55 Million Satellite Radio Subscribers by 2010?

I saw this today and thought I should address it since I have beat up on Sirius and XM in the past. The article starts out with this startling figure but quickly comes back to a more realistic outlook.

Twenty-three percent of the online consumers Jupiter Research interviewed expressed interest in the service, but only a quarter of them presently have a satellite radio. XM leads the nascent market for nationwide pay radio, with more than double the number of subscribers at rival Sirius Satellite Radio.

I suppose you could take this a couple of ways. It could mean that they have a large untapped market to pursue. If only 23% of consumers are even interested at this point, there is a lot that they can do to increase the public's awareness of the products. Even better, if only 25% of those who are interested- about 6% of consumers- actually have their products, that means that there is a huge growth potential here.

You could also look at this way. If only 23% of consumers are interested and only 6% have purchased a technology that has been mainstream and heavily marketed for the last five years, then you may have a problem. That problem may be that people don't believe that your product has enough benefits to justify buying the equipment and paying an ongoing subscription fee. Partly this is because the alternative is free! Unlike broadcast television, broadcast radio reaches the majority of American homes free of noise and clutter. Oh yeah, and if you think you are going to convince people that your product is worth that investment, time is running short.

"The primary challenges for Sirius and XM are price and competition with other portable media players and music services, such as iPods and iTunes, respectively," David Schatsky, senior vice president of research at Jupiter Research.

Right... and guess what, it only gets worse once Apple drops the next generation of cellular capability into the iPod and it becomes 100% connected to iTunes. That means not just music purchases, but podcasts and internet radio streams. So, who needs that satellite radio?

Patrick bemoaned the crapulence of the sat radio business model last month.

Ad Supported Windows?

Yes kids, its bandwagon time at Microsoft again! Yup, you gotta love those guys in Redmond. Google's gotten Mr. Softee's panties in such a wad that they are actually talking about ad supported versions of Windows as well as some of their applications.

I'm sorry, I just really can't imagine an ad supported version of Windows being anything but garish and obnoxious. I'm really curious to see how you insert advertisements into someone's desktop environment in a way that isn't garrish and obnoxious. Yes, Google does useful non-annoying ads with their text ads, but those are on webpages. Where is Microsoft going to put its adverts? Are they just going to randomly pop up when you're digging through your My Documents folder? Or maybe when you are watching a DVD they can target you for a popcorn ad. If anything, an ad supported Windows might encourage people to buy the full version.

Microsoft is responding to a bleak outlook in the consumer software market, I get that. They look out and see that more and more no one wants to buy software, they just want to use it. Microsoft needs to face up to the fact that they do not make software that fits with the idea of "Just use it!" Otherwise who is going to be willing to download, install, and endure the advertisements to use software that doesn't make life as easy as Google's (or some other web app developer) competing tool?

Since I am on the soapbox today...

This is a great piece on why government will screw up the internet if they get too much control over the networks or, God forbid, are able to "enshrine broadband access as a right." Ugh.

Taxing Voice over IP

Congress is working on legislation that would impose taxes on IP Telephony and other broadband services. Isn't this just indicative of how our "leaders" just don't get it. They can't seem to wrap their minds around the idea that sound is just another type of data once it is digitized. It goes on the same pipe, over the same lines as any other data. Imposing a tax on voice data carried over the Internet is just not going to be possible in the long term. Sure, you can put a tax on the subscription that a customer pays for a VoIP service, but in the long run VoIP is not going to be a subscription service (in fact if you tax it enough, it will be a shorter term). It is going to be an application that runs over your broadband connection the same way that your web browser or iTunes does. Apple's iChat software has for quite a while allowed you to have an audio chat with another iChat user, so long as you have the bandwidth to accommodate it. Google's new talk application does the same thing. And how long before video conferencing becomes the popular way to have these sorts of real time conversations over the net?

And why are politician's so interested in taxing voice services on the interent? Because they get a tremendous amount of money from all those extra fees and taxes that appear on your local phone bill. They need that money to buy votes, and if local telephone service is going to go the way of the dodo they are going to have to replace that somehow. And of course VoIP, the thing that is going to take that money from them, seems like the best target.

Politician's pandering to their niche constituencies and trying to buy votes need to stay out of the way of that which they do not understand.