While this may not be an apples to apples comparison, it brings up an interesting situation as to what is the best value for your entertainment dollars.   When I purchased my new Tundra a couple of years ago, it came with six month service of satellite radio for free.    While I enjoyed the satellite radio, when it expired I didn’t subscribe to the service because I thought the value proposition was very poor.

At the time, the only pricing option if I remember correctly was $14.99/month for all the channels and I couldn’t justify that expense when my commute was only 20 minutes.     Today, XM seems to have tiered service with pricing options from as low as $2.99 to $16.99 and I find it ironic that $2.99 is the low end because that’s about as much as I would be willing to pay for the full service.

Here’s the real problem with satellite radio: it competes with too many alternatives that are far cheaper.    If I want to listen to music I can listen to the radio, hook up my ipod or if I’m daring, hook up a laptop or a future iPad with access to music streaming.    Worse yet is that if Netflix can offer streaming entertainment for $8.99 for an all-u-can-eat buffet style then why is satellite radio prices at $16.99 on the high end?

I don’t think the future bodes well for satellite radio unless they change their business proposition.   When I buy my iPad later this year I’ll hook it up to an all you can eat Virgin Mobile Wi-Fi router and get streaming entertainment in my car and that’s a very persuasive entertainment proposition.