mobile-menu-icon
GM Authority

General Motors, SiriusXM To Alter Promotional Agreement

You know that free trial of Sirius XM satellite radio that comes with all GM vehicles in North America? Well, General Motors was paying the satellite radio company a fee for those evaluation periods — something that it will stop doing in the fourth quarter of 2013.

The discounted subscription rate was equivalent to roughly $20 for 3 months of service, and The General was one of the only automakers that had such a deal, as most other OEMs don’t (and didn’t) pay a fee — instead opting to be an “unpaid promotional partner” — in SiriusXM parlance. In exchange for the fee, Sirius XM gave GM a revenue share on the radio going forward that was about $5 per month for the life of the radio — as long as the subscription was active. In fact, the deal was crafted in such a way that GM received the revenue share from SiriusXM even on second or third owners of the GM car. (Sounds like an affiliate agreement, no?).

Well, by the end of this year, GM will cease paying XM the $20, and will no longer be eligible for the revenue share of new subscribers. This will decrease GM’s cost per vehicle on the front end, but will also decrease the revenue it receives per vehicle post-purchase.

The GM Authority Take

We imagine that the new deal with SiriusXM will be more financially favorable for The General going forward — hence the reason for the new arrangement, while having a few specific implications on Sirius’ business (read more about those here). Meanwhile, the move is not expected to affect GM customers or their access to trial periods to SiriusXM satellite radio with the purchase of new or Certified Pre-Owned GM vehicles.

GM Authority Executive Editor with a passion for business strategy and fast cars.

Subscribe to GM Authority

For around-the-clock GM news coverage

We'll send you one email per day with the latest GM news. It's totally free.

Comments

  1. I owned my 2006 CTS for 3 years, that whole time I had XM and didn’t pay a cent. Someone on the Cadillac Owners forum said that when the subscription runs out they send a signal to the radio, and if it is block (by say an underground parking structure) the radio just keeps on going. I don’t know how true that may be, especially since they will give non-subscribers a free month here and there, so when that free month is over the send the cancellation signal again…

    In any case if was free.

    Reply
  2. I had XM years ago they were halfway decent. Until the merger and it went to hell. Prices went up. the variety of music went way down.I think they gave every station 50 or 60 songs to play all day. I called them to cancel the service and they kept offering me lower lower prices. They offered me six months of service for $25. It has been over a year since I canceled they still send me email and snail mail with that offer. They have been replaced with Pandora stitcher and iTunes.

    Reply
  3. Love my xm in the car. Can listen to Fox news and sports games that are harder to find mobile. However I cancelled it in my house because I can listen to both Pandora and others thru my bluray or music channels on Comcast. One thing I rarely do is listen to AM/FM.

    Satellite radio will probably go away in a few years like Cassettes and CD’s.

    Reply
  4. I’ve had XM in my Malibu going on 3 yrs. now. I love it, although a bit pricey I think. The variety is great. I rarely listen to my CD’s any more. My only qualm is with it cutting out next to buildings and under things, but that is like the old FM drift thing. Oh well.

    Reply

Leave a comment

Cancel