Sirius XM’s money troubles could mean radio silence for shock jock Howard Stern. The shock jock came to Sirius to offer uncensored programming that features many of the crazy and shocking broadcasts the shock jock has dazzled fans with for many years.
The satellite radio company could file for bankruptcy within days, according to the New York Times. Waiting in the wings? EchoStar, which has already taken on much of Sirius XM’s mounting debt. So, is satellite radio about to go silent?
I doubt that the service would go off the air overnight, but as the Times points out, the company might have to cut some of its pricier shows which could start with Howard Stern.
Another scenario: A takeover by EchoStar, the satellite TV company that’s circling Sirius XM like a vulture.
How did Sirius XM get into this mess? Chalk it up to a mountain of debt: $3.25 billion give or take, about $175 million of which the cash-strapped company owes this month.
As Bloomberg reports, Sirius XM turned down a takeover bid from EchoStar back in December; since then, EchoStar has been buying up chunks of Sirius XM’s debt.
Is Howard Stern days numbered?
If they do file for bankruptcy, EchoStar will be in a world of hurt, because they’ll have to bid for Sirius in bankruptcy court auction.
This possible bankruptcy filing is big news because threatening to declare bankruptcy puts big pressure on EchoStar to buy Sirius out *before* they go bankrupt, or to consider converting the existing debt they own from Sirius into majority ownership stock, and possibly all at a much higher price than the original offering. In the long run, it’s probably a lot less hassle than trying to buy the company at auction.
Either way, it’s bad news for Stern. On the other hand, he’s got die-hard enough fans, maybe he can setup an online show and charge subscription fees to get it like a video or audio podcast, maybe through iTunes or something. In this digital age, I’m sure he’ll survive just fine, if nothing else, on the tons of money he’s already made in his life.
Sirius should have sold in December that was their big mistake.
Howard,
Since you were so gracious to allow me an interview and your banters I expected. What I expect is you would not flee in disgrace if Sirius goes “belly up”! Come on Howard,this is me, Mario Lopez! I was suppose to be interviewing you. I would think and hope you and Beth make a sound decision and keep your current contract. I am sure your financial gurus spoke to you when Sirius started to nose dive. If you “jump the shark now” you are no better off than your competition was when they heard you coming to their city.Now you are global,via the internet,too,and you should stay on!Or what you gonna do,pay NASA,get them out of debt and you and your lovely wife Beth,and pet Bianca, be the first family to take residence in outer space? Come on Howard,you and your troupe stay put! In fact,one better,you have your tapes,I am surprised you haven’t done a sequel to your “Crucified by the FCC” and call one multiple disc set,”Resurrected by Satellite” and have all those bits including “History of Howard Stern,Parts 1 and 2″ in it as well. Just ideas Howard. But if you do,go with that,”Resurrection” idea. I want a cut! :)
Peace,
Mario
Mario,
Very nice post, but what Raging Tech said he will be somewhere.
Seems really coincidental that Howard is not on the air the week which the deadline of paying back the debt falls in. 2/17/09. I always thought the astronomical amount they paid him was ridiculous…but what now that most of that was stock? I hope all works out.
There may be light at the end of the tunnel. Read our post from today about Sirius.