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Volume 26 No. 225
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Stern Squared: Sirius’ New NBA Deal Includes Sponsor Right

The NBA and Sirius Satellite Radio have signed a multi-year agreement that expands upon their current deal signed in February ’03 and makes Sirius the league’s official satellite radio marketing partner. Sirius will air more than 1,000 regular-season games, plus every game of the NBA playoffs and finals. In addition, Sirius has launched “NBA Radio on Sirius,” the first 24/7 year-round radio channel devoted to the NBA. Sirius will conduct NBA-themed advertising and promotions with NBA, team and NBA Radio on Sirius logos via league media assets and the NBA Store. The NBA Store will also feature an interactive Sirius display. NBA.com will include ads, logo placement and a link to Sirius.com. Sirius ads will also appear on NBA TV and other NBA media outlets, while NBA promotions will run within Sirius media inventory (NBA). DAILY VARIETY’s Steven Zeitchik notes the announcement of Sirius’ NBA deal did little “apart from making official a previously forged partnership.” NBA Radio on Sirius, for example, “launched two weeks ago” (DAILY VARIETY, 12/14).

THE DEALMAKERS: While Bank of America analyst Jonathan Jacoby yesterday cut his Sirius rating to “sell,” NBA Commissioner David Stern said, “I’m not prepared to bet against (Sirius CEO Mel Karmazin) or the assets he’s put together at Sirius.” Karmazin said he does not know how many subscribers will join as a result of the NBA deal, but added, “It’s all about the content and ... getting these important branded products.” When asked on CNBC’s “Power Lunch” whether he is concerned about the league’s image with Howard Stern also being carried on Sirius, Stern replied, “Our games are available on cable and satellite. Have you seen the offerings on cable and satellite?” (CNBC, 12/13).

PRICE IS RIGHT? Jacoby noted XM “has a larger share of carmakers locked up to sell its products — roughly 60% and Sirius is roughly 40%.” CNBC’s Mary Thompson: “Jacoby also notes Sirius has only 40% of the market for satellite radios sold at Wal-Mart, something he thinks is an increasingly important outlet for these products. The reason: price. XM has cheaper products” (CNBC, 12/13).