Let the games begin!!!

Sirius XM has been paying radio star Howard Stern more than $100 million per year under a five-year contract that expires next year. So, the next few months will bring some interesting bargaining as Sirius XM CEO Mel Karmazin tries to balance his balance sheet against a desire to keep the self-proclaimed “King of All Media” behind a mic.

First off, while it was Karmazin who negotiated numerous contracts with Stern and his agent, Don Buchwald, when Stern was at Infinity/CBS Radio, the deal with what was then Sirius Satellite Radio was struck before Karmazin came onboard. CEO Joe Clayton was willing to pay Stern big bucks to lock-down major league programming that rival XM Satellite Radio couldn’t duplicate as the two battled for subscribers.

Now, though, Sirius and XM are one company. But Stern is still a big subscriber draw, which is important at a time when new car sales have dropped and it is harder than ever for Sirius XM to sign new subscribers. In fact, subscriber numbers have been dropping.

At a Reuters Media Summit last week, Karmazin was asked about the upcoming contract renewal talks. He told reporters that the bargaining would begin with Stern complaining that he was working too hard, doing too many shows and not making enough money. Management, on the other hand, would ask him to do more for less money. But Karmazin said he hoped the result would be a new deal to retain a star he called “a talent like no other in radio.”

One reporter asked whether Stern or Oprah Winfrey was the tougher talent to negotiate with, since Karmazin had done deals with both. “I’ll tell you who was the worst negotiator: It was always Mel because they got all that money from me,” Karmazin quipped at the Reuters gathering.

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