Howard Stern takes his mouth and money to satellite radio

October 07, 2004|By Tricia Bishop and Stephen Kiehl | Tricia Bishop and Stephen Kiehl,SUN STAFF

Shock jock Howard Stern, who has earned a living - and the wrath of the FCC - with his foul mouth and sexual humor, is taking his act from the commercial airwaves to satellite radio. There, the government won't be able to regulate what he says, but his listeners will have to pay to hear it.

In a deal announced yesterday, and valued at $500 million over five years, Stern will broadcast exclusively on Sirius Satellite Radio, which charges subscribers to listen to its 120 channels.

Off the public airwaves, Stern will be freed from regulation by the Federal Communications Commission, which has repeatedly found his show indecent and has fined radio stations for airing it.

"I'm done with this kind of radio," Stern said on the air yesterday in announcing his decision. He will begin work for Sirius in January 2006. "I'm done. I'm done. I'm getting a divorce."

The move might determine not only Stern's future but also that of radio. Sirius, which charges users $12.95 per month, has about 600,000 subscribers nationwide and expects millions more to follow Stern to its format. Satellite radio has so far had mixed results in convincing Americans that it's worth paying for. If anyone can change that, Sirius says, it's Stern.

"We certainly think it's a watershed event. He is probably the No. 1-recognized radio personality in the country today," said Sirius spokesman Jim Collins. "His coming over to Sirius will be a huge driver of growth in terms of subscribers, he has such a strong loyal fan base."

Sirius said it needs to persuade 1 million of Stern's 12 million listeners to subscribe for the deal to pay off.

Sirius' main competitor is Washington-based XM Satellite Radio, which played down the Stern deal yesterday by pointing out that it already has 2.5 million subscribers. Sirius and XM (launched in 2002 and 2001, respectively) require listeners to purchase a radio equipped to receive satellite signals - often for about $150 - and then pay a monthly subscription fee. Neither has yet turned a profit.

But in taking on Stern, Sirius appears to be banking on the business model that launched cable pay television: Sex sells.

XM has a radio version of the Playboy channel, for which subscribers pay an extra $2.99 per month for a blend of erotic fiction and reporting on the world of sex.

Some of Stern's fans say they will gladly pay to hear an uncensored, unbound version of their favorite shock jock. Stern's morning radio show (heard on 105.7 FM in Baltimore) airs in 46 markets; in many of them, it is the No. 1 show in the key 18-to-49-year-old male demographic. Fans said they expect it to get even better.

"It's gonna be pretty wild," said Hugo Guzman, a fan of Stern's in Miami who created the Free Howard Stern Web site in response to FCC actions against Stern. "I'm sure there's going to be stuff that will make even me say, `Oh, man, I can't listen to this!'"

Stern told listeners yesterday that they could expect rough language and in-studio sex, but Sirius' Collins said that might have been an overstatement.

Already, Stern's show is pretty wild. He has been known to talk women into undressing on air, and he discusses sexual acts in explicit detail. He popularized a remote-control flatulence machine that makes disgusting sounds at the press of a button from up to 100 yards away.

Displaced broadcasters

Satellite radio is increasingly becoming a haven for displaced broadcasters. Radio jocks Gregg "Opie" Hughes and Anthony Cumia of the Opie & Anthony Show launched an XM show Monday; they were fired from a New York station in August 2002 for broadcasting an account of a couple purportedly having sex in New York's St. Patrick's Cathedral as part of a contest.

Bob Edwards, unexpectedly demoted as anchor of National Public Radio's Morning Edition in March after 30 years with NPR, also launched a show Monday on XM.

"It's exciting, it's something new, it's the future," Edwards said in an interview yesterday. "I'm not part of this big news organization. I don't have all of these editors and producers and a lot of suits telling me how I should do a radio show."

The Stern deal confirmed Edwards' opinion that satellite was a good choice. "Howard Stern must see the potential, too," he said. "I think this is a good thing; a lot more people will know about satellite radio this afternoon and this evening than did this morning. And they'll say, `Hey, I've got to check this out.'"

This is what they'll find: a vast array of sports, talk, news and music. Also, since the signal is satellite-based, a subscriber can drive from coast to coast without changing the station.

As for investors, they reacted timidly to the news yesterday, driving Sirius shares up just 15 percent - 52 cents - to close at $3.87. Sirius stock prices over the past year have ranged from $1.84 to $4.20 per share.

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