The End Of Howard Stern Came Via Satellite Radio

In 2004, Howard Stern, a raunchy radio host, left Viacom broadcasting to join Sirius Satellite radio. The radio contract was for five years, which has earned Howard Stern $500 million. His motivation was his being censored by the Federal Communication Commission. Now Stern can say anything he wants because the FCC doesn’t regulate the content of satellite programming.

Investors put billions of dollars into satellite radio because they believed it to be the next best thing. Sirius radio not only has no censorship, it also has no commercials. However, you do have to pay a subscription. You can pay $12.95 per month or you can also pay $142.45 for one year or $271.95 for two years. If you activate an additional radio, then you pay $8.99 for the additional radio.

Satellite radio looked good on paper, but in reality, it's a money pit. When Howard Stern came on board, the price of the shares skyrocketed. The problem is that it only lasted for a short while. Sirius radio got into debt and it can’t get out. The merger plan isn’t going to rescue Sirius or its investors.

Here’s what happened. Howard Stern’s icon status skyrocketed the market price. Plus, investors reasoned that commuters are stuck in traffic. They don’t want to hear commercials so satellite radio would be in demand. Emotions and optimism overpowered common sense, so more people invested in the unprofitable, but alluring company. The investors never lost faith in Stern, but the snarky radio host couldn’t bring the dream to fruition. Consequently, not only is satellite radio ruined, but Howard Stern’s career is ruined as well.