Is Howard Stern Headed to Spotify? The Poaching Rumors Begin

Howard Stern

Photo Credit: Bill Norton / CC by 2.0

This morning, during an earnings call delivered alongside second-quarter performance information, SiriusXM CEO Jim Meyer once again expressed strong interest in inking a new contract with radio veteran Howard Stern. However, rumors suggest that leading music streaming service Spotify is making a play for the 66-year-old radio jock, whose current SiriusXM deal will expire at the end of this year.

Spotify CEO Daniel Ek fanned the rumor flames yesterday, during a conference call that accompanied the release of his own company’s Q2 2020 financials. When asked why he believes Spotify would be an optimal home for Stern, Ek identified the platform’s robust ad-targeting tools (including interactive “Streaming Ad Insertion” technology), global prominence, and overall scope. The Stockholm-based brand boasts nearly 300 million monthly active users (including about 138 million subscribers), compared to SiriusXM’s approximately 30.3 million self-pay subscribers.

At the time of this writing, Howard Stern hadn’t publicly commented on Daniel Ek’s statement, but given the high-stakes nature of the negotiations and the quickly approaching expiration of Stern’s SiriusXM contract, additional developments are undoubtedly on the way. SiriusXM, for its part, hasn’t shed light on the protracted talks’ specifics. But Meyer said today that he is “pretty sure” he’ll have an update to deliver during his company’s Q3 earnings call, which will take place in late October.

In a testament to the perceived potential of non-music audio entertainment, SiriusXM and Spotify have made sizable podcasting investments this year – SiriusXM with a $325 million acquisition of Stitcher and Spotify with a reportedly $100 million deal to become the exclusive home of The Joe Rogan Experience. Spotify also finalized exclusive agreements to host a criminal-justice podcast from Kim Kardashian West, a number of scripted programs from the DC Comics world, and The Michelle Obama Podcast.

As part of the aforementioned second-quarter earnings report, SiriusXM revealed that it managed to add about 264,000 self-pay users to its ranks despite the COVID-19 pandemic. Factoring for year-over-year growth, the satellite radio provider’s roughly 30.31 million self-pay subscribers (as of June 30th, 2020) reflect some 975,000 additional non-promotional listeners. Accounting for self-pay and paid-promotional listeners, SiriusXM closed the second quarter with about 34.25 million subscribers. Lastly, the New York City-headquartered company’s Q2 earnings of over $1.87 billion just missed Wall Street analysts’ expectations.

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On the streaming side of things, SiriusXM-owned Pandora gained 40,000 self-pay subscribers, representing a notably smaller increase than during Q2 2019. Like Spotify, the service experienced a considerable COVID-fueled drop in advert revenue, which fell 31 percent year over year, to $211 million. Similarly, MAUs decreased by more than five million from Q2 2019, including a sharp downward spike (to 46,000, 687,000 less than in Q2 2019) in paid promotional subscribers.

SiriusXM’s stock (traded as SIRI) is currently hovering around yesterday’s closing price of $5.91 per share.

2 Responses

  1. Avatar
    Al Jolson

    I thought he was run out of town for blackface?

    Oh…forgot…Trump hater so there is a different set of rules.

    Reply

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