iHeartMedia + SiriusXM merger | Matt Connarton Unleashed

0:00 Speaker 1: iHeartMedia and Serious XM possibly merging. This is a big deal.

0:07 Speaker 1: You know. We've seen in the radio industry so much

0:10 Speaker 1: consolidation over the past twenty twenty five years, and it

0:14 Speaker 1: looks like there's about to be even more of it.

0:16 Speaker 1: If you're not familiar with Serious XM, of course, I

0:19 Speaker 1: mean they had merged. There used to be at one

0:21 Speaker 1: time there were two satellite radio companies, Serious and XM.

0:25 Speaker 1: Serious Satellite Radio and XM, and then they merged and

0:28 Speaker 1: became Serious XM. And now iHeartMedia, which used to be

0:34 Speaker 1: what did they used to be starts with a C

0:37 Speaker 1: clear channel, took me a second clear channel, ended up

0:40 Speaker 1: becoming iHeartMedia. They're the biggest largest owner of radio stations

0:46 Speaker 1: across the United States, so they're a big deal. They

0:48 Speaker 1: also have a podcasting platform. But iHeartMedia is in talks

0:53 Speaker 1: to be acquired by Serious XM holdings. I'm surprised it's

0:57 Speaker 1: not the other way around. But let's take a look

0:59 Speaker 1: at this. You know, sirius, they've been in a lot

1:01 Speaker 1: of financial trouble for a long time because the thing

1:05 Speaker 1: about satellite radio and what was it about, you know,

1:10 Speaker 1: early two thousands when when it became a thing. The

1:14 Speaker 1: thing about satellite radio is great idea. You know, you've

1:18 Speaker 1: got you've got a satellite radio transponder in your car,

1:22 Speaker 1: and then you've got all these different channels you can

1:24 Speaker 1: listen to. And of course the big draw for serious

1:27 Speaker 1: XM is Howard Stern, the biggest draw, or at least was.

1:29 Speaker 1: I don't know if he still is, but but he

1:32 Speaker 1: he very well maybe, And uh, so you could listen

1:36 Speaker 1: to all this stuff uncensored because it's satellite, so it's

1:38 Speaker 1: not not controlled by the FCC in terms of regulating

1:42 Speaker 1: what you can say and can't say and the music

1:45 Speaker 1: that you play, and in terms of profanity and so forth.

1:48 Speaker 1: So it's completely uncensored and uh, commercial free, or at

1:53 Speaker 1: least when it launched. That's not the case anymore. But

1:57 Speaker 1: but you know it was, uh, I don't know where

2:00 Speaker 1: that tone came from or if that showed up on

2:02 Speaker 1: the recording that deeming anyway, somewhere on this computer, something's

2:06 Speaker 1: making a noise, but regardless. So the problem though that

2:11 Speaker 1: satellite radio ended up running into that I guess nobody

2:14 Speaker 1: saw coming was the rise of streaming and podcasting. So

2:19 Speaker 1: the Internet is kind of I think for especially for

2:22 Speaker 1: younger and younger generations who are listening to terrestrial radio

2:27 Speaker 1: much less and less and are listening to streaming streaming platforms,

2:32 Speaker 1: are watching streams and podcasts and so forth. That's why

2:35 Speaker 1: everything that we do, you know, the shows that we

2:37 Speaker 1: do here at WM and H. Of course, just like

2:39 Speaker 1: every other radio station, they also are podcasts there. They're

2:43 Speaker 1: streaming live as we do them. You know, you're not

2:46 Speaker 1: just listening into your car. Obviously, we have listeners all

2:49 Speaker 1: over the world because they stream the show and then

2:52 Speaker 1: after I get off the air today, I will upload

2:55 Speaker 1: the podcast. Then it becomes a podcast and you can

2:57 Speaker 1: stream the podcast on demand, you can download it whatever,

3:00 Speaker 1: so you can watch it online on social media. So

3:04 Speaker 1: you know, so the radio industry has had to adapt

3:06 Speaker 1: in that way. But it kind of the rise of

3:10 Speaker 1: streaming and podcasting really took a big bite out of

3:13 Speaker 1: the whole appeal and the whole point of satellite radio,

3:17 Speaker 1: right because now everyone streams in their cars. So here's

3:24 Speaker 1: what's happening right now. And I'm almost surprised that nothing

3:28 Speaker 1: like this has happened or been talked about sooner, at

3:30 Speaker 1: least that I'm aware of. But it says here and

3:33 Speaker 1: this is from Music Businessworldwide dot com, which again is

3:36 Speaker 1: a great site. I read an article from it earlier

3:40 Speaker 1: in the show Great Side for Music Industry News. It

3:41 Speaker 1: says iHeartMedia is reportedly in preliminary talks to be acquired

3:46 Speaker 1: by Serious XM Holdings in a deal that would bring

3:50 Speaker 1: together two audio giants under pressure from on demand streaming platforms.

3:55 Speaker 1: And again that's what I was talking about. On demand

3:57 Speaker 1: streaming has really just taken a huge bite. Obviously it's

4:01 Speaker 1: affected radio terrestrial radio AM and FM radio, but it's

4:05 Speaker 1: also had a huge effect on satellite radio. This is

4:09 Speaker 1: according to Bloomberg, which reported over the weekend, citing people

4:13 Speaker 1: familiar with the discussions, that the talks are still at

4:15 Speaker 1: an early stage and may not result in a deal.

4:18 Speaker 1: Representatives for both companies decline to comment to Bloomberg. Music

4:23 Speaker 1: executive Irving Azoff has been working with Apollo Globe Management

4:28 Speaker 1: on proposals to merge the two companies. The report said

4:31 Speaker 1: a combined entity would generate more than twelve billion dollars

4:35 Speaker 1: in annual revenue. According to Bloomberg on Tuesday, April twenty eight,

4:39 Speaker 1: iHeartMedia shares rose I don't want to get into the numbers.

4:43 Speaker 1: I'm gonna skip down a little bit. iHeartMedia operates more

4:47 Speaker 1: than eight hundred and sixty radio stations across one hundred

4:50 Speaker 1: and sixty markets. That's how big. Again, it used to

4:53 Speaker 1: be Clear Channel. Clear Channel used to be at the

4:55 Speaker 1: giant that it became iHeartMedia. I don't remember how it

4:58 Speaker 1: became iHeartMedia. I don't remember member if there was a

5:00 Speaker 1: merger and they needed a new I don't remember the

5:03 Speaker 1: details of that. But it just used to be Clear Channel,

5:06 Speaker 1: if that makes sense. But again, they operate eight hundred

5:10 Speaker 1: and sixty radio stations across one hundred and sixty markets

5:14 Speaker 1: across the country, while SERIOUSXM, which operates a satellite radio

5:18 Speaker 1: service primarily for in car use, although you can you

5:21 Speaker 1: can put the app on your phone or any mobile device,

5:24 Speaker 1: a streaming app, and the SERIOUSXM podcast network, reaches a

5:29 Speaker 1: combined monthly audience of about one hundred and seventy million listeners.

5:33 Speaker 1: So the subscriber base for satellite radio is still very large.

5:37 Speaker 1: I mean, one hundred and seventy million listeners is a lot,

5:42 Speaker 1: it says here. Bloomberg said. Both companies, despite being the

5:45 Speaker 1: dominant players in their respective businesses, are struggling to attract

5:48 Speaker 1: new customers and compete with streaming platforms like Spotify and

5:53 Speaker 1: Apple Music. To better compete with these digital service providers,

5:58 Speaker 1: SERIOUSXM in July twenty twenty five, I've launched a new

6:01 Speaker 1: lower priced ad supported tier called Serious XM Play, priced

6:06 Speaker 1: at less than seven dollars a month. That same two

6:08 Speaker 1: years after Serious XM launched a nine to ninety nine

6:12 Speaker 1: a month Spotify challenger. The reported merger comes as more

6:16 Speaker 1: people listen to podcasts daily than to talk radio programming,

6:20 Speaker 1: Bloomberg said, citing Edison research. Both companies have tried to adapt,

6:25 Speaker 1: with SERIOUSXM acquiring online radio service Pandora in twenty eighteen

6:30 Speaker 1: for three and a half billion billion with a B,

6:33 Speaker 1: introducing a new app, and locking up exclusive distribution rights

6:36 Speaker 1: to podcast like SmartLess and Call Her Daddy. iHeartMedia has

6:41 Speaker 1: also built on its own podcast operation, distributing shows like

6:45 Speaker 1: My Favorite Murder, The Breakfast Club, and Las Culturistas. The

6:50 Speaker 1: company's podcasting revenue grew twenty six percent in twenty twenty five,

6:54 Speaker 1: while radio revenue fell four percent. In December, iHeartMedia partnered

6:59 Speaker 1: with Netflick for an exclusive video podcasting partnership that includes

7:03 Speaker 1: all new episodes from the company's podcast lineup. The company

7:07 Speaker 1: carries about five billion dollars in total debt following a

7:10 Speaker 1: bankruptcy in twenty eighteen, said Bloomberg. Wait, who's oh, iHeartMedia?

7:16 Speaker 1: So iHeartMedia has five billion dollars in debt following a

7:20 Speaker 1: bankruptcy in twenty eighteen. And by the way, for anyone

7:24 Speaker 1: who's confused about the bankruptcy thing, bankruptcy doesn't mean you

7:27 Speaker 1: go out of business necessarily. It may mean that your

7:30 Speaker 1: debt becomes restructured, but you continue. There's different types of

7:33 Speaker 1: bankruptcy and so forth. For anyone who's puzzled by how

7:37 Speaker 1: can they have gone through bankruptcy and still be operating,

7:41 Speaker 1: it says here. The continued growth in the podcast business

7:43 Speaker 1: prompted other digital service providers and social media platforms to

7:47 Speaker 1: expand their presence in the market. In October, Netflix and

7:50 Speaker 1: Spotify struck a deal for Netflix to stream video podcasts

7:53 Speaker 1: from Spotify Studios and The Ringer starting this year. Earlier

7:57 Speaker 1: in March, Spotify partnered with Hibe to put is that

8:01 Speaker 1: how you say that? Hybe Hibe to put? I'm not

8:04 Speaker 1: familiar with it? To put original K pop video podcasts

8:07 Speaker 1: on their streaming platform. In January, Spotify launched a new

8:10 Speaker 1: podcast studio in Hollywood. Okay, da da da da. So

8:13 Speaker 1: this's all this stuff they've been doing. But anyway, the

8:16 Speaker 1: point is this merger, it's very early, may not even happen,

8:20 Speaker 1: we'll see. But more consolidation, My opinion is more consolidation

8:25 Speaker 1: in the radio industry is not particularly a good thing,

8:28 Speaker 1: but inevitable. There's sure been a lot of it.