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TheStreet Open House

Stern's Threat To Quit Sirius Could Be Empty Talk

For these reasons ¿ and because Stern has warned other times that he might quit or retire ¿ his latest threat rings hollow to some analysts.

"It's probably positioning for contract negotiations," said Brett Harriss, an analyst at Gabelli & Co., whose parent Gamco Investors Inc. owns 1.1 million shares of Sirius. "I don't think he would give up his bullhorn."

Sirius' chief executive, Mel Karmazin, told The Associated Press in a recent interview that he will work hard to retain Stern, but the company would not offer more detailed comments. Stern's agent, Don Buchwald, did not respond to requests for comment.

Stern made his name on traditional or "terrestrial" radio. While Sirius mainly makes its money from selling subscriptions, the money that flowed to Stern on traditional radio came from syndication rights. In that setup, radio stations pay companies that distribute programs such as Stern's.

Many of those radio stations have struggled since Stern left the free airwaves, and the recession compounded the problems. In the first nine months of the year, radio advertising revenue fell by 21 percent to $11.8 billion, according to the Radio Advertising Bureau.

Citadel Broadcasting Corp., the nation's third-largest operator of radio stations, filed for bankruptcy protection Sunday. Other big station owners also are wrestling with debts, and the syndication division of the largest station owner, Clear Channel Communications Inc., already is believed to be paying Rush Limbaugh $400 million over an eight-year contract.

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