Stern Vows He'll Rise Above FCC

In an announcement heavy with his trademark immodesty, Stern, billing himself as "radio's biggest star," said his popular morning talk show would switch in January 2006, from Viacom Inc.'s Infinity Broadcasting to Sirius Satellite Radio, where the heavily fined broadcaster could at last escape Federal Communications Commission scrutiny.

With the new five-year deal, Stern, one of the nation's top three radio talk show hosts, becomes by far the best-known broadcast personality to migrate to satellite radio -- and the first with the potential to catapult it to mainstream popularity.

But the Sirius deal is fraught with risks for both sides. Stern, who has referred to himself as "the king of all media," is trading his vaunted broadcasting perch for a role at a niche "satcaster" with just 600,000 subscribers. The host, who reportedly earns $20 million a year at Infinity, could wind up a forgotten and isolated figure if large numbers of his core fans fail to follow him to satellite.

Money-losing Sirius, which along with its larger archrival XM Satellite Radio has struggled for listeners and financial stability, is betting heavily that Stern will bring 1 million new subscribers -- nearly tripling its current audience. Sirius will pay $100 million annually for Stern's show, which includes salaries for him and his crew as well as the costs of building a new studio and promoting the show.

Stern, 50, painted his move as an era-defining shift.

"I'm leaving radio -- this kind of radio -- and I'm going to the future of radio," Stern told his listeners. "I think radio the way we've done it is becoming obliterated."

The media landscape has been shifting beneath Stern's feet lately. In addition to fighting the indecency battles, he is attracting a much smaller audience than he did in his mid-1990s heyday. Stern's nationwide audience has slipped from an estimated 17.5 million in 1998 to 8.5 million this year, according to Talkers magazine, the trade journal of the talk radio industry.