TELECOM Digest OnLine - Sorted: Delphi, XM Unveil Handheld Satellite

Delphi, XM Unveil Handheld Satellite

Marcus Didius Falco (
Sun, 31 Oct 2004 00:46:41 -0500

A nice photo on the original main page.

Delphi, XM Unveil Handheld Satellite Radio Receiver

By Annys Shin
Washington Post Staff Writer

XM Satellite Radio and radio manufacturer Delphi yesterday introduced
the Delphi XM MyFi, a portable, handheld satellite radio receiver the
companies hope will lure more consumers to a medium currently limited
to car and home units.

Along with giving its subscribers the convenience of a traditional
transistor radio, the MyFi also offers a five-hour recording capacity
to let listeners download favorite programs and songs.

The MyFi is the latest entry in the highly competitive battle over
digital music, a fight that pits XM against its immediate competitor,
Sirius Satellite Radio, but more broadly against on-line music sources
like Napster, and the makers of small, highly portable MP3 and other
devices. It was unveiled at a New York nightclub on the same day that
Apple Computer used rock superstars U2 to promote the release of a
higher capacity iPod, and less than a month after Sirius announced it
had signed popular radio personality Howard Stern to a five-year

Since it launched its service three years ago, XM has reached its 2.5
million subscribers through factory-installed receivers in
automobiles, detachable units for other cars, and Delphi
boomboxes. Over the past several weeks, it also announced a deal to
pipe music into Starbucks stores, and to offer programming online for
paid subscribers.

But XM's service, along with that of Sirius, has lacked the
portability of devices such as the iPod and MP3 players. Now, with the
MyFi, subscribers can receive XM's more than 130 channels of talk,
news, sports, and commercial-free music, on a device about the same
size as a handheld organizer.

Unlike Delphi's plug-and-play satellite radio receivers, the MyFi
doesn't require an antenna and can be used with headphones. The device
also comes with a docking station for recharging and accessories to
hook it up to car stereos and home audio equipment.

MyFi will be available in stores and through on-line retailers in
December -- too late for the post-Thanksgiving shopping rush, but
still in time for the holiday gift-buying season. The suggested retail
price of $349.99 makes it a high-end item, said analysts. And
consumers still have to pay $9.99 per month for programming. But XM
officials and analysts said the product is likely to appeal to those
who prefer to have disc jockeys serve up music instead of having to
burn their own CDs or download music to MP3 players.

Such "user-intensive" devices require consumers "to work too hard to
get the freshest entertainment product," said Francisco Ordonez,
president of Delphi Product and Service Solutions.

Ordonez and XM Satellite Radio chief executive Hugh Panero unveiled
the MyFi at the Chelsea nightclub in Manhattan before an audience of
about 50 reporters and Delphi and XM staff, as they nibbled on
potato-goat-cheese-and-wasabe dumplings and shrimp on skewers.

In his remarks, Panero called the MyFi "the next big step" in the
evolution of XM Satellite Radio.

Ordonez called the MyFi "a change not just in the satellite radio
category, but in consumer electronics," and likened its debut to the
introduction of the transistor radio and the portable CD player.

At the end of his remarks, Panero quipped, "We've gone Hollywood," and
on cue, several "lifestyle" models -- a young male in a red hooded
sweatshirt, a young woman in a pink track suit and a man in a business
suit, among others -- descended a set of stairs, listening to the new

XM officials would not disclose how much they spent to develop MyFi or
how much they intend to spend on marketing it. They did, however,
preview a new television spot featuring singer Elton John hawking the
MyFi and his new song, "Answer in the Sky."

The roll out of MyFi caps a busy month for XM, which earlier this
month debuted the "Bob Edwards Show," and shock jocks Opie and
Anthony. On Oct. 20, the company also announced it had signed an
11-year, $650 million broadcasting and marketing deal with Major
League Baseball.

Shares of XM closed yesterday at $32.54, down slightly from $32.74.

Even before the MyFi debut, XM Satellite Radio was on target to reach
its goal of 3.1 million subscribers by year's end, said Janco Partners
analyst April Horace.

"Will [the new device] continue to drive subscription growth? Yes,"
Horace said. "Has XM expanded the marketplace once again? Yes."

In a research note released yesterday, Legg Mason's Sean Butson wrote,
"Although we are disappointed that the device will not be available
until after Thanksgiving, we do believe it will be a game-changer and
provide XM with a differentiated weapon in its retail arsenal."

Copyright 2004 The Washington Post Company

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