This Week in Sirius XM Radio


Things never get dull for the country's lone satellite radio provider.

Shares of Sirius XM Radio moved lower this week, closing 0.6% lower to hit $3.08. The general market moved higher, so Sirius XM was bucking the positive trend.

There was more going on beyond the share price gyrations.

For the first time in two months, short interest in Sirius XM actually declined. On a programming note, Sirius XM enhanced its relationship with conservative talk show host Glenn Beck. In the world of streaming, Spotify rolled out its first television ads in this country.

Let's take a closer look.

Short people
Short interest peaked at the end of February, with more than 414 million shares borrowed to bet against the media giant. The sum had been growing with every bimonthly exchange update since early January, but fresh Nasdaq data shows that just 399.8 million shares were sold short as of March 15.

Sure, having nearly 400 million bearish wagers is a lot. There's no other company on a stateside exchange with more shares sold short.

Nokia is next on the list -- clocking in with 326.7 million shares sold short -- but is that fair?

The wireless phone company has struggled in recent years. It rattled off several quarterly deficits before finally posting a profit in its most recent report. However, revenue continues to slip at Nokia, and analysts see another year of top-line declines in 2013.

Sirius XM, on the other hand, hasn't had any major stumbles in recent years. The leader in premium radio continues to grow at a heady clip, and the scalable model is delivering even healthier growth in free cash flow and profitability.

It's refreshing to see the shorts scale back this time, but there's still plenty of ammo here for a short squeeze if Sirius XM comes out with good news.

Beck and call
Glenn Beck may be a polarizing figure, but the beauty of satellite radio is that there's plenty of spectrum to devote to all sides of the partisan debate.

On Monday, Sirius XM announced that TheBlaze -- Beck's multi-platform network for conservative news and opinion -- will produce hourly broadcasts that run on SiriusXM Patriot.

Sirius XM also rolled out TheBlaze Radio Network on its larger platform of Internet radio stations. According to the press release, the dedicated stations will feature exclusive talk shows from Jay Severin, Doc Thompson, and Buck Sexton, as well as The Glenn Beck Program, and The Pat & Stu Show.

This is a smart move for Sirius XM, and it doesn't matter where you stand politically. Launching the online-only station will prompt many of Sirius XM's right-leaning listeners to pay an extra $3.50 a month to add streaming to their existing receiver-based subscriptions. It may also lead to selling some stand-alone Internet radio subscriptions, though that's a harder sell at its stiff price.

Pandora does Windows
Sweden's Spotify is hoping to make a bigger stateside splash, and it turned to NBC's The Voice on Monday to introduce the country to its first television ad.

Reactions to the ad, featuring a guy crowd surfing at a concert in slow motion, have been mixed. The Spotify brand doesn't show up until the very end of the spot.

Spotify has 6 million paying monthly subscribers, and that's actually more premium accounts than rival Pandora has, even though Pandora has far more free active listeners.

If it serves to enlighten and educate music fans into the merits of premium radio, Sirius XM may stand to benefit from the campaign. Spotify's monthly rate for stand-alone streaming is more than the $10 a month that Spotify charges for its mobile-friendly package, but Sirius XM subscribers who already have a receiver pay a little more than a third of what Spotify is charging for on-demand content.

Advertising is important, and Sirius XM used to be a very active marketer on television during its defining days. Spotify is earmarking $10 million for this campaign, and now it just better hope that the artsy ad helps it win over more stateside fans before the dot-com giants make their inevitable push into this booming niche.

Despite Sirius XM being one of the market's biggest winners since bottoming out three years ago, there is still some healthy upside to be had if things go right for it -- and plenty of room for it to fall if things don't. Read all about Sirius in The Motley Fool's brand new premium report. To get started, just click here now.

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