SIRIUS SATELLITE RADIO SERVICE DELAYS LAUNCH AGAIN

Second Postponement as CEO Resigns

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NEW YORK (AdAge.com) -- Sirius Satellite Radio has again postponed the consumer launch of its radio service, saying it needs to expand its testing to six additional markets to further evaluate radios, transmission, distribution, installation, sales support and customer service.

This is the second time this year the subscription-based radio service has delayed its launch. Sirius previously pushed back its original launch date from late spring or early summer to the fourth quarter due to manufacturing problems that forced it to postpone radio shipments to its automaker partners BMW of North America, DaimlerChrysler and Ford Motor Co.

A new date has not been set. The company said it will update investors about the launch status in a conference call Nov. 14.

'Testing phase'
"We can't give a window right now" as to when the launch will

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be, said a Sirius spokeswoman. "It's essentially a testing situation. We want to and have to and need to expand this testing phase, and we don't want to launch before we've finished that.

"Everything on the advertising side will coincide with the product launch," the spokeswoman added.

Sirius shifted its estimated $100 million ad account to Interpublic Group of Cos.' McCann Erickson Worldwide, New York, from Omnicom Group's Goodby, Silverstein & Partners, San Francisco, last month. It consolidated its marketing under McCann because its unit MRM Partners, New York, had already handled direct and relationship marketing for the company.

Sirius' competitor XM Satellite Radio Holdings launched its service last month in Dallas/Fort Worth, Texas, and San Diego. XM's service is scheduled to roll out nationwide throughout this quarter, backed by ad campaign from Omnicom's TBWA/Chiat/Day, Playa del Rey, Calif.

CEO steps down
Sirius also announced today that CEO David Margoles is stepping down, as planned. Mr. Margoles started the company in 1990 and spent a decade lobbying the Federal Communications Commission and raising money to develop the company's infrastructure, the spokeswoman said.

"He's always been planning to move onto other things," she said, adding that now was the right time because the company is transitioning into a new phase of entertainment and service.

John Scelfo, senior vice president and chief financial officer, and Patrick Donnelly, senior vice president and general counsel, will assume Mr. Margoles' duties until the company finds a replacement. Mr. Margoles will remain chairman of the board.

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