wall Street Journal calls Inzerillo “an innovator in streaming” and that seems justified. He was chief technology officer at BAMTech LLC, the company that Major League Baseball started to deliver live sports, which it does better than any other app. That technology was later adapted by other streamers, such as WWE and HBO Now.

So Sirius is clearly hoping that some of Inzerillo’s magic will rub off. Sirius has several built-in advantages. Literally, built-in. It is installed in 8 of every 10 cars sold in the United States. Cars remain where Americans do the majority of their listening. Back when Sirius was at war with XM, and had signed Howard Stern to his first massive long-term deal, the news that it was the default choice for 80% of cars would have sent Sirius stock on an even higher moonshot than it enjoyed.

So what went wrong? Why are there almost 1 million fewer Sirius subscribers today (34.1 million) than there were in 2019 (34.9 million)?

Well, there’s nothing wrong with the programming. Sirius offers an almost unreal array of excellent music, news, entertainment and sports programming, much of it commercial-free. It’s an incredible value for a few bucks a month (Get 3 months free and $6/month for a year).

My theory, informed by my own personal interactions with music, news and entertainment, is that the world of audio cannot exist without a marketing and discovery strategy dominated by social media.

Let me explain by sharing my personal story over the past few years. There’s an Encino Man quality to my experience, because I abandoned music for 25 years and then returned to an entirely transformed marketplace.

My band The Lilacs had ceased playing together and putting out new music in 1993, when I moved from Chicago to New York and gave up music to become a journalist. I continued to follow the business closely, as an obsessed music fan and even wrote for Spin and Rolling Stone, and subscribed to Billboard, but you don’t care about it the same way when you don’t have skin in the game.

In 2017, The Lilacs reformed to play our first show in almost 25 years. It was a success, and we realized we had enough worthy unrecorded material to warrant making at least a demo for ourselves to enjoy. That demo, produced in Nashville by one of my rock heroes Richard Lloyd, turned out so good that Pravda Records put it out as The Lilacs Endure, a four song EP.

I thought maybe our friends would buy it. And because Pravda knows what it’s doing, our songs appropriately got up on Apple Music and Spotify and other services. I thought our friends would listen to it, plus whoever stumbled upon the band’s Twitter and Facebook, and that would be that.

And then a miracle happened.

Rodney Bingenheimer, one of the most influential DJs in the history of rock, is still cool as hell after introducing a shocking number of acts to KROQ’s listeners over the years, including Blondie, the Ramones, X, Nirvana, Sonic Youth and the Germs. Bingenheimer added “I Saw Her First” from The Lilacs Endure to the playlist on his Saturday show on SiriusXM’s Little Steven’s Underground Garage (Channel 21, and if it’s not already in your presets, you gotta add it immediately).

Hearing that song come through my speakers, played by one of my favorite DJs of all time, felt exactly like the scene in That Thing You Do where The Wonders and their friend run down the street in Erie, Pennsylvania as their song gets on the radio.

Naturally, I wanted to share this moment with everyone I knew. But that’s the problem. How does one share information like this? I couldn’t just tell my personal Facebook friends or ask The Lilacs’ social media guy (and former bass player!) Bob Michelson to ask the band’s Twitter followers to listen to the radio 24/7 in the hopes that Rodney would play The Lilacs again. We had no idea when he would play the song again, if ever. We had no idea if it had a chance of getting played on the other amazing channels of Sirius. Again, I love Sirius so much that the 30 or so presets on my car aren’t enough for all of the channels I regularly tune in. But even with the “notify” feature, it only works if you’re using the radio at that exact moment.

The problem is that the service is just not set up for the kind of sharing instinct people today regularly deploy. Once that song got on Sirius, I was ready to spend real marketing dollars to promote it. I was so grateful to Sirius I would’ve been happy to direct those dollars there. But how? Instead, strangers who stumbled upon the song via Rodney’s show started approaching the band. They offered to help. Some guy named James Woodell, who had developed some expertise in establishing The Dollyrots as a viral sensation, got in touch and told me it didn’t look like The Lilacs knew what we were doing in terms of Spotify and Apple Music. Of course we didn’t. We’re all 50+ year olds with real jobs who don’t know shit about how the music world works anymore.

Just a few weeks of promoting our music to his small network, Woodell helped get thousands of plays for our song. Surely the several more times that Rodney Bingenheimer played “I Saw Her First” on his show helped. But that’s my point. When Rodney plays our song, the listeners who like it rush to Spotify or Apple Music to engage with the song. It does little to deepen the relationship with Sirius, which was the avenue by which they first discovered it. Random people would find us on Facebook (no easy feat since a bunch of cutie pies from northern England have also named themselves The Lilacs, and are pretty good) and ask how they could hear our song, which they had first heard on Sirius. I felt torn because I wanted to encourage them to interact more with Sirius, obviously a great discovery engine. But the only real place our Facebook guy could send them was to Spotify or Apple Music.

So you see the problem. Sirius is a top-down competitor — and a great one, which has basically eliminated its lesser competitors. But we are in a world of user-generated content. Once our song started to hit, we had no real place to send anybody on Sirius. I would’ve done so in a heartbeat. I’m forever grateful to Sirius and to Rodney Bingenheimer and to Little Steven for fulfilling an aging rocker’s make-a-wish of hearing my song come through the radio. Each quarter, I get a check for a few dollars from the people who continue to play the song on the airline package Sirius offers to JetBlue and United. It’s been an incredible thrill during dark times.

So as Joe Inzerillo takes the helm of new products at Sirius, my business suggestion for him is to allow the most formidable marketing force ever put to use – meaning Facebook, TikTok, Twitter, etc. – to work for its top-down service. The channels benefit from the curation of real experts. Little Steven, for just one example, has assembled an all-star team of great DJs, who every single week surface music I never would’ve found otherwise.

But there has to be some engine for the marketplace to speak. Otherwise Sirius will end up in the exact same grave it dug for the horrible 22-minutes-of-commercials-per-hour stations that it replaced.

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Ken Kurson

Ken Kurson is the founder of the Globe suite of sites. He is also the founder of Green Magazine and greenmagazine.com and covered finance for Esquire magazine for almost 20 years. Ken is the author of several books, including the New York Times No. 1 bestseller Leadership.

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