Terrestrial Radio Execs sound off on Sirius, XM merger
Wednesday, February 21, 2007 at 1:49 PM
Tags: 2, XM
My favorite radio publication, Inside Radio, polled some radio CEOs about the Sirius-XM Merger. Guess what they had to say? Nothing but good things, of course...
Cox Radio CEO Bob Neil says "If it is approved, and I don't think it will be, it would be one of the most anti-consumer mergers ever allowed in business."
Triad's David Benjamin says "It further confirms that the business plan for satellite radio is just not working. No one was talking about a merger before subscriber targets and break-even points were being missed," Benjamin added "The two big winners in this are the investment bankers and the lawyers."
Connoisseur CEO Jeff Warshaw said "I can't imagine that it's in the public interest. It would be tantamount to a government bail-out of an industry (satellite radio) that has been ridiculously mis-managed. It is inappropriate for local radio to be disadvantaged by such a bail-out."
...yet the curious thing is that in SEC filings (e.g., CBS Corp's 10-K) made by terrestrial radio corporations, it's clearly stated that satellite radio is in direct competition with terrestrial; as is Internet radio and digital audio players. That opens up the argument that satellite radio is part of a greater audio marketplace.
Can't have it both ways boys. Either we're competition, or we're not. But since it's already in your filings, which constitute admissions under the law, then you've already defined the marketplace for us. So thanks.
Thanks Mark!
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Comments
Great find Ryan.
Was there ever a doubt that terrestrial radio wants it both ways. :)
Posted by: Another Thought | February 21, 2007 2:26 PM
imagine if they did merge though.....
-complete package of the sickest content in music, sports, and talk. (Censored things like playboy OandA and Stern - which could never be brought to you any other way
-Eventually maybe they would reach global markets
-Innovative electronics like video-gps-weather-social netowrking all in one developed elecronic.
-Super fast growth and product integration. (gaming systems-cellphones-ipods-women's vibrater...
I think its worth just a little each month. Im sure people are paying like 100 dollars already for cellphones.
Posted by: dave | February 21, 2007 2:53 PM
How exactly - before an interoperable radio - will I be able to get MLB and Howard Stern? I am still confused by this. Say I have an XM device and I select the Howard Stern package, my radio still will only receive from the XM birds and their capacity has not gone up. So do they backhaul the Howard signal to XM in DC and then uplink it to the satellite, then I can receive it on my radio? But then what do they do with the all the other stations - there is no capacity.
Sorry if I sound like I am going in circles - but I don't see any way that this works without a loss of NON-Redundant channels - at least near term - next 3-5 years.
Posted by: Miss the 8M | February 21, 2007 4:19 PM
This issue about how terrestrial radio has inadvertently made a case for support of the merger by recognizing satellite radio as a competitor is discussed in detail in an article in today's (2/21/07) Wall Street Journal.
I'd like to make another point about the competitive marketplace issue that the government will be considering in the coming year. I think the government needs to look very closely at making a distinction between different technologies being *alternatives* to one another versus being *competitors* with one another. If you look at all the options that consumers now have available, terrestrial radio, satellite radio, HD radio, iPods, etc., etc., I don't think anyone would argue with the fact they all server as alternative sources of audio entertainment. When I get in my car, I can turn on my car radio, my satellite car radio, or I can just choose to plug in my iPod and listen to it over my car's audio system. However, when it comes to competition, I think it's a different matter. Who of us who truly enjoy satellite radio really feel that terrestrial radio, with its very limited music formats and endless commercial breaks is really a competitor to satellite radio? Other than the fact that they're both transmitted over the airwaves, I hardly consider them competitors which is why I've all but stopped listening to terrestrial radio. XM and Sirius are only truly in competition with one another. And if that's the case, then a merger would create a monopoly and we consumers would be the worse for it.
Posted by: Robert | February 21, 2007 4:36 PM
And by the way, to address Dave's comment about uncensored content, the WSJ article which I cited above also mentioned that, in order to receive FCC buy-in for the merger, the FCC could require that Sirius/XM put content like Howard Stern and Raw Dog on an adult tier. I could see access to this tier requiring an extra charge. As I said yesterday, I see subscription prices going up by at least $2 a month within the first year of a merger. With both companies bleeding red ink, I don't think they'll have any other choice.
Posted by: Robert | February 21, 2007 4:41 PM
NO... NO... NO NO NO... JUST SAY NO TO THIS MERGER.. I fully intend to write my congressman and make him know that this will not be tolerated.. there should be two satellite radio companies... and if they merge there will be ONE, RIGHT? well for a short time there will be one.. then there will be none.. and then in a few years after all the bankrupt and finger pointing is done will there be anyone stupid enough to try satellite radio again?? HOPEFULLY NOT!!!
Posted by: steve | February 21, 2007 5:33 PM