Over nine months after the two satellite radio companies
announced their intentions to merge, XM and Sirius may finally find out the fate of their plans today, if the Justice Department issues a ruling as is being rumored. Orbitcast reports that the general consensus among industry watchers is that the DOJ will hand down a decision before the closing bell on Wall Street -- a prediction further buoyed by Bear Stearns analyst Robert Peck, whose contacts in DC claim that a ruling is "imminent." As you're probably well aware, this proposed marriage is no ordinary merger, with strong opposition coming from
terrestrial broadcasters who cite anti-trust concerns, but who are really just fearful of the market power such an entity would yield. Stay tuned for further updates as this story develops...
posted Dec 3rd 2007 10:15AM
I don't use them so I don't care but for those who do. Expect increased prices due to satellite radio is already monopolized by XM/Sirius. And you'd wonder how Anti-trust laws would allow such things to happen. If AT&T can get back together, anything can happen.
JAmerican
You couldn't be more wrong... More content, more pricing options (including lower prices) equals a win for the consumer. As a Sirius subscriber of nearly 4 years I am very excited and hope the merger is approved.
Don't believe me?
XM - Sirius Press Release about pricing
(warning address is a PDF)
http://www.siriusmerger.com/uploads/ala-cart-Press-Rel-7-23-07.pdf
I also have to disagree with you JA about the higher prices. If anything, this will keep prices lower. Howard Stern signed a 1 gillion (is that a real number) dollar contract to go to Sirius. You know there was some kind of bidding war going on, like there probably was for Oprah, and Opie and Anthony and for the rights to MLB, NHL, NFL and NBA games.... the point is, as broadcasters jump the terrestial ship, they'll go to the sat caster for a fair contract, not some bloated A-Rod sized contract because two sides are throwing out the biggest possible number they can fit on a check.
Besides, there are no annual contracts, so if the prices go up just cancel.
"Expect increased prices due to satellite radio is already monopolized by XM/Sirius"
More like the opposite. If the merger fails and both companies continue to hemorrhage money, the would most likely increase subscription costs and/or cut content to stay out of the red.
The cries of monopoly are equally absurd, especially when they come from the NAB. The NAB says they are not in competition with Satellite, yet they are the most vocal lobbying group fighting to stop it. Well it's a good thing the NAB is looking out for the consumers when they have no vested interest in any merger. I look forward to seeing them spend millions preventing the merger of oil companies, Electric utilities or food manufacturers as well.
Why would they? It would be completely stupid to do that. What they need is to establish the most marketshare they possibly can. The day we get a semi-decent and reliable connection to our cars satelite radio has major competition.
In fact, I predict a price-drop in the wave of press they'll get off this merger, to stimulate sales.
C'mon $9.99! and $4.99 secondary subs!
So basically what I get from all these comments is that corporate monopolies are good? Wow, did I die and go to hell? I guess Coke and Pepsi should also merge. The whole point of not having monopolies is that competition can flourish. If there is a monopoly. It sets the market price of a particular product. What would cause or even stop XM/Sirius from increasing the pricing of their service. There is no secondary party for consumers to rely on for lower prices. W/E I just think its a terrible idea to allow companies who already together own most of the satellite radio market to merge.
As a satellite subscriber, I wish there was something I could do if the prices get too high after the merger... hmmmm.
The breaking up monopolies is intended to protect the consumer. In these circumstances, no one needs protection from anything. If you don't want it, don't buy it. There isn't anything that you get from satellite radio that you can't get anywhere else. I pay for the convenience factor.
You should find it ironic that the same government that has debated this issue for so long is continuing to allow the conglomeration of free media in the hands of so few companies. You want to be concerned about something, be concerned about that.
JA, you've already stated that you don't listen to satellite radio.. What do you listen to on radio? Personally I prefer my local stations over the airwaves, they're a free alternative to satellite radio. Sure, there's commercials but its FREE and doesn't require new hardware and clear skies. (sidenote: do satellite radios suffer from rainstorms like satellite TVs do?)
Anyway, the point of my post is Satellite radio can be controlled by one company without being a monopoly. Your argument is like saying McDonalds has a monopoly on the Big Mac. Its way too specific.
Hey, I haven't even mentioned HD-radio. Imagine that.
Nope, they will go up. Sure, everything is going to be spun to make it look like the prices are going to be low low low, but give it a year or so, and they will be pushing the subscribers to the breaking point. Also, regardless of who you're a fan of, don't think that O&A and Ron & Fez are not going to get the shaft. I'm not trying to start a radio war (I was a HUGE Howard Stern fan during the Billy West and the Pre-Divorce years), but O&A would be cut just due to spite, as Mel K. does not like the boys.
I have to take a break from jabbing this pen into my left eye to reply to some of these posts. How can you not understand that these satelite radio companies don't just compete with each other, but compete with anything fighting for your attention while driving in your car? You have FM, AM, iPods, CDs...If Sirius were trying to take over ALL of that, then we'd have a monopoly on our hands. But you have OPTIONS. I love everyone acting like what Sirius wants to do is jack the price for thier service as soon as this goes through, like all of their subscribers are held captive to pay more. Uh, won't we just cancel our service? What company sets out to intentionaly piss off their customers?
Think the NAB would protest Coke and Pepsi merging? Nope. Why? Because they don't compete with those companies. So why do you think they're getting involved with this merger? Go on, think about it. Take your time. Ah ha! Because they are COMPETING with both companies. Doesn't a monopoly refer to a situation in which no competition exists? The NAB knows that both companies together would be bad for them and good for Sirius, and by extension, the subscribers. If the NAB "knew", like some of you in here seem", that the merger would spell the doom of Sirius and their competition, wouldn't it make sense for them to step aside and allow the merger to go through? What do you know that the NAB doesn't?
This message brought to you by Clear Channel.
In most cases you can get a radio free, if you don't already have an existing compatible one in the vehicle already. The only thing that you purchase is the subscription. If the subscription gets too high for your tolerance, you simply do not renew it. The power of the consumer is the way to curb any suspected monopolies. However, as you can see by the amount of flack that is coming from terrestrial radio.............. I can't see how anyone can believe that this is strickly a monopoly of satelite companies. There is a whole lot of competition from terrestrial, I-pod, cellphone (I-phone), etc.
I'd rather give my money to XM/Sirius than Clear Channel.
If XM improves their programing and added some Gandu songs and Gandu comedy they may be allowed to merge with Sirius and Howard Stern....
Bababooee to you
Gandu Gandu Gandu
I agree with you, JA. This is monopolistic b/s and these people saying that the prices are going to go down are illogical to the point that I wonder whether they're Sirius/XM employees. To "Just because one company controls everything doesn't mean it's a monopoly" man: Funny joke, but let's try to keep the conversation serious here.
Enough with this already! Let’s just get it done! If the same amount of time was spent on MORE IMPORTANT ISSUES (LIKE THE DECISION TO INVADE IRAQ) we wouldn’t be in this BILLION DOLLAR A DAY MESS (that me, you and your children will pay for now and well into the future)!
Sorry, kinda got off topic. Ok, let’s see now:
- Radio AM
- Radio FM
- Radio HD
- Pod Cast
- Internet Radio
- CDs
- iTunes
- Rhapsody
- Napster
- Yahoo Music
- MP3Sparks / AllofMP3
- Bittorrent
- DirecTV Audio streams
- Dish Audio streams
- Sirius / XM
Wow! That some monopoly you got there Sirius / XM.
Come one FCC / DoJ even a 6 year old with a lollypop and internet access knows this is not even close to being a monopoly given the multitude of content sources (a 10th of which is listed above). I’m just saying.
Also you, yea you (RIAA) you should be all over lobbying on behalf of this merger ASAP! Why? Because a Sirius / XM merger offers you and the Artist the ability (and another avenue) to collect revenue for your works! Yea, let Clear Channel and the NAB continue to “out lobby you” with there conflict of interest, smoke and mirrors arguments (leaving you at the mercy of the Pirates). SCHMUCKS!
I somewhat agree that this merger isn't too harmful for the industry, but I think some of your examples could be flawed. Just because someone accesses "music" doesn't mean it is in the same ballpark as "radio". It would be like saying AT&T buying up all these little companies isn't anticompetitive because I can still communicate by writing letters. "Communication" isn't "Wireless Phone", just as "Music" isn't just "Radio".
However, maybe this merger would drive local markets to get off their asses with this whole HD radio thing. One of the top reasons I hear from people skeptical of adopting sat-radio is fear of choosing the wrong one. A merger removes that fear, and everyone will buy it. Eventually, more competition will pop up in the space as consumer demand it, but right now it just isn't there.
I'm sorry, but as much as I agree with your other points, you loose them all for going into a political diatribe over a non-related issue on a gadget blog. There are plenty of other forums for you to voice your displeasure over the war in Iraq. Just so you know, far more time is spent on the issue of war. Just because the outcome isn't what you want doesn't mean that nothing is being done or no time is being spent.
--On to the actual topic
I'm of two minds on this merger. I like the idea of merging content and technology, but I don't like the idea of one company controlling the entire market. And, yes, they would be, depending on the view you take.
Terrestrial radio and everything else you listed provide competition, but if there is no direct competition in the satellite radio market, prices could easily climb higher for sat rad customers.
There is no way that prices climb significantly with this merger. There are way to many people that are subscribers for now be cause it is relatively cheap and convienent. If the prices went up by more than a buck or two, XM/Sirius would not only be hemorrhaging money at that point, they would be hemorrhaging subscibers.
Most of those that you listed were MP3 players, or places to get MP3s. DISH and DirecTV both use satellite radio for their streams, so that's out, and AM/FM/HD terrestrial is practically the same thing.
Last time I checked, you couldn't get a radio that had a "bittorrent" button.... although you already proved yourself to be a fool by posting a completely irrelevant comment. In other places, we would call you "flamebait" ;)
not to get political but invading iraq was discussed for 15 years. Doesnt make it a good idea anyway.
I dont work for the RIAA but as a consumer i am concerned over anti-trust laws. I just don't see how this is legal.
Both stocks are up today...probably means that the DOJ has already made a decision but it's not official.
I'm looking forward to turning on the XM in the Honda. I just hope prices down go any higher than they are now.
If they merge, I don't want to lose my Ethel! (XM47)
Love XM 47! They better not!
As a long time Stern fan I have heard him speaking about this for 6 months but I still think that there are only TWO companies providing country-wide digital music through satellite and combining them is a mistake.
Currently both compete to grab content that will bring in subscribers.
Do you think Howard Stern would have gotten a $500,000,000 deal if Sirius had not been competeing with XM?
How about the NFL? Baseball? Do you think teh new merged company will be paying teh same price next year for the contracts?
Sorry, but the merger is a bad idea for everyone EXCEPT the two companies.
What do you care how much Howard gets, or how much the new company will pay for licenses? What's in it for you huh? Bottom line is, subscribers will benefit by having more programming choices, and/or lower subscription fees.
well when both go under for bad business decisions then he will care.
They overpaid for talent and now it is biting them in the ass!!! Both XM and Sirius need the merger to stay afloat or some other company such as Viacom may come in and buy one (once they go bankrupt)
"Do you think Howard Stern would have gotten a $500,000,000 deal if Sirius had not been competeing with XM?"
I'm not sure what exactly you are getting at, but it sounds like you are saying he would have gotten paid less if there was only one company bidding for him. Same thing with sports. If two companies aren't there to outbid each other, wouldn't the price be lower?
Isn't spending less on content better for the consumers than the company having higher expenses?
There is programming I like on XM and Sirius. If I want them both I have to pay two full subscription prices. With the merge I can hear those shows with only one. That is not a bad thing.
Ping, you made the opposite of your point. If Howard Stern didn't get a $5000000000000 contract, we wouldn't have to pay an extra dollar each and still listen to commercials on the show.
Maybe if XM and Sirius didn't have to compete by having a bidding war over sports broadcasting rights, they wouldn't be making money and could keep rates low and not go bankrupt.
I have to agree with PingMeister. Does Sirius need XM or is it XM needs Sirius? If the merger is successful, there would be new pricing packages, such as $24.50/mnth to get Stern and the Best of Whoopie Goldberg. Meaning the best of satellite will be packaged with crap and the price is jacked. Because they compete shouldn't mean I should suffer their poor investments i.e. could they have gotten rights for less? Howard Stern may be leaving in 2 - 3 years any way.
The commercial free is going to go away as well without competition, they won't have to worry about losing subscribers without an alternative and hence up their revenue stream.
my only concern is that sirius turns XM into a pay top 40 station. please keep the stations the way they are! (i'm sure sirius listeners would agree)
Well, for all of you who don't believe in the monopoly XM/Sirius satellite radio will become with this merger, just try to get cable tv, internet, or phone service from a company in your area other than the one that has bought out your local politicians. When local governments sign exclusive and long term contracts with cable, or phone companies, they screwed their residents. When there's no competition, consumers suffer with abusive business tactics, poor customer service, and inexplicable fees.
I think this merger is bull. Sure things will be rosy at the beginning. But, hang on tight because once the companies know that they have no other competition in the market, then the abuse starts. Just pick any big corporate gorilla in any market and you'd see the same scenario taking place.
This is in no way similar to the monopolies created with cable and internet.
Satellite radio is not the only company offering radio services. If they raise prices people can always go back to FM radio or HD radio. The option to listen to music for free is always there. You may have commercials, but the same songs can be played on both satellite and terrestrial radio.
This is not the same with cable. You cannot watch ESPN or MTV, etc. without a cable subscription. You cannot access broadband internet speeds without paying for it. You have to settle for something sub par like dial up or broadcast TV.
Satellite radio is already struggling to gain subscribers since a free radio service is available. It would be self-destructive to increase prices. There are too many other music options available that would prevent them from being successful in that manner.
I am a current subscriber looking forward to what could come from this merger. And as a subscriber, if they chose to raise prices, I would quickly drop my subscription and just listen to my MP3 player in my car. And I am pretty sure most subscribers would do the same.
I totally agree with Rob. In the beginning, things will be cheaper but look out for the long run.
My biggest gripe with most monthly subscriptions we pay for is the cable company. It has to be the most overpriced monthly service these days.
Also, what about cell phone plans? Ever wonder why people love staying with "grandfather" plans? Hmm..
No one is forcing you to have cable tv. However, if they have the content you want then you'll pay for it. You could always just rent the dvds of the shows you want or watch them on the net.
Again, if this merger caused the prices to increase there is enough other non-satellite competition/alternatives for people to easily switch. People will speak with their dollars... or would you rather just whine about it and continue to pay even though you aren't happy with the service?
In the long run? In the long run the price of a ford went from $300 to $30,000. All things go up in the long run. Right now, I'm more interested in what service I get for the money I do pay. If I don't like the service I do without.
Really, why does everyone expect this will mean MORE content? Do you not believe that a combined XM/Sirius will start cutting duplicate channels as soon as they can - especially those speciality channels?
heres an idea, when the "abuse" starts happening, CANCEL YOUR SUBSCRIPTION. this is a luxury that you pay for. if you belong to a club, and the club starts pissing you off, you leave the club.
i for one think this will be good for the consumers, as i can now get access to the NHL which is XM only, and keep listening to howard every morning.
So if they do merge and create a monopoly and raise prices as some fear, do you really think they could raise it to $20/month and expect people to pay that? Bottom line is they need new subscribers and they wont get that at $20/month. I say bring on the merger so I can get NFL and MLB on one service FINALLY.
Its been a fun 3 years but i cant wait to save 12.99 a month when and if they merger.
I refuse to support Mel.
And it wont happen today. History shows the DoJ makes statements like this on Wednesdays.
Honestly I don't care how much it ends up costing me...anything is better than the absolute crap available on FM radio in most markets. I just moved back to Atlanta and in the five years I was gone every radio station in the city changed to basically the same format, playing the same 25 songs over and over (when they do occasionally play music..most of them just spew mindless blather and commercials around the clock). I've been an XM subscriber since 2001 and the few days I had to endure terrestrial radio in a rental car here was enough to convince me that AM & FM are better off dead. Bring on the monopoly!!!!!
I'm sure if Rupert Murdoch or a monopolistic oil cartel were involved -- the merger would have been ok'd in a blink of an eye!!!!
"So if they do merge and create a monopoly and raise prices as some fear,"
I fear it. Its been said that all contracts need to be redone. With double the subscribers im sure the MLB, NFL, Howard, Oprah... Martha Stewart.........Sirius's Gay Channel........ Sirius's Blue Collar Radio........., and other POINTLESS content offered will want more money.
So a price increase sounds realistic. All i want is my XM music and Ron and Fez.
Monopolies exist in the absence of choice. Oil, electric, gas, and water companies are all in this category. They get to set rates and we pay them with no choice.
Heating oil, cable tv, telephone, and satellite radio are not pure examples of monopolies since there are alternatives.
Also, these companies are showing terrible losses and very bad financial performance since they started because of the competition between XM and Sirius. As a result, they are bloodied and ready to perish without some sort of intervention. For those of us who subscribe, we would be harmed, but not devastated by the loss of satellite radio. We would just flip to terrestrial radio instead.
I would say that we should be more worried about the consolidation of the content providers in media (e.g. Fox) is a scarier prospect than satellite radio consolidation.
Quick FYI, Cable IS a monopoly in many areas of the country. The area that I live in has NEVER been able to pick a cable company. And no, I don't live in some country city in the mid-west.
Also, I want to keep my deep tracks (XM49) and for my daughter XM116 and Sirius kids!
I'm down with the merger. I heard XM programming (in some genres) is better than Sirius. I am currently a lifetime member of Sirius and have no issues... but being able to get some XM channels is a plus.
The only issue I have right now is... there is NOTHING written about the lifetime member. What happens to us? Do we get XM programming too?
My family uses both so I hope the merger does go through since it would end up being a decrease in my monthly fees.
Also I'm curious as to what the channel line up will be? Will they combine the content so that I can listen to MLB games on my Sirius unit? I can't imagine they would keep 2-70's, 80's, 90's, channels, and how would the on air personalities be handled? I prefer the personalities on my Sirius unit as compared to my wife's XM unit, not to mention that I do not like the commercials on the XM unit.
Maybe they will have a lower priced service for people who are willing to listen to commericals as compared to commercial free service or you could subscribe to a lesser amount of channels kind of like cable/satellite TV.
Either way I think it's a win, win for both companies as they will not be able to survive on their own.
While I do think that there are bigger merger issues overall (satellite radio is a niche market at best) I can't see any way this merger will create a better overall single company.
Sure, XM and Sirius have to spend a lot of money competing for programming-- what will they do when they no longer have to compete? What incentive will they have? If you want coast-to-coast satellite radio, get XM/Sirius or nothing. With all the promises they've had to make (not making any radios obsolete, especially) they are going to have a pretty big tightrope act. And adding "best ofs" to lineups (i.e., Stern/NFL onto XM radios, Oprah(?)/whatever to Sirius) is only going to make the bandwidth crunch worse on both services, resulting in lower sound quality, and/or the loss of other channels.
Oh well, XM's sound quality (or lack thereof) is very close to losing
me as a subscriber, if this merger ends up being a mess I'll be gone. I don't care enough about Howard Stern to consider it a "plus" and if I lose a favorite channel to get 24/7 Howard I'll be fairly unhappy. I've been a subscriber to XM since 2003 but it seems like they've been going the wrong direction over the last couple of years. I'd like to think I'm wrong but history shows less competition almost never makes a better product. For everyone saying how great the merger is, let's give it 1-2 years (after the merger is completed-- so maybe 3 years from now)-- I bet you'll be paying more than you are today (more than rate of inflation increases), or won't be getting the same selection you are now, sound quality will be worse (to accomodate all the added channels), and probably at least a few of your favorite channels will be gone or drastically changed.
The only way I would've supported this merger is if they had promised increased sound quality using the combined bandwidth of both systems (and/or dropping redundant channels). But sound quality is one of the few things I haven't seen addressed very much, if at all, in the merger information.
Funny that, listening to music and wanting decent quality. (for reference, I'm not being an audiophile snob, XM in 2003 sounded absolutely fine to me, but it's never recovered after the March 1, 2006 drop)