Mel Karmazin, who led media giant Viacom Inc. as president until this year, is taking over as president and CEO of struggling Sirius Satellite Radio Inc. He will succeed Joseph Clayton, who remains as the company's chairman.
Clayton said in a statement that with his contract ending at the end of 2004, he was willing to stay on in a "transitional period. When Mel left Viacom, we all felt we had a unique opportunity."
The move follows the $500 million blockbuster deal Sirius struck with shock jock Howard Stern, a Karmazin ally who defended his former boss when Karmazin resigned from Viacom in May. Karmazin left Viacom after four years of what The Wall Street Journal characterized as "constant tension and sniping" with Viacom Chairman Sumner Redstone.
Stern signed his landmark 5-year deal with Sirius in October. It gives Sirius exclusive rights to broadcast his provocative radio show -- free of government oversight -- starting in 2006. Stern has been publicly discussing the possibility of leaving early.
In a prepared statement Thursday, Karmazin said: "This is a perfect opportunity for me because I want to lead a growth company that can reshape the landscape of the radio business."
Sirius offers radio programming with commercial-free music channels to motorists for $12.95 a month. Since it began broadcasting two years ago, the New York company has trailed rival XM Satellite Radio. One reason is that part-owner General Motors vigorously promotes XM.
But Sirius is starting to make progress. In October, Ford Motor Co. announced it would offer Sirius as a factory-installed option on as many as 20 models in the 2006 and 2007 model years. Ford now offers Sirius only as a dealer-installed option on nine models.
Sirius receivers also are available in vehicles sold by the Chrysler group, Volkswagen, Audi, BMW, Porsche, Nissan and Infiniti.
Sirius hopes to sign up at least 1 million of Stern's estimated 12 million listeners -- an audience made up largely of 18- to 49-year-old men. As of Sept. 7, Sirius had more than 600,000 subscribers. The company says it wants 1 million by year end.