Howard Stern, whose defection in 2006 from terrestrial radio to satellite defined the new medium, is reportedly on the verge of signing a long-awaited contract renewal with SiriusXM.
Investors are taking Bloomberg’s report of a $120 million extension as gospel, boosting shares in SiriusXM more than 4% on double their average trading volume.
The company has not yet addressed the report, but the company has been under the gun because the marketplace in audio has grown competitive. Spotify in particular showing a willingness to swoop in and grab top talent. The boom in podcasting and mobile streaming have expanded the potential scope for SiriusXM, which for many years was focused on reaching scale through vehicle installations.
Last month, SiriusXM CEO Jim Meyer said at a Wall Street conference that he was “optimistic” about a renewal of Stern. “We have had Howard for 15 years and I am sure that every penny we paid Howard our shareholders have benefited,” Meyer said. “And I have been really clear, I want Howard Stern to work at SiriusXM as long as Howard Stern wants to work.”
Stern, the self-proclaimed “King of All Media,” has modulated his longtime shock-jock act in recent years. A 2019 memoir (which despite all of Stern’s earnest reflection, was nevertheless titled Howard Stern Comes Again) explored his own development through psychotherapy and his evolving approach to interviewing.
In a note to clients Wednesday, B. Riley analyst Zack Silver said he found the Bloomberg report to be credible.
“Is Howard Stern really still worth $100M+ a year?” he writes. “Our recent survey work suggests that only a low-single-digit percentage of respondents subscribe to SiriusXM solely because of Howard Stern. That said, we do believe marquee exclusives like Stern help support SiriusXM’s premium price point, as well as differentiate the service from other subscription audio platforms. And for investors, we believe that a potential renewal with Stern serves as a proof point that SiriusXM can continue to retain and attract top talent to its service.”
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