Sirius Satellite Radio History

Sirius Satellite Radio is the brain-child of an ex-NASA engineer, Robert Briskman. Before starting Sirius, he was the chief of operations at Geostar, which was a satellite messaging company. While working here, they had created technology, by which digital radio signals could be broadcasted via a satellite. Briskman and many other people working in Geostar, came together and started a company called Satellite CD Radio, Inc. in Washington DC, in the year 1990. This was the very beginning of the giant corporation Sirius Satellite Radio, Inc.

David Margolese, a Canadian venture capitalist, invested $1 million in Satellite CD Radio, and also later began working with the firm and was appointed the CEO. The company's aim was to develop a broadcasting system with satellites, that would deliver digital radio streams to people having a special receiver. They wanted to earn revenues by charging the listener a certain amount as subscription fees.

CD Radio, Inc. was the name given to the company in 1992 and Satellite CD Radio, Inc. became its sole subsidiary. In this period there were many companies trying to create satellite radio networks. In 1993 a company called Sky Highway Radio Corp. was bought by CD Radio for $2 million. By now the company had incurred huge development costs, which amounted to $10 million, and also they had a deficit of $9.5 million. The company had no other option but to make their initial public stock offering on the NASDAQ. The company managed to raise close to $7.5 million. Their prospectus had claimed that the company would broadcast 30 commercial-free music channels, having CD quality audio, on the S-Band receiver sets, which were not yet manufactured. The company planned to charge a subscription fee of less than $10 per month.

Next the company struggled to get the license, to broadcast digital radio signals. It met with stiff opposition from the National Association of Broadcasters, who were against satellite radio. In 1997 eventually the company managed to buy the required license from the FCC at an auction, for a price of $83.3 million dollars. This in fact was a discounted price as they were eligible under the Pioneer's Preference Program, because they had been the developers of this technology. In the same year the company also signed a contract with Loral Corp. to build two satellites.

Finally in 1999, ten years after its inception, the company announced its plans to begin broadcasting. The company was renamed Sirius Satellite Radio, Inc. after the brightest star which is visible in the night sky. The company was facing huge costs as it was now building three satellite networks, which was estimated at $965 million. In May that year the company's financing topped $1 Billion and it sold $200 million worth of senior notes to investors.

In the year 2002 after an initial legal squabble with XM, the two companies agreed to jointly develop unified standards for satellite radio. In the same year Sirius successfully launched three satellites into orbit, and also saw the beginning of the nation-wide service. The company was always hounded by lack of finance and to boost its subscription list, it signed a $100 million a year deal with the controversial radio “shock jock” Howard Stern in 2004. In 2003 the company had already signed a deal with NFL for $220 million.