Washington Post Staff Writers
Thursday, October 7, 2004; Page A01
Howard Stern announced yesterday that he is leaving the Viacom broadcasting empire to join the world of satellite radio, creating what could be a breakthrough moment for a three-year-old medium.
The raunchy radio morning man stunned his staff by saying he has signed a five-year, $500 million deal with Sirius Satellite Radio, portraying the move as a response to "censorship" efforts by the Federal Communications Commission, which does not regulate the content of satellite programs.
Morning broadcast radio star Howard Stern has signed a five-year, $500 million deal with Sirius Satellite Radio, giving the fledgling medium a huge boost.
Transcript: Washington Post columnist Marc Fisher was online to discuss the announcement
"It has been one big nightmare the last couple of years, really the last 10 years," Stern, who plans to fulfill the final 15 months on his Viacom contract, said in an interview. "I lost my joy for radio." As for his new home, he said: "I believe this is the future. This satellite radio will overtake terrestrial radio."
Combined with the defection of Bob Edwards, the former National Public Radio host who debuted this week on XM Satellite Radio, Sirius's Washington-based rival, Stern's decision could lead a flood of subscribers to begin paying for what has long been taken for granted as a free part of the media landscape. Sirius, which last year signed a seven-year, $220 million contract to carry all regular-season National Football League games, charges $12.95 a month. XM's monthly fee is $9.99.
"We think this is a transforming event as the top radio personality has moved to a new technology and a relatively new company," said Joseph P. Clayton, chief executive of New York-based Sirius, adding that half the country has never heard of satellite radio. He said Sirius, which has 600,000 subscribers, can turn a profit on the deal -- which includes a new studio and salaries for Stern and his on-air gang -- if the move attracts 1 million new paying customers. Stern's show is estimated to draw more than 10 million listeners.
Stern, 50, who pioneered the syndication of a local radio show, likened his motivation to the creative freedom that comedians enjoy on HBO as opposed to the broadcast networks. He accused "religious groups" of "throwing a jihad at my advertisers, threatening them, bullying them, threatening boycotts." He also castigated the chairman of the FCC, which has been fining Stern's stations for more than a decade.
"We can't even figure out what Michael Powell, Colin Powell's son, wants," Stern said. "This guy is able to tell everyone what's decent and what isn't. . . . You've got the government ripping apart the show." He said that comedy bits he was able to air two years ago -- talking about bodily functions, as opposed to hard-core sex -- were now barred by Viacom. The company was recently hit with a $550,000 FCC fine for Janet Jackson's breast-baring Super Bowl escapade on CBS.
"Viacom's back was up against the wall," Stern said. "They are fighting for their lives."
Powell said in an interview yesterday, "It is not surprising that notable performers and journalists are turning to a medium that allows them to paint with a broader palette."
More programs and performers will migrate to pay cable and satellite channels unless Congress holds them to the same decency standards as broadcasters, Powell maintains.