Google Makes Ad Deal with XM Satellite Radio
In what looks like its biggest offline advertising deal to date, Google has struck a deal with XM Satellite Holdings to automatically insert adds on the service's nonmusic channels. According to a statement, Google will serve the ads via dMarc's media network on XM stations. XM has about 7 million paid subscribers. The deal will potentially allow XM to increase revenue with advertisers while decreasing the cost to serve those ads. Google has said it will be integrating the dMarc platform into AdWords by the fourth quarter of this year. AdWord's customers will then be able to place satellite and terrestrial spots on the air. Google CEO Eric Schmidt said during the company's second-quarter earnings call that DMarc's staff was completely integrated with Google's, and that Google was testing radio ads nationally as well as internationally. XM leads the satellite radio market and reported a 56 percent increase in customers over the last year. According to the company's 2Q06 results, XM increased its revenue year over year, but it also increased its net losses, in part due to the increased cost of acquiring customers. XM's main competition in the satellite market is Sirius, which has less than five million subscribers and revenues of $150 million. Google has experimented with offline advertising before. Its first experiment, brokering ad pages for magazines, has not fared well. Google has also been making inroads into the auto market, where satellite radio is also popular. |
Comments (17)
I thought that satellite radio was supposed to be ad-free, I say a bit facetiously. Just like cable TV stayed ad-free, right!? Don't know who would pay for radio when it is free. But, they said the same about cable. We have way too much disposable income.
Posted by L. LaBrie | August 2, 2006 9:22 AM
i signed up for xm satellite radio becasue of the ad-free. it is extremely disappointing when listening to have commericals.
Posted by kim | August 2, 2006 10:19 AM
This is total CRAP!!!! I pay for XM to avoid listening to commercials. XM-21 has been playing them and they're worse than radio adverts. If Sirius is still commercial free, I'll be moving over to them. I guess they're going to go the cable-tv route.
Posted by XM BS | August 2, 2006 2:21 PM
I got XM for O&A and Ron & Fez shows, XM202. They have ads, but mostly for other XM channels. When you host talk shows, you do need a break once in a while, (sometimes adds, sometimes small clips of previous shows). If they are on a roll, they go as long as they want. No need to break for sponsors. If they cut down on the airtime to play adds like Free FM, I'll be quite upset. Upset enough to cancel my subscription. Tell Google to "Go Screw
Posted by BMac | August 2, 2006 2:25 PM
Can't you people read. "automatically insert adds on the service's nonmusic channels" see nonmusic. Yes there are a couple Clear Channel channels that a court has ordered XM to put comercials on. You are a fool to listen to that. XM setup other channels to make of for that poor deal with CC. This is really just a behind the scenes tech deal with Google. They are providing the tech for inserting the adds that XM already has on some channels.
Posted by MA | August 2, 2006 3:15 PM
XM has NEVER BEEN ad-free. In its early days, XM ran a few quick, unobtrusive ads on some of its music channels, but once Sirius came along, they dropped all advertising on music channels. Much of XM's news and public affairs programming is taken from commercial sources, so even if they ran no ads, they would still need to do something to fill the long silences provided for advertising.
Posted by BH in AL | August 2, 2006 3:33 PM
In a move that could have repurcussions for Google's offline advertising plans, several major advertisers have banded together to revolutionize the way ads for television are bought and sold. Central to their plans is an online auction marketplace called e-Media Exchange, powered by eBay.
Posted by Google Watch | August 4, 2006 1:27 PM
In a move that could have repurcussions for Google's offline advertising plans, several major advertisers have banded together to revolutionize the way ads for television are bought and sold. Central to their plans is an online auction marketplace called e-Media Exchange, powered by eBay.
Posted by Google Watch | August 4, 2006 1:56 PM
In a move that could have repurcussions for Google's offline advertising plans, several major advertisers have banded together to revolutionize the way ads for television are bought and sold. Central to their plans is an online auction marketplace called e-Media Exchange, powered by eBay.
Posted by Google Watch | August 4, 2006 3:19 PM
Although Google's revenues are tied to seasonal fluctuations in Internet usage, it's possible that their offline advertising products could increase online searches, thus partially offsetting that trend.
Posted by Google Watch | August 10, 2006 2:02 PM
Although Google's revenues are tied to seasonal fluctuations in Internet usage, it's possible that their offline advertising products could increase online searches, thus partially offsetting that trend.
Posted by Google Watch | August 10, 2006 5:51 PM
Although Google's revenues are tied to seasonal fluctuations in Internet usage, it's possible that their offline advertising products could increase online searches, thus partially offsetting that trend.
Posted by Google Watch | August 13, 2006 1:24 PM
A media and entertainment analyst issued a note this week saying it would make sense for Google to take minority stake in radio, TV and outdoor advertising giant Clear Channel.
Posted by Google Watch | November 2, 2006 2:08 PM
A media and entertainment analyst issued a note this week saying it would make sense for Google to take minority stake in radio, TV and outdoor advertising giant Clear Channel.
Posted by Google Watch | November 2, 2006 2:11 PM
A media and entertainment analyst issued a note this week saying it would make sense for Google to take minority stake in radio, TV and outdoor advertising giant Clear Channel.
Posted by Google Watch | November 2, 2006 2:14 PM
A media and entertainment analyst issued a note this week saying it would make sense for Google to take minority stake in radio, TV and outdoor advertising giant Clear Channel.
Posted by Google Watch | November 2, 2006 2:21 PM
A media and entertainment analyst issued a note this week saying it would make sense for Google to take minority stake in radio, TV and outdoor advertising giant Clear Channel.
Posted by Google Watch | November 2, 2006 2:26 PM