SiriusXM Sees ‘Incredible Opportunity’ in Connected Car, Meyer Says

SiriusXM’s year-old $530 million acquisition of Agero's connected vehicle services business (see 1308160071) "continues to produce good results," SiriusXM CEO Jim Meyer said on a quarterly earnings call Tuesday. "It has brought us even closer to the OEMs and opened the door to long-term cooperation on a variety of decisions relating to the next generation of connected vehicles." SiriusXM is "actively engaged with our existing OEM customers in defining the connected vehicle services that will be deployed in their vehicles over the following years," Meyer said. "The safety, security and convenience side of the connected vehicle is important, but so is our ability to innovate in the connected car on the audio side and integrate satellite radio with the benefits of two-way connectivity." Asked in Q&A whether SiriusXM was beginning to see "meaningful" penetration of new cars in its "mix" with Internet connectivity built in, Meyer said General Motors has begun rolling out LTE in its vehicles "at a pretty aggressive rate." But he cautioned that "GM's implementation of how they want that to work ultimately is still in a variety of phases in their vehicles." Still, "there's no question, built-in connectivity in vehicles is beginning to increase and, I think, will continue to increase every year going forward for many, many years," Meyer said. "I think this is an incredible opportunity for SiriusXM. I constantly get questions from analysts and investors about, ‘Isn't this bad for your business?’ And my answer to that question is, ‘Are you kidding me?’" Meyer thinks the rise of the connected car will "let us do a lot of exciting things for the next 10 years," he said. But as for giving a solid answer on the question about whether there has been any meaningful business impact yet, "we're just going to have to wait several months to make sure none of this is a head fake," Meyer said. "I've learned now, over the 10 years, we need to watch for several months to see how these trends roll out. But I promise you, we're watching it. And when we think we really understand what's going on, we'll be very public about it."