Choosing between XM Radio and Sirius
Similar service but with some
differences
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Satellites transmit
high quality digital radio signals to your receiver,
wherever in the US you are.
Choose the radio and service that best suits you.
Part 2 of a 2 part series -
part one explains what
satellite radio is and discusses its many appealing
features. |
For most people, the issue is
not if you should buy a satellite radio, but rather, which
service should you join.
Satellite radio is so
compellingly good most people will be delighted at getting
service. You have two very similar services to choose
between.
Choosing the Best Service for
You
So you've decided to get
satellite radio? Bravo! Chances are you'll quickly
join the millions of us who already have and love satellite
radio service.
There are two parts to your
choice of service - you may wish to consider both the
differences between the two service providers - Sirius and XM
Radio, and you may also wish to consider the different choices
in radio receivers.
We'll talk about the
hardware - the receivers - first.
Receiver Choices
XM Radio and Sirius don't
make their own receivers. Instead, various manufacturers
such as Delphi, Pioneer, and Audiovox make receivers.
Sadly, receivers are not compatible
with both services. You need to choose an XM compatible
receiver if you'll be subscribing to XM Radio, and of course a
Sirius compatible receiver if you want Sirius service.
There's no reason why
receivers could not pick up both sets of signals, but there's
probably no commercial reason to make such a receiver.
Almost no-one would choose to subscribe to both services, and it
is unlikely that either radio service would actively cooperate
with receiver manufacturers.
Some car manufacturers have
a satellite receiver available with their cars, either included
as standard or offered as an option. Of course, if you accept
this option, you'll have to also accept the car manufacturer's
choice of service provider, which may or may not be the service
you'd choose yourself.
At present, our sense is
that Sirius have a wider range of receivers to choose from than
XM Radio, but this may change over time, and the differences in
receivers aren't major in any event.
When choosing a receiver,
there are several things to consider :
Look and feel
Obviously you want a unit
that you are attracted to, and one which you find easy to use,
especially if you want to use it while driving at the same time.
A display that is
sufficiently bright and easy to read is also an important
consideration. Displays with three or more lines are able
to show your more data at the same time (eg adding a stock or
sports ticker).
You want to choose a
receiver with a layout you can intuitively understand, and
buttons that are easy to find and push. You don't want to
take your eyes off the road while driving and hunt around a tiny
control console to find the button you need.
Unit Size
Although these units are
small, they still do take up an appreciable amount of dashboard
space, especially if they need extra space for a mounting
cradle.
Try and figure out where
you'll mount the unit. You'll agree the
smaller the unit, the easier it can be placed.
Display Size
We've just said that the
smaller the unit, the better. But, conflicting with this,
the larger the display, the easier it is to read what is shown
on the display, and the more information that can be displayed.
Try and choose a unit with a
large display - it is possible to get a small unit with a large
proportion of the panel used by the display as the best
compromise between overall size and display size.
One related issue - make
sure you can dim the display sufficiently for night driving.
Some units allow you to change the color of the display
lighting, and most units allow you to change the brightness and
contrast, but at least one popular model remains way too bright,
even on its dimmest setting, for night driving.
Multi-purpose
Is this receiver only going
to be used in one place (eg in your car) or will you want it to
be capable of being used in different settings? Some units
can be plugged/unplugged from different adapters, and so can be
used in the car (or in multiple cars), plus also in a boombox as
a portable unit, and even connected up to your home stereo as
well.
If you're wanting a receiver
that can be used as part of different music systems, make sure
the unit you are considering has this capability.
Inclusions
What does the unit come
with? Do you have to pay extra for an antenna? For a
car mounting kit? For other kits? For a cassette player adapter?
Be sure to cost out and
compare the total system you need, not just the simple receiver
unit by itself.
Special features
If you think you could make
use of, for example, a receiver's memory feature to store
programs while you're not in the car, be sure to get a unit with
adequate memory storage. This varies from a few minutes to
as much as five hours of capacity.
If there's some other
special need you have, make sure the unit you choose can handle
that, too.
Car Installation
How will the unit be
installed in your car? Will you do it yourself or get a
professional installer to do it for you?
If the latter, it can often
be preferable to buy the unit from the installer - that way if
there's a problem, it doesn't matter whether the problem is
related to the receiver or its installation, you still only need
to deal with one person to get it solved.
Receivers - Evolving Technology
Satellite radio receivers
are evolving at an appreciable rate. The best receiver
today will doubtless seem obsolete and underfeatured in a year's
time, and you may be tempted to upgrade for that reason.
This has two implications
for you.
Firstly, don't make your
receiver choice the dominating part of your decision as to which
service to choose, because when you come to upgrade, quite
possibly the other provider will have a better lineup of
receivers. Don't ignore this issue, but don't make it the
only issue you consider.
Secondly, while the Sirius
lifetime service plan - you pay a single flat fee of $499.99 and
get unlimited service on a single designated receiver as long as
you keep it - sounds appealing, you have to keep the receiver
for about four years to break even on this deal, compared to a
regular discounted monthly rate. If you're the sort of
person who replaces electronic gear regularly, then maybe this
isn't a good deal. But if you're able to confidently
predict you'll keep the radio you're buying today for five or
maybe even ten years, then this is a great deal.
Choosing between XM Radio and
Sirius for Service
Let's first of all talk
about what the two services have in common. Then we'll
look at each service individually for a more detailed look at
their distinctive points and differences.
Both offer over 60 channels
of advertising-free music, and a similar number of additional
channels with various types of entertainment, news, talk and
commentary shows, and traffic and weather reporting.
Both stations even offer
some identical channels (eg BBC World Service).
Both give excellent coverage
with very few signal 'dead areas' throughout the USA.
Both give good quality
stereo music, although XM Radio is perhaps slightly superior to
Sirius; although the difference is hard to detect with regular
music playing through a car stereo.
Both have similarly priced
receivers with similar features.
Both have similarly priced
monthly subscriptions.
Both have websites that can
stream most of their content to your computer, in addition to
your receiving it through your satellite receiver.
So, to sum up this part,
there's very little difference between the two services, and
whichever you choose, you'll almost surely be happy with.
A word of caution.
Programming lineups can change without warning, and if you're
making a decision based solely on one particular channel that is
on one service but not the other, be warned that the channel
could be discontinued at any time (this is happening to me at
present, with my favorite channel being discontinued
'temporarily').
Financial Strength
Both companies are
consistently and continuously losing money. A bit like an
airline, their business model is typified by very high
semi-fixed costs (satellites, programming, marketing, etc), but
extremely low variable costs per each extra subscriber.
Their challenge is to grow
their business to the point where the subscription income is
sufficient to cover their fixed costs. Neither company is
close to that at present, and the point at which it may occur
seems to be a bit of a moving - receding - target.
Sirius is losing more money
than XM. In the third quarter of 2005, Sirius lost $180
million and in the nine months through 30 Sept 2005, it lost
$552 million. If it continues its present rate of cash
burn, Sirius will need additional financing in the next six
months or so. It will probably secure the extra money it
needs with few problems, but both companies have to be feeling a
bit concerned that they have yet to reach break even -
especially XM with its over 5 million subscribers.
An earlier attempt by the
two companies to merge was rejected. It is possible this
issue may be revisited in the future. This need not
intrude on your choice of service now, however.
If the companies were to
merge, any prepayment you'd made for service would doubtless be
protected in large part, so you needn't be overly concerned at
prepaying your plan - I prepaid for three years of service just
a month ago, myself.
Distinctive features of XM Radio
XM Radio is the larger of
the two satellite radio companies, as measured both by
subscribers and by channels of programming, and was established
slightly earlier than Sirius.
At the end of September,
2005, they had over 5 million subscribers - twice as many as at
the end of September 2004.
Although they have over 5
million subscribers, they are consistently losing money each
quarter at present.
Satellite technology
They broadcast their
programming from high altitude geosynchronous satellites, and
supplement this coverage with over 100 ground stations that
provide 'fill in' coverage in areas of marginal satellite
service.
Driving around suburban
Seattle, sometimes I'd be in an area with perfect satellite
coverage but little or no ground coverage, and then a block or
two away there'd be no satellite coverage but excellent ground
coverage. Fortunately, the two sources seamlessly swapped
backwards and forwards, and with very few exceptions, the end
result for me was consistent high quality radio reception, free
of distortion or interference.
Fees
XM's fees are sometimes
slightly lower than Sirius. The month by month rate is
$12.95 a month, but if you choose to prepay for a year or more,
the equivalent monthly rate drops. The XM and Sirius rates
for monthly payments and one or two year prepays are identical.
But XM Radio also offers a
lower rate for three, four or five year prepays, working out to
$9.99/month for these longer terms.
There is no extra saving
when buying a four or five year service contract, in terms of
monthly rate, compared to the three year contract. The
only possible advantage might be if you think XM may increase
its monthly rate at some time - if this happens, you've locked
in the lower rate.
One would think that as the
subscription base for both XM Radio and Sirius grows, they might
choose to reduce their rates slightly to reflect their greater
economies of scale and presumably profitability. But,
rather rebutting that, while Sirius' rates have stayed fairly
steady, XM have increased their rates (up to the Sirius levels),
and it seems an even bet as to if rates will go up, down, or
stay unchanged over the next five years or more.
I'd probably choose to sign
a three year contract, but not a four or five year contract.
XM have a discounted rate of
$6.99 a month for up to four additional receivers on your
account.
Programming
XM Radio has 67 commercial
free music channels, and at least another 67 channels of sports,
news, and various other types of programming (they activate
channels for specific sports event coverage. They claim in
their promotional materials to have over 150 channels in total.
Distribution Partners
XM Radio can also be found
on JetBlue and AirTran flights, in some Hyatt hotels, as the
music feeds for DirecTV, and the music channels on AOL.
Receivers are also in some Avis rental cars.
Distinctive features of Sirius
Sirius has fewer subscribers
than XM Radio, but seems to be investing more heavily into its
content at present to grow its subscribers, with one result of
this being in September 05 it picked up a 56% share of new
subscriptions compared to 44% to XM Radio.
At the end of September,
Sirius had 2.2 million subscribers, up from 662,000 at the end
of Sept 2004. While the good news is their subscribers
more than trebled, the gap between Sirius and XM Radio actually
opened - XM added 2.5 million subscribers while Sirius added
'only' 1.55 million.
Sirius has slightly fewer
channels, and charges similar or slightly higher fees.
Like XM, Sirius is losing
money every quarter.
Satellite Technology
XM Radio uses a single
satellite, located in a fixed position above the US, to send its
programs down to earth. Sirius instead uses three
satellites that orbit around the planet, with each spending
about 16 hours of every day above the US. This means there
are always one and sometimes two or even three Sirius satellites
in the sky above you. Same as XM, Sirius also adds some
ground repeater stations to boost the signal in problematic
areas where its satellites can't get good signals.
Which is the better
approach? Based on user reports, it seems that both
methods work excellently, with no apparent difference in overall
quality and coverage.
While the difference in how
the two companies send their programming to your radio is
interesting, in practical terms it seems to not be an issue to
consider when choosing your preferred service provider.
Fees
Sirius charges a base rate
of $12.95 on a month by month basis, with discounts for one or
two year prepurchases (eg the monthly rate drops to $11.33 on a
two year prepurchase).
It also has a novel $499.99
plan which gets you unlimited future use for the life of your
radio. At a monthly rate of $11.33, this would represent
almost 3 years 9 months of service; if you kept the linked radio
for longer than this, you'd be starting to save money. But
with the rapid technological advances in satellite receivers, it
is quite likely you might want to get a new radio before you
started to actually save appreciably on this deal, so we
recommend you don't accept choose this option.
You can activate up to three
additional receivers on an account for $6.99 a month each.
Programming
Sirius has a similar mix of
music channels, with 65 different commercial-free channels to
choose from. In addition, it has 55 other channels
including sports, news, talk and other programming, with such
things as extensive NFL, NHL and NBA coverage, and coming soon,
shows featuring Martha Stewart and Howard Stern.
Sirius' sports programming
is probably better than found on XM, and Sirius is also betting
heavily that the addition of Howard Stern will greatly increase
its audience.
Distribution Partners
Sirius programming can be
found on satellite receivers inside some Hertz rental cars.
It also is featured on the DISH satellite service.
Which Should You Buy?
Notwithstanding the 2500+
words preceding this final paragraph, in the ultimate analysis,
there's very little to choose between the two services. If
you have specific interests or tastes, use the free web trial of
both services to get an exact understanding of the programming
provided and its respective suitability.
Otherwise, make your choice
based on the best deal you can find, and the equipment you want
to purchase.
If the choice of service is
unclear, there is however one thing that is very clear. Do
choose one or the other, because you're almost sure to love the
resulting experience.
Read more in Part 1
In
Part 1 we explain what Satellite
Radio is and why it is so good.
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Originally published
25 Nov 2005, last update
21 Jul 2020
You may freely reproduce or distribute this article for noncommercial purposes as long as you give credit to me as original writer.
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