The majority of the company's revenue comes from its satellite radio service, but the CEO sees an opportunity in streaming to attract younger, more diverse audiences. The launch of an updated streaming tech stack will be the key to that.
She told analysts that the underlying technology architecture is being changed to enable better commerce, identity and marketing capabilities. Enhanced search recommendations and other features will be added to a brand new consumer-facing experience.
According to Witz, the satellite broadcaster has not been well positioned with its current streaming technology. The company will be able to do a better job at growing streaming-only subscribers if the tech stack is rebuilt. There is no rebuild that includes Pandora.
It is part of a larger effort to improve the listening experience.
Witz said during the satcaster's fourth quarter results call that they are becoming more and more choosy to attract new audiences to their platform. It made it easier and better for subscribers who prefer to stream in the car to do so last year. The streaming technology will be modernized.
We have our own radical evolution.
Witz said that the evolution of the in-car should be viewed in the same way as the evolution of the auto. We are committed to our own radical evolution with future-focused, consumer-first in-car experiences.
In the fourth quarter, SiriusXM launched a free trial version of its service in electric vehicles that included a large touchscreen interface, as well as on-demand and satellite radio. Witz says they are working on similar projects with other car companies.
A double-digit increase in listener engagement was achieved by the next-gen 360L receiver. Data-driven music and talk recommendations are delivered to the dashboard screen when the interactive radios are rolled out. The company is using enhanced features to covert more trials.
The company has noticed that there are different types of content that different subscribers engage with. For example, streaming-only subscribers who are younger and more diverse than in-car subscribers show high interest in the offering's on-demand music shows and extras. The retention of both groups when they engage with non-music content is higher than when they only listen to music.
Listener metrics can be diving deep.
The company has been gathering insights to get a better picture of what listens are consuming during their trial period to serve them better recommendations and ultimately convert more of them into paid subs. The metrics we're watching on streaming are early engagement in trial, number of days, length of time and breadth of content. Those are the early signs of who will stay with us.
The company decided to create more original on-demand content in order to complement its linear radio offering. Witz said, "Our goal is to connect the in-car and out-of-car experience to better serve our listeners, getting them content they want to hear faster, no matter where they are listening."
Despite consumer spending under pressure, record low car sales and a weaker ad market, SiriusXM says its revenue remained the same. The total revenue for the year was $9 billion. With record low car sales and uncertainty in the advertising market, investors sent shares of SIRI down 10% in Thursday trading to close at $5.30 in a stock market that rose 1%.
