“So there you have it. Another solid quarter from SiriusXM in a more challenging environment. Steady growth continue[s] with record levels of profitability, and we were a razor’s edge away from a 40% margin in the third quarter.” – SiriusXM CEO Jim Meyer, 10.25.17
SiriusXM’s recent third quarter earnings call was another positive portrayal of a company that relies on the talents of music creators to fuel its business model. A business model that is in fact INSANELY profitable. According to Forbes, the industry with the highest average profit margin is accounting at 19.6%, the AVERAGE private sector profit margin is 7.3%.
SiriusXM CEO Jim Meyer spoke at length about how keeping pace with modern technology and new expectations from music fans has paid off, saying “All men may be created equal, but all business models are certainly not.” Indeed, and SiriusXM’s business model is certainly not equal.
SiriusXM benefits from an outdated sweetheart deal granted by the U.S. government over 20 years ago that shields it from market forces and virtually guarantees it will pay an unfair, below-market royalty rate for the music that it plays. Grandfathered deals benefiting SiriusXM and AM/FM radio stand in stark contrast to streaming services, which pay music creators at fair market value.
SiriusXM rightly touts its modern technology and responsiveness to fans. How about embracing a modern business model that compensates artists at fair, market-based rates? Their huge profit margin would seem to be able to accommodate and still keep investors very happy.
In this day and age, where or how we listen to music shouldn’t impact music creators financially. It’s time to level the playing field across all platforms and ensure music creators receive fair compensation for their performances.
Contact your Members of Congress and tell them you stand against Big Radio.Contact congress