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Is Howard Stern still worth $100 million a year? He thinks so.

Is Howard ready to stick it to Sirius?

Tuesday morning on his radio program Howard Stern reportedly discussed his ongoing contract negotiations with Sirius satellite radio, announcing that, “I am not taking a f—ing paycut.” His tirade was in response to comments made by Sirius CFO David Frear at a UBS investor conference where he hinted that a new contract with Stern might be for less money than his current $100 million a year. Frear also observed that the Stern contract happened in a climate where there were two competing satellite radio companies, whereas now there is only one. He said that as these contracts come up for renewal, “we’ll have the opportunity to get more favorable economic terms there.”

Last week a completely unsubstantiated rumor surfaced on Twitter claiming that Stern might get lured away by Apple, of all companies, in order to do an iTunes-exclusive show for even more money–$600 million. Despite the Columbia Journalism Review chiding journalists for reporting the completely anonymous tweet, the rumor took on a life of its own, with commentators left and right speculating about Stern’s next move, even if most doubt Apple would pony up that kind of cash for an exclusive deal with Stern. Nevertheless, even the Sirius CFO mentioned the possibility of Stern starting his own internet streaming channel.

The real question at hand is whether or not Stern and his power to draw listeners to Sirius is worth $100 million a year. I don’t doubt that Frear was testing the waters at the UBS conference to find out what investors might think of a Stern-less Sirius.

If Stern decides to walk away from Sirius I’m highly doubtful that he’ll find another company willing to pay him nearly as much to do his program, whether its online, on television or back on broadcast radio. He certainly could choose to go independent and online, but again, I’m doubtful he could gross anything close to $100 million anytime soon. Sirius’ gross income is only about eleven times Howard’s annual take, and the company’s got a couple of hundred other channels.

If Sirius decides that Stern isn’t worth $100 million annually, and Stern decides he won’t settle for less, it will be interesting to see if his departure costs the company. That $100 mil amounts to the price of 7.7 million monthly just over 641,000 annual subscriptions, about 39% 3.2% of the service’s current subscriber base. Are there really 7.7 million 641,000 Stern fans ready to dump Sirius if he goes? I really don’t know, and I’m sure that’s the question Sirius executives are trying hard to answer right now.

What we didn’t know last week when I last pondered the situation was if Howard was willing to accept less than his current salary. If one is to believe his tirade on Tuesday, the answer is, no, he won’t accept less. But Howard also trades in controversy and a willingness to bite the hand that feeds. So his on air comments might also be his way to stay in the news and stick it to Sirius.

Whatever happens may be a real test of both Stern’s star power and the value of Sirius’ entire slate of programming. It could also be a test of whatever medium Stern chooses after Sirius. The most boring thing that can happen is that he’ll sign that renewal.

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18 Responses to Is Howard Stern still worth $100 million a year? He thinks so.

  1. Adam December 8, 2010 at 10:44 am #

    I may be doing the math wrong here, but at 13 bucks a month each subscriber pays $156 a year. If you divide 100,000,000 by 156, you get 641,025. That’s a pretty small amount of subscribers that has to leave in order for Sirius to take a loss by not paying Stern what he wants.

  2. Adam December 8, 2010 at 10:47 am #

    I think you are doing the math wrong there, the $100,000,000 is an annual salary, not monthly. if you take the 7.7million number you wrote and divide it by 12 you get the true number of subscribers that has to leave for stern’s deal to not make sense fiscally, a little under 642,000

  3. Paul Riismandel December 8, 2010 at 10:50 am #

    Adam, you’re correct. I missed a step on my math. Thanks for the correction. I’ll update the post.

  4. AFV December 8, 2010 at 11:36 am #

    Look at it this way. 6,000,000 people signed up when Howard moved to Sirius. They went from 600k subscribers to 6million. Take that 6mil multiply by $15 multiply that by 12 and then that by 5 years and you’re looking at $5billion. If 50% of those leave Sirius will be history.

  5. zach December 8, 2010 at 11:43 am #

    Stern is the only reason I listen to sirius, the other programing stinks. Howard leaves, and I cancel my three subscriptions. So you can also think about that not being 642,000. they make you guy a subscription for each vehichle. I have one in each of 3 cars.

  6. Amber December 8, 2010 at 11:47 am #

    The Sirius content isn’t bad. Its simply not compelling.

    Stern leaves and so too does my subscription.

  7. Ken December 8, 2010 at 11:50 am #

    Same as Zach here, my four subscriptions have become one while I wait to see if Sirius and Stern can come to terms. If not, my last one goes as well. Too many other sources for audio entertainment available.

  8. Albert Haynesworth December 8, 2010 at 11:59 am #

    I dropped my Sirius subscription after the recent price-hike; no way is the “service” worth more, especially with the drop-off in Stern’s quality over the past two years.

  9. Norma Stitz December 8, 2010 at 12:08 pm #

    I have three subscriptions all set to Stern only. If he goes I am also cancelling all subscriptions. I have already cancelled one pending his annoucement.

  10. JessieHogg December 8, 2010 at 12:21 pm #

    Each car or subscription counts as one. If you have 3 cars, that counts as 3 subscriptions. He is not worth 100 million a year, but that stupid Frear should have not said anything. He would have taken a pay cut in silence and now you gave him and his idiot fans a subject for discussion. I used to be a big fan and now it’s the same show for the last 20 years. Boring and nobody cares about sat. radio…you might as well be on another planet. You are telling me, I have to pay for bleepin RADIO!!!!!!

  11. Neal Barkett December 8, 2010 at 12:30 pm #

    What does his show also pull in from advertising dollars?

  12. Dan December 8, 2010 at 1:10 pm #

    That $100,000,000 is not the “Stern Salary” it is Sirius/XM’s payment for the show in its entirety. From that yearly amount Stern has to pay for the total sum of show expenses including his own salary and those of the crew. With 200 shows a year it equates to $500,000 per show to put it into perspective. Regardless I think Sirius is reaping in far more than that a day just for that 4-hour show alone. To give you an idea of how much they profit off it I was able to fairly easily get my next years service fee cut by 66% by just mentioning that I would not renew if Stern leaves. For $5 a month now it is worth the gamble to hold out another year.

  13. WALT MILOS December 8, 2010 at 1:54 pm #


  14. Sir Dooley December 8, 2010 at 2:53 pm #

    Listen, this is simple. Without content sirius is nothing, music can be heard on regular radio, cd’s, ipods, pretty much anywhere. The reason people are willing to pay for a service is because its exclusive. Howard has always given his employer that. Sirius should pay somebody to spritz his balls when he gets the slightest sweat on them. Without him they are worse than dead, its over ! This son-of-a-bitch delivers, plain and simple. Sure his fans are a little bias but if somebody thinks for one minute that if they(sirius) let him walk that people are going to pay to listen to music they’re dead wrong.

  15. Siriusbuzz December 8, 2010 at 8:52 pm #


    Yes, you have to pay for bleepin RADIO… and you do, every time you listen. Just like you pay to read this blog. One way or another you pay, no content is free… it is ad supported. If you are OK with listening/reading ad supported content, that is fine, a lot of people are. Just make sure you realize that it is not free.

  16. anonymous December 9, 2010 at 4:17 pm #

    the subscriber base is just the start of it… Stern’s show brings in over 30 mil of advertising dollars a year for Sirius. Most of his sponsors would not move to other stations.

  17. lol really January 14, 2011 at 12:44 pm #

    I simply loved the few posters who posted a few minutes of each other crying that they will drop their “3” or “4” subscriptions. lol

    Someone has too much time on their hands.

  18. vittorio November 9, 2011 at 6:18 am #

    I do the job for 100,000 yr. he gets to much money look at the stock price

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