Direc TV - XM Satellite hook up

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U.S. satellite broadcast heavyweights DirecTV and XM Satellite Radio inked a deal that will make 72 channels of XM programming available to DirecTV’s 14.6 million subscribers, beginning next month.

The deal, announced on Thursday, will greatly extend the exposure of XM, which recently passed the 5-million subscriber mark. The Washington, D.C.-based company is the larger of the two major U.S. satellite radio outlets, but it has been unable to stem the rush of red ink.

The company posted a second-quarter loss of $146.6 million, but that was down from $166.1 million in the same period last year.

The good news for the company was that its second-quarter sales of $125 million dwarfed its $53 million in revenue for the corresponding period last year.

Starting on November 15, DirecTV customers will be able to listen to some of the best of XM’s fare, including its High Voltage programming, which features former terrestrial radio stars Opie and Anthony, and Major League Baseball.

Expanding the Base

“This will give a larger subscriber base a chance to try XM content without going through the hassle of getting the necessary equipment,” said Nitin Gupta, an analyst with the Yankee Group. “If they find the programming valuable, it would be a lot easier to sign them up. The added distribution that XM will get from this relationship will be very beneficial.”

The deal seems to be well-timed for the lucrative holiday season. XM has said it expects to top 6 million subscribers by the end of 2005.

Sirius Satellite Radio, the New York City-based XM rival, has a similar deal with EchoStar Communications’ Dish Network.

The deal, announced more than a year ago, allows Dish Network cable TV customers access to Sirius radio programming. Sirius expects to top the 3 million subscriber mark by the end of 2005.

DirecTV customers subscribing to its Total Choice programming package will have access to 50 XM music channels and customers subscribing to the Total Choice Plus programming package and above, will have access to more than 65 channels.

DirecTV Para Todos customers will also have access to the same XM channels, as well as five additional Latin music channels.

“This also helps DirecTV,” said Mr. Gupta. “XM has established a pretty good brand out there, but XM certainly has more to gain out of this relationship.”

Source: RH

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