Sirius and Stewart to Create Channel

Sirius Satellite Radio Inc. said Monday that it planned this year to launch a 24-hour radio channel with Martha Stewart Living Omnimedia Inc., with active involvement from Martha Stewart.

Martha Stewart Omnimedia Vice Chairman Charles Koppelman said the four-year exclusive agreement with Sirius would be worth $30 million to his company. Sirius will make payments of about $7.5 million each year to Martha Stewart Living.

The channel will be part of Sirius’ regular service, which costs subscribers about $13 a month. Sirius had 1.24 million subscribers as of January.

Sirius, which has been recruiting top personalities such as rapper Eminem and cyclist Lance Armstrong to compete with bigger rival XM Satellite Radio Holdings Inc., said it expected to boost subscriber growth and advertising revenue by attracting women to the channel.

“It will have a great appeal to women, who are completely underserved by terrestrial radio,” said Sirius Chief Executive Mel Karmazin, who added that the channel could reap significant advertising revenue.

The companies plan to share ad revenue from the channel but declined to detail how the revenue would be split.

The channel will probably launch this year, after Stewart completes her sentence after a conviction last year of lying to investigators about a stock sale.

Analysts said it might be hard to translate Stewart’s lifestyle tips -- which include tending flowers, planning dinner parties and organizing closets -- to the audio-only world of radio. The companies noted that Stewart had recorded brief syndicated radio clips.

XM passed on a deal as Martha Stewart Living asked for a price that made little economic sense, XM spokesman Chance Patterson said.