Sirius XM Radio Inc (NASDAQ:SIRI) is beefing up its business content. The satellite radio provider is teaming up with the University of Pennsylvania’s iconic Wharton School of business to launch a new channel. When Business Radio Powered by the Wharton School launches early next year on channel 111, Sirius and XM subscribers will be able to tune into the insight of celebrity business school professors in a call-in format.
As someone who religiously thumbs between Sirius channels 112 and 113 — the rebroadcast of Comcast Corporation (NASDAQ:CMCSA)‘s CNBC and Bloomberg Radio, respectively — I can’t imagine that I will be the only one looking forward to a third channel for business news.
CNBC and Bloomberg were going to have company anyway. When Sirius XM Radio Inc (NASDAQ:SIRI) expanded its deal with Twenty-First Century Fox Inc (NASDAQ:FOXA) earlier this month, one of the deal enhancements was that it would begin carrying FOX Business Network this fall.
In short, by early next year, we will see Sirius XM Radio Inc (NASDAQ:SIRI) doubling its dedicated business channels. Sure, Business Radio is going to be more about business and entrepreneurship than investments; however, Wharton’s finance professor Jeremy Siegel’s Stocks for the Long Run is a classic investing book.
This is a smart deal for Sirius XM, and not just because it raises the allure of satellite radio to business-minded intellectuals.
By widening its programming, Sirius XM Radio Inc (NASDAQ:SIRI) will be on firmer footing when it’s time to negotiate extensions for CNBC and Bloomberg. Earlier this year, losing one or the other would be a major blow. Now that Sirius XM Radio Inc (NASDAQ:SIRI) will have more content in its arsenal, it can afford to play hardball.
Netflix, Inc. (NASDAQ:NFLX) has made this a popular model. By building up its digital vault, it can afford to let expiring streaming deals walk. Netflix, Inc. (NASDAQ:NFLX) is the one with all of the leverage as it gets bigger, and offers more options. The same thing is happening now with Sirius XM.
Cable and satellite television providers are grappling with the ever-increasing carriage rights of popular TV networks, but Sirius XM and Netflix, Inc. (NASDAQ:NFLX) don’t have to play by those rules. They can shake heads instead of shaking hands if a deal isn’t right.
The next few months and years will be both interesting and challenging for premium radio. It’s not just tomorrow’s launch of iTunes Radio. A world of connected cars, new partnerships, and hungry tech giants will enter into a bloody battle for your ears.
Sirius XM Radio Inc (NASDAQ:SIRI) is once again arming itself with content that will make it more appealing for potential subscribers, but these moves also give it more leverage in negotiating more compelling contracts with the content providers.
It’s just smart business, and you don’t need to wait until Business Radio launches next year to know that.
The article Sirius XM Means Business originally appeared on Fool.com and is written by Rick Munarriz.
Longtime Fool contributor Rick Munarriz owns shares of Netflix. The Motley Fool recommends Netflix. The Motley Fool owns shares of Netflix.
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