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Stern's Threat To Quit Sirius Could Be Empty Talk

"Who else can afford Howard Stern?" Harriss said.

When Stern signed with Sirius, the company trailed XM Satellite Radio Holdings Inc. in the race for customers. It badly needed a marquee name to attract subscribers to its service, which delivers 130 radio channels anywhere in the country for $6.99 a month to $19.99 a month, depending on the package.

Now after buying XM for $3.3 billion, Sirius has 18.5 million subscribers, down slightly from a peak of 19 million at the end of last year. Sirius' radio lineup beyond Stern includes Oprah Winfrey, Martha Stewart, NFL games and Major League Baseball. Half of its channels are music and free of commercials, while the rest air sports, talk shows, news, entertainment, traffic and weather.

The company still has never posted a net profit. Revenue was nearly flat in the last quarter, and Sirius remains pressured to cut costs. Sirius narrowly avoided bankruptcy protection 10 months ago by getting $530 million in financing from Liberty Media Corp. Sirius had to give a 40 percent ownership stake to Liberty, which is controlled by satellite mogul John Malone.

As Sirius tries to get its finances in order, it must cope with threats from emerging technologies, such as Internet radio services that also deliver radio programming without commercials.

The company has been trying to cut costs. Sirius' programming expenses in the past four quarters fell 18 percent from the total paid by Sirius and XM in the previous year, when they were still separate companies. Sirius has eliminated duplicative radio programs since it absorbed XM and found ways to reduce "on-air talent costs."

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