SiriusXM Brings Free Ad-supported Radio to Cars

During its Q2 2024 earnings conference call, SiriusXM announced a seismic shift in the company’s subscription model that could reshape the audio battle for the car dashboard. In an attempt to gain an edge over its AM/FM and streaming competitors, SiriusXM launched an ad-supported in-car subscription plan it’s calling Free Access.

The Free Access plan will feature ads on select music, talk, sports and comedy channels, and subscriptions will be available through the vehicle dashboard without providing any financial information. However, there are a few major catches to the system.

Free Access only works in vehicles that include SiriusXM 360L hybrid radios and is currently available by invitation only. 360L-enabled radios are currently available in a limited but growing lineup of vehicles from Cadillac, Chevrolet, GMC, Ford, Dodge, Subaru, Volvo and Nissan. The subscription is also valid for one vehicle only and cannot be transferred from car to car or accessed through the SiriusXM mobile app.

And then there’s the all-important caveat: To maintain a subscription, users must use the service at least once every 60 days. Failure to do so will result in automatic — and permanent — deactivation of the service.

SiriusXM Free Access comes as the company struggles to grow its subscriber base and reach more, especially younger, ears with its product. Edison Research’s latest Share of Ear study shows that the satellite broadcaster has only gained 1% of listening time among Americans ages 13+ over the past decade. The platform (8%) lags behind AM/FM (36%), Streaming Music (20%) and now YouTube (14%) and podcasts (10%).

In the second quarter of 2024, SiriusXM’s paid subscriber base fell by 100,000, with vehicle-related churn rising and streaming add-ons declining. The number of paid subscribers for promotional services fell by 73,000, largely as automakers opted for free trial subscriptions. Total trial subscribers were 7.4 million, down slightly from 7.5 million in both the previous quarter and the same quarter a year ago.