Which side of the merger fight is "winning"?

Tuesday, July 24, 2007 at 3:17 PM
Tags: 2, XM

There's an interesting article in Seeking Alpha today by M&A Researcher about the new pleading cycle involving the 1997 SDARS rule. But what really struck me was the comparison between the sheer number of FCC comments, versus the "weight" of other comments.

"The vast majority of analysts (professional and amateur) continually fail to accurately weigh the comments in terms of significance, instead falling into the trap of literally counting the supporter/opponent filings as if the FCC will do the same. While the FCC is surely aware of the tally, it is certainly much more interested in the nature of the comments, and more importantly, from whom the comments originate. It can not be stressed enough, even at this early stage, that the opponents involved so far have far more clout within the D.C. beltway than do the supporters. This too is subject to change in the coming months."

If you look at the FCC Comment Scorecard (courtesy of SiriusBuzz), you'll see how the "pro" comments are definitely outweighing the "anti" comments.

Sirius-XM FCC Comments

The point that M&A Researcher is trying to make (though they seem rather proud about it) is that the influence of the anti-merger camp outweighs the number of pro-merger comments.

Which, sadly, all goes back to politics. It's disgusting to think that pressure from politicians (who are only looking out for their constituents campaign contributors) would outweigh the opinion of the majority. But hey, it's all in the name of the "public interest" isn't it?

[Seeking Alpha



What MA Researcher fails to recognize is the merit of the arguments being made, rather than who is making them (on the con side almost entirely NAB or their supporters). They also fail to recognize that the DOJ people reviewing the merger are professionals, not politicians. The FCC may be influenced by politics, but they have never ruled against the DOJ. Besides, Ed Gillespie now works directly for GWB -- if politics matter -- and he will be returning to his lobbying firm, which represents Sirius and XM, in about 18 months.

Also remember that as much as the NAB has been fighting against satellite radio over the years, they have lost every battle, despite the NAB's influence.

Have you read any of the comments submitted. Many are along the lines of..

"I want MLB on my Sirius." Joe Sirius Share holder and subscriber

Comments like this never addressed the issues the FCC was seeking comments for.

Add on top of this the retail Sirius shareholders outnumbering XM retail share holders by a bare minimum of 214 to 1 and the 80% pro merger on 3000-4000 total comments is quite pathetic. Infact with 14 million Sat Rad listeners .. 4000 comments for or against is also pathetic.

"What MA Researcher fails to recognize is the merit of the arguments being made, rather than who is making them (on the con side almost entirely NAB or their supporters)."

I think it pretty simplistic to assume the only people against the merger are the NAB. Myself, I like that there are 2 sat rad choices and don't want to see one swallowed by the other. The NAB has looked like a bunch of hypocrytes throughout this process but there is no reason to trash 2 great providers just because it would piss the NAB off.

2 Great providers that might not exist without this merger. Their balance sheets aren't looking so hot now a days.

and you wonder why Congress approval ratings are LOWER then the presidents??(its because the people dont get what they want, the lobby does)

For anybody wondering why the XM/Sirius merger seriously isn’t going to happen, just look at the headlines:

· CBS Buys Online Music Social Network Last.fm
· Sirius Satellite Radio Boss: 'We Suck Less!'
· XM Radio Back Online After Two Days of Outages
(among others that are less than flattering...)

It’s not the “mean old” NAB trying to hold back progress. It’s simply a case of neither satellite service living up to their written agreements. When the Telcom Act of 1996 was passed, the deal was set then for there to be TWO digital satellite networks and the ability for EVERY terrestrial radio station to go digital at some future point in time (unlike HDTV, radio doesn’t have a deadline for going totally digital).

From the time this deal was cut until the present, it has been one long unbroken record of broken promises and agreements with Sirius and XM weaseling out of one responsibility or agreement after another. Whether it was overspending on facilities or talent or offering misleading subscription numbers where people were not “re-upping” after the first free year that came with their new cars, this has been an expensive house of cards that the shareholders of Sirius and XM have paid for dearly.

And the irony of all of this is that, in the end, Internet Radio will overtake both terrestrial AND satellite radio. CBS didn't buy Last.fm for fun. So all the satellite radio hoopla and glitter is long gone and while Mel Karmazin can rearrange the deck chairs on the poop deck of the Titanic for as long as he likes, the simple reality is that the merger will not be approved this year or next for sure. 2008 is an election year and NO politician is going to be standing up for this merger… it just isn’t going to happen.

Dain Schult, Chairman/CEO, American Radio Empire, Inc.

Who's pockets are the deepest??? Who's paying the right people off?? We'll see soon enough..

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