FCC tentatively approves XM / Sirius merger

We basically knew the FCC was going to approve the XM / Sirius merger after the DoJ approved it earlier this year, and it looks like the communications agency is just about ready to sign off -- the Wall Street Journal is reporting that a majority of FCC commissioners are close to approving the deal. Word is that XM and Sirius will have to fork over an additional $20M to make it happen and agree to several enforcement terms, but it's all up in the air until this goes official. Let's hope that's soon -- after a historically long delay, it looks like there's finally some light at the end of the tunnel.

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[SuperSexyErik (^_^) @ Jul 23rd 2008 2:57PM]

yay!! Make an iPod touch app already :)

[Andrew @ Jul 23rd 2008 3:13PM]

plus freakin one!

I want a Sirius app for my iPhone so badly! Who's up to it?

[EricR @ Jul 23rd 2008 3:41PM]

I believe this is the first sensible comment Erik has posted.

[Blue43Fan @ Jul 23rd 2008 4:01PM]

It exists already, it's called uSirius. It's not in the app store yet but I had it installed on my 1.1.4 jailbroken iPhone and it works GREAT.

Another method world be to stream from your computer using Orb, which certainly is not the best option but will get the job done.

[SuperSexyErik (^_^) @ Jul 23rd 2008 5:49PM]

yes but my ipod touch hasnt been jailbroken yet.. plus i want it from the company, not someone who charges for it, like on installer app.

[Andrew @ Jul 23rd 2008 6:12PM]

Yes, but 1.x apps don't work on 2.x, so uSirius is out of the question too until they update it for 2.0.

[SuperSexyErik (^_^) @ Jul 23rd 2008 6:13PM]

... but what im saying is that the company should develop for the 2.0 platform.. much more stable.

[k @ Jul 23rd 2008 3:07PM]

well which is it?

http://news.yahoo.com/s/ap/20080723/ap_on_go_ca_st_pe/fcc_xm_sirius

[Andrew @ Jul 23rd 2008 3:21PM]

At the moment nothing has been decided yet.

It would seem that this article is a little premature.

[Richard @ Jul 23rd 2008 3:32PM]

"a little premature."

It's ok, my girlfriend says that's normal.

[syphix @ Jul 23rd 2008 3:41PM]

That's a link to Adelstein's decision...decision #4 of 5. His vote was NOT the deciding vote: Tate's is. She has yet to officially vote, but stories abound that she will vote "yes".

[Andrew @ Jul 23rd 2008 6:22PM]

Richard: Haha, I knew someone would comment on that.

syphix: Yeah, that's what people have said. But she was also the one who was up in arms about how they went about the merging process in the beginning, so we'll have to see. I'm hoping all goes well, but I don't want to get too excited yet.

[kjb434 @ Jul 23rd 2008 3:04PM]

Finally, but in the end the satellite radio business is dead.

The vast majority of new subscribers are people who get the service free in new cars. And the churn rate on these are high.

Terrestrial radio, CD's, car based hardrives, PMPs, have flooded the market with options that don't require monthly fees.

[Andrew @ Jul 23rd 2008 3:17PM]

You don't think those subscriptions are paid for? The dealer pays for the year subscription (at least is the case with my BMW), and after that, you pay to renew.

And ask anyone who is a subscriber, they'll probably renew. I know I will. Satellite radio blows away any other radio, and the variety it adds can't be gotten from static media (CDs, MP3s, etc). In my car I have Sirius, my iPod, HD Radio/FM/AM, and CD. I listen to Sirius all the time, or my iPod if I have something specific I want to hear. I listen to the radio maybe once a week, and I've yet to ever put a CD in the car.

[kjb434 @ Jul 23rd 2008 3:24PM]

The sound quality argument is lost since HD radio is widely available and your BMW should have it pre-installed. The quality is the same as satellite.

Most of the prepaid subscribers do not renew. XM and Sirrius had to admit that. Both companies have yet to turn any profit and constantly refinancing their debt.

When their investors (the only way XM and Sirrius actually have operable funds) begin to pull away because they are turning a profit, the companies will fail.

I'm not going to argue with the available content and say whether satellites is better or not. I would argue that their business is not working unless they raise monthly subscription fees much higher. They won't do that because customers will leave. This means they don't make money.

Unless you can solve that problem, the companies have to fail.

Are you willing to pay 3 or 4 times as much as your monthly subscription to keep the service from going out of business?

[kjb434 @ Jul 23rd 2008 3:26PM]

When their investors (the only way XM and Sirrius actually have operable funds) begin to pull away because they are turning a profit, the companies will fail.

(I meant to say AREN'T instead of ARE)

[John Smith @ Jul 23rd 2008 4:39PM]

You are yet another person who believes everyone lives in New York City and likes top 20 music. I like jazz and where I live, the only way to get jazz is to pay the subscription which I'm very happy to do.

[kjb434 @ Jul 23rd 2008 4:52PM]

I live in Houston, TX and have three free stations that play jazz music. Two are full time and one is in blocks.

Maybe you should move?

People need to realize that satellite radio WILL slowly start adding advertisements because they can't afford to not do it. They both even admitted that it's a possibility if they don't become profitable with subscribers only.

In the end, I'm not arguing over quality or choice with satellite radio. I'm arguing that they can't continue to exist unless they turn a profit.

[Izzy @ Jul 23rd 2008 5:06PM]

Sirius is great and for anyone who lives in the boonies where they have one AM country station, it's a Godsend!

HD radio is a good option as long as you live in their market areas but for people who drive long distances or want a consistent station no matter where they are, satellite is the best option.

[Andrew @ Jul 23rd 2008 6:21PM]

I wasn't arguing quality. Hell, HD radio and Satellite radio are barely any better than a good FM signal is. FM isn't really that bad if you have a good signal. And HD radio is only available on about 3 stations here, and I don't really like any of them.

I like the stations and the variety and the ability to listen to only one type of music. I mainly listen to Octane (hard rock) or Lithium (90s alt). The alternatives are mainly generic rock stations that play both of those, in addition to all kinds of other music.

I'd guess that the people who don't renew are people who don't even care about music or realize they even have satellite. For those who like music, most would be happy to pay the very small cost that there is to have even one station they really like.

My other point about variety is the ability to listen to news stations, or sports stations, or a variety of talk stations, etc. Sure, not everyone cares, but I can't think of anyone I've ever talked to, who liked music, that isn't happy to pay the fee.

As for the future, anything can happen. You can theorize what costs will be, or if there will be ads, but what matters is what there is now. Once they merge they can likely consolidate costs greatly, and possibly even get more people to renew if their car currently only does one or the other (once they have more station choices). So when costs go up, or there are ads, then I'll think about if I want to continue to subscribe, but for now, It's a bargin in my opinion.

[tbone @ Jul 23rd 2008 3:13PM]

yeah, i mostly just listen my torrent filled ipod connected to my deck when im driving

[JOSE @ Jul 23rd 2008 3:42PM]

i dont know why some think satellite will fail when xm has 10miilion suscribers and sirius has 9million... with both together they will have a better combination of music then terrestrial will ever have also adding to the fact that no AM frequency station will ever top the quaility of sports programing... i mean where else will you get you maxim radio fix..
people think prices might go up when i fact DOJ and the FCC have specifically made it clear that this can not happen if they were to approve the merger on top of the 20million dollar fine they have to pay up before the deal goes thru also keep in mind they will have to provide radio that can receive both signals and also offer an alacarte service where you choose what channels you want for a specific price

[kjb434 @ Jul 23rd 2008 4:47PM]

Jose,

You have no idea what you are talking about. Terrestrial radio has many more listeners than satellite. If satellite approached half of terrestrial numbers, they may stay in business.

The most popular show in the US whether you like him or not is Rush Limbaugh with an average of 20 million listeners alone. That's more than the total subscriber base that splits its listening across many stations. Howard can't even come close to this number alone even when he was on terrestrial radio.

[ishism @ Jul 23rd 2008 10:33PM]

Some people actually like radio personalities. That' is why there will always be a market for this. May not be a large and successful market, but it's there. Too bad the FCC was slowing this down. The FCC should just FCKN DIE already. What the FCK? It's not like they stop the immoral crap that's on TV and the radio. It's getting worse all the time. No wonder kids are turning into whores at such an early age.
P.S. And don't give me this sh!t that "it's the parents fault". They're a product of the crap too.

[CaptCaveman @ Jul 24th 2008 2:53AM]

@ishism

Sorry buddy, it IS the parents fault. And if the parents don't know any better because they grew up on the the trash then it is THEIR parents fault as well. Watching garbage is not a requirement.

[Artie Lange @ Jul 23rd 2008 3:32PM]

I canceled because of the 4 day work-week, endless, unannounced vacations, fake listener calls, and constant plugs for HTV. However, because Sirius is so desperate for listeners and need to pad their numbers, they never turned off my receiver; going on 4 months now for free. I hear that this has become common-place. You may want to give it a try.

I'm an O&A/R&F fan as well (I get XM through DTV), and I'm afraid that they're finished once he merger happens. That's what happens when you monopolize an industry - less consumer choice.

[Dave @ Jul 23rd 2008 3:36PM]

So basically a $20 million bribe will get it done? Our government is so f'ing corrupt.

[ishism @ Jul 23rd 2008 10:35PM]

Seriouly. DIE FCC. You have failed in blocking the crap aimed at our youth. Your useless these days.

[TVGenius @ Jul 23rd 2008 3:39PM]

I hate to break it to you, but this merger is all about cutting costs. Howie will be lucky to see $10M a year if this is approved.

And as an XM sub since they went on the air, I fear that light in the tunnel is Mel K. coming to destroy what I love about XM.

[eddy @ Jul 23rd 2008 3:40PM]

I listen to XM every day and were it not for MP3 CDs in my car, I'd have nothing to listen to on the radio. Terrestrial radio is awful (tried to suffer through it when my XM had to be repaired) and I'd never go back to it. Been an XM subscriber for...shoot, at least four years now?

On XM, I mainly listen to two talk channels (XM Home Ice and The Virus) and one music channel (The Verge) and have no problem paying for the ability to listen. With XM Home Ice, I get hockey talk that I can't find anywhere else. The Virus...well, you have to be an O&A/R&F fan to appreciate it. The Verge, it's introduced me to so much great music (that I inevitably end up buying to support the indie artists) and still continues to.

Business-wise, they're not doing so hot. But quality of service? I can't complain one bit.

[stu @ Jul 23rd 2008 4:21PM]

complaining about howards work week is pretty silly!
He does what a 5 hour show once you take out the small breaks and then the wrap up show is another 1 hour at least.

not many other talk DJ's do 20 hours of live material a week?

[Earl @ Jul 23rd 2008 4:06PM]

They let the big oil companies merge with almost no questions asked and now we have record gas prices...
But our government has no problem wasting almost 2 years on deciding if satellite radio will be a monopoly, when it is not even a required expense.
We have our priorities backwards

[bartoron @ Jul 23rd 2008 4:29PM]

Well durr, I mean after all Bush does love his oil.

I hope this works out well, because that would be awesome.

[gt-racer @ Jul 23rd 2008 4:21PM]

As an XM sub and a Virus fan, I too fear that the bbbboys are done.

[David(Postal) @ Jul 23rd 2008 4:24PM]

Just in time when I am going to cancel my account

[Artie Lange @ Jul 23rd 2008 5:05PM]

Go ahead an cancel - I did, and 4 months later they still haven't turned off my receiver because they want to pad their listener numbers and play-down their churn rate. At the very least, if you call and tell them to cancel, they offer you 3 months for free if you'll stay.

[Pepsipoint @ Jul 24th 2008 12:55AM]

Yes. let's all be cheap fucks and get free XM/Sirius. How about we call the cable company and tell them we don't want them. ask for a week free? Then maybe our electric company? or our gas company? hell. let's all go out and get welfare.

[kjb434 @ Jul 23rd 2008 4:54PM]

The merger will not create a monopoly. Is technically a monopoly among satellite radio providers? Yes. Is it a monopoly is ways you listen to content in your car or home? No. That is the question the FCC and DOJ were answering. The reality is that we have tons of choices of how to listen to content. Satellite is just one of them.

[Artie Lange @ Jul 23rd 2008 5:14PM]

If you define "entertainment" in large enough terms, you can argue that there monopolies are impossible, and we know that's not true.

The satrad merger will create a monopoly. It delivers new (i.e. content you haven't bought or heard previously) uncensored content in a mobile form across a uninterrupted network nation-wide. There are no other products on the market that can do that. Ipod? No; it only allows you to listen to content that you have already heard. Terrestrial radio? Obviously not. The internet? Can you drive while surfing the net? Wifi radio? Can wifi provide seamless coverage across the country? No.

If you support the merger, that's fine, but the argument that it won't create a monopoly is illogical.

[kjb434 @ Jul 23rd 2008 5:18PM]

Monopolies are about removing choice from consumers. The choices of what you can listen to at home or in your car are vast. So in the end, choice is not be eliminated.

[Shane @ Jul 23rd 2008 5:32PM]

Monopolies are about removing competition, not choice. They are similar, but not the same thing. You can make anything a monopoly or not a monopoly depending on how narrowly you define the market involved. This merger will obviously create a monopoly in the satellite radio market. The real question is whether XM and Sirius competing with each other keep consumer prices down and drive innovation, or does competition between satellite radio and other alternative forms of entertainment drive pricing and innovation.

[Artie Lange @ Jul 23rd 2008 5:39PM]

As Shane pointed out, monopolies are about COMPETITION, not choice. What's two competing companies minus one competing company? One monopoly. But at this point, if its the only way satrad can survive, then they should merge. I love the product, and I'd rather have one player in the sector than no sector at all.

[kjb434 @ Jul 23rd 2008 5:44PM]

Well, if FCC approves this, the issue of price goes out the door. The FCC is going to set caps on price if the merger is allowed.

This is one of the cornerstones to the prediction that satellite will ultimately fail. The primary revenue stream is regulated. Ads will definitely increase, but how many advertisers will flock to such a small audience?

[Andrew @ Jul 23rd 2008 6:28PM]

I have to agree that this doesn't really monopolize anything. Yes, they will be the only satellite radio provider, however, the choice is to listen to satellite, and pay for more channels, or to stick to your ipod or terrestrial radio for free. It's not like they can jack up prices and people are forced to continue to buy it because it's something they need in life. As kjb has said in previous posts, satellite sits on a fine line of where it's worth it's cost and if it will keep people paying when given free alternatives.

They can monopolize the satellite radio business all they want, but if they crank up the prices, they will only push satellite radio towards the extinction when people refuse to continue to pay for their more expensive, albeit better selection of music.

[TopaZ @ Jul 23rd 2008 7:17PM]

@Artie Lange:

True monopolies create a forced barrier to entry for new enterprises. For example, cable television is a regional monopoly. At my home, Time Warner OWNS the rights to the cable lines. Comcast cannot lay cable in my neighborhood, no matter how much they spend -- the city just won't allow it.

This is not the case with satellite radio. You, me, or anyone else with the funds can launch a satellite and join in the satellite radio business. Therefore, a combined company wouldn't be a monopoly, but simply a free market where only one enterprise is CHOOSING to participate.

[Artie Lange @ Jul 23rd 2008 5:05PM]

Stern does less than 5 hours a day (the commercial breaks - of which Stern personally gets a cut of the proceeds - are 10 minutes and getting longer), and WUS does not feature Stern or any of the other major talent. Further, Stern takes a week-long vacation nearly every month, and usually two-weeks off around national holidays. He admits that he's tired of radio and wants to retire as soon as his contract ends.

As for who else does 5 hours of entertainment a day, O&A do 3 hours of network radio, then 2 hours of XM radio - 5 days a week. Bubba the Love Sponge (who admittedly sucks) has a similar deal, although he ends up doing closer to 6 a day. George Norry (sic), the guy who took over for Art Bell, does 5 hours a night from midnight to 0500, as did Bell before him for nearly 20 years.

[silverboy31 @ Jul 23rd 2008 5:19PM]

I love my sirius and have had it since Stern came over, you can't beat uncensored radio. The reason this merger took so long is because the NAB is scared of satellite they've tried every stalling tactic possible, obviously they see it as a threat. regular radio especially here in Canada is horrible. Long live Sirius!!

[kjb434 @ Jul 23rd 2008 5:30PM]

Terrestrial radio never saw satellite as a serious competitor. If they did, they would do a lot more to stop it.

The reason they don't is because of profitability. All of the popular radio shows in the country are only accessible on terrestrial radio and make lots of money are are increasing listeners. Howard Stern's audience actually shrank when we went to satellite and hasn't grown much. With his current audience, he couldn't pull in the advertisers that would pay him to stay on. Sirius is in real pickle when they have to finance debt just pay Howard. Both firms can't afford to stay in business this way.

Whether you like it or not, satellite radio will not survive. Wall street is betting there failure because they don't see a future in it.

Currently the most profitable segment of terrestrial radio is Talk Radio which include political and sports talk. Advertisers pay big bucks to get on these shows. Standard music radio (which does suck) doesn't pull much money in. Why would i listen to a music station if i can pick my own playlist with songs i like and play it on CD's, HDD based, or MP3 players in cars?

[Andrew @ Jul 23rd 2008 6:29PM]

Shane: The only ads Sirius has are perhaps for other stations. Sometimes they break to a DJ, but they never have "commercials".

[Andrew @ Jul 23rd 2008 6:30PM]

Whoops, this was to the post below!