Homepage

    SAVE   |   EMAIL   |   PRINT   |   RSS  
Martha gets Sirius in radio deal
Martha Stewart Living and satellite service announce venture for a lifestyle radio channel.
April 18, 2005: 6:05 PM EDT
Martha Stewart is serving five months of house arrest following a criminal conviction a year ago for lying to investigators about a personal stock sale.
Martha Stewart is serving five months of house arrest following a criminal conviction a year ago for lying to investigators about a personal stock sale.
Video More video
Martha Stewart talks about her love for radio and enthusiasm for her latest project.
premium content Play video

NEW YORK (CNN/Money) - Martha Stewart Living Omnimedia and Sirius Satellite Radio announced Monday a joint venture to launch a lifestyle channel on the subscription-based radio service.

Appearing at a news conference, Stewart said the 24-hour-a-day channel will offer tips on home decorating, entertaining, gardening, kids, pets and weddings, among other domestic topics.

Martha Stewart Living Radio, which will regularly feature the lifestyle maven herself, is expected to air later this year. Terms of the four-year deal were not disclosed, but BusinessWeek Online reported Monday afternoon that Martha Stewart Living (up $1.15 to $20.72, Research) is guaranteed a total of $30 million in fees. The company will also collect advertising revenues and possibly share subscription fees with Sirius.

Martha Stewart Living investors cheered the news and drove company shares up nearly six percent, to $20.72, Monday. The stock price is trading 45 percent below its February 52-week high.

For Martha Stewart Living, the Sirius announcement is yet another in a string of recent deals meant to revive the New York media and merchandising lifestyle company. The company has two television projects in the works for the coming fall, both starring Stewart.

While it remains to be seen how Martha Stewart Living's emphasis on the visual translates to radio, Stewart and Martha Stewart Living CEO Susan Lyne were enthusiastic about the prospect of reaching consumers around the clock.

"Radio gives us an opportunity to interact with (our audience) on a very personal and immediate level," said Susan Lyne, Martha Stewart Living's CEO. "Women lead very busy lives these days ... commuting to work or driving kids around."

Stewart, 63, is serving five months of house arrest following a criminal conviction a year ago for lying to investigators about a personal stock sale. She was released in early March from a minimum security prison in West Virginia, having served a five-month sentence.

Stewart is allowed to leave her Bedford, N.Y. home for up to 48 hours a week for limited reasons, including work. Last week she appeared at a few New York events, including the National Magazine Awards, where two Martha Stewart Living magazines took top honors.

Sirius (down $0.07 to $5.08, Research), meanwhile, is the second-largest satellite radio provider behind XM Satellite Radio (down $0.31 to $27.19, Research). Both companies are aggressively lining up celebrities and other content providers in their race to be the industry's dominant player.

The satellite radio market has grown from 380,000 subscribers three years ago to more than five million today. Sirius offers more than 120 channels, compared to 150 for XM. Both charge $12.95 a month for basic subscription service, not including the cost of the initial hardware.

Sirius CEO Mel Karmazin said in a statement that he expects the Martha Stewart deal to generate "both significant subscriber growth and substantial advertising revenue." Karmazin is the former No. 2 at Viacom, owner of the country's second-largest terrestrial radio company, who joined Sirius late last year.

Sirius also has a five-year, $500 million deal to add Howard Stern to its lineup early next year.

Catch up on all the names in the news by clicking here.  Top of page

graphic


YOUR E-MAIL ALERTS
Sirius Satellite Radio Incorporated
Martha Stewart
Martha Stewart Living Omnimedia Incorporated
Corporate Governance
Manage alerts | What is this?