So, it's
done:
Sirius has completed its acquisition of
XM, forming Sirius XM Radio with more than 18.5 million subscribers, making it the second-largest radio business in the US. The new company, headquartered in New York, expects to save about $400 million in 2009 while earning $300 million. If you're a drooling investor, don't go charging up to the champagne room just yet -- analysts are pointing out that neither company has ever posted a profit, and losses are in the billions. Anyway, can we move on to all the new, shiny Sirius XM receivers now, please?
Reader Comments (Page 1 of 2)
Pingmeister @ Jul 29th 2008 3:12PM
Fixed that quick. Nice! :)
Miguel @ Jul 29th 2008 3:15PM
Two questions of utmost importance:
1) Will my Sirius receiver be able to receive XM's exclusive MLB gameday audio broadcasts?
2) What's the new logo? (Okay, this one isn't as important, but Sirius' dog is awesome.)
sean @ Jul 29th 2008 3:40PM
To 1) the answers from both XM and Sirius as they initially filed to merge was that new hardware would be required to get both signals. I don't know if there is a hack around this, but the word from the company(-ies) is that you need to upgrade.
Mario @ Jul 29th 2008 4:00PM
1) No. Your Sirius receiver can only decode Sirius' signal. XM uses a different signal. It's like CDMA and GSM. Future receivers (promised to be on the market within the year) will be able to receive both. You will have to pay for adding the extra subscription.
Basically, there will more options going forward, but the two services won't act as a single merged unity until all existing receivers have been replaced with new chipsets capable of blending the two signals into one channel set, and/or Sirius' aging satellites fall from the sky.
LC @ Jul 29th 2008 4:58PM
When they consolidate redundant programming, such as both having Fox, CNN, NPR, as well as music channels such as their decade channels, I would imaging it would free up channels on both systems. Why couldn't Sirius, for example, feed the Stern show to an XM broadcast station, which would then send it to the XM Satellite for broadcast over their network to XM radios and vice versa for XM to do this with O&A to be received on Sirius radios from Sirius satellites?
They both originate from terra firma after all.
nicholas @ Jul 29th 2008 6:31PM
(1) YES. Others, please read the press release. Packages will convert some of the other system's programming into a format that your existing receiver can understand; however, this is a premium option.
Existing radios will be able to receive premium "SIRIUS Everything + XM Select" (for existing SIRIUS receivers) or "XM Everything + SIRIUS Select" (for existing XM receivers). You only need a next generation receiver if you want to choose an "a la carte" option where you pick and choose channels from both systems.
If you do nothing, you will keep your existing plan and service ("SIRIUS Everything" or "XM Everything").
Please see http://www.siriusmerger.com/uploads/ala-cart-Press-Rel-7-23-07.pdf.
Harkonian @ Jul 29th 2008 6:46PM
@nicholas Good info there, but it doesn't answer my scenario: I have a lifetime service with XM. What channels will I get? All XM + no Sirius? The PDF assumes users are currently paying a monthly subscription.
Nick8708 @ Jul 29th 2008 7:11PM
My guess is that they'll figure out a price for the lifetime subscribers to add the "& XM/Sirius select" option to their existing receivers and service. I don't know about XM, but Sirius's life time subscription was only for the lifetime of the unit (unless they changed that policy or I had a stupid Sirius rep) so upgrading wouldn't seem to be much of an option.
Andrew Borem @ Jul 29th 2008 3:15PM
I like that their market cap is about a quarter of what we would think it would be. Apparently 4 billion + 4 billion = 2.3 billion.
I do love satrad, though.
Alex Padilla @ Jul 29th 2008 3:17PM
I absolutely love Sirius. I haven't listened to XM as much as Sirius (as I don't have XM, but I do have my brother's car, which has XM), but I've listened enough to know I like it. Both of them together? Awesome.
And for once, I'm not too worried with there being only one type of company in any given industry or industry segment. The FCC did something right by ensuring that certain guidelines are followed for the next three years, such as pricing and channel selection. Honestly, I only see this benefiting the consumer, though I do have some slight fears about after that three-year mark.
BigDaddyM @ Jul 29th 2008 3:37PM
I am not concerned because they will only have a monopoly in SAT radio, not radio. So it is not like they control media. just one of many that hasn't even been able to really take off. There is competion.
I have Sirius but I have been hoping for this as long as I can get all the channels, then I am cool.
Alex Padilla @ Jul 29th 2008 3:59PM
Well that's the thing, this isn't terrestrial radio we're talking about here, it's satellite. And it's not like it's a monopoly, because there aren't any real anti-competitive practices going on. I'm just hoping that they don't get price-happy in three years.
Andrew @ Jul 29th 2008 6:27PM
And if they do, people will stop subscribing and stick with their iPods or terrestrial radios. Which is what allowed this merger to happen. People won't pay them if they jack the prices up because we already have plenty of choices in music delivery, in fact, they are already at the disadvantage since they are really the only one that charges.
Nick8708 @ Jul 29th 2008 7:15PM
I have to agree with Andrew. I work at Radioshack and we sell quite a bit of Sirius, but many people scoff at the idea of paying for "radio". I try to explain the quality of the programming and lack of commercials is worth the money...but still, nobody has a contract with the companies so they can leave any time they want if they're paying monthly, or they have already prepaid for one or three years or for lifetime service. I think consumers are safe with this merger.
Travis @ Jul 29th 2008 3:18PM
Sirius XM is serious.
zsdfjkn @ Jul 29th 2008 4:44PM
I see what you did there.
OR
wHy sO SERioUs?!?
Rick James @ Jul 29th 2008 5:00PM
Both responces FAIL
ZeitgeistXIII @ Jul 29th 2008 3:22PM
I hope it keeps them up I have loved my sat radio from the begining.:)
stankychicken @ Jul 29th 2008 3:23PM
Yay!
Rick White @ Jul 29th 2008 3:24PM
This is one Sirius merger.
Sora @ Jul 29th 2008 6:34PM
http://www.instantrimshot.com/
Nirmal @ Jul 29th 2008 3:25PM
Can we make it free now?
ryan @ Jul 29th 2008 3:26PM
As long as the keep ethel and XMU im happy with this
Blair @ Jul 29th 2008 4:16PM
and Squizz...
bartoron @ Jul 29th 2008 4:30PM
Ethel is awesome. Lucy is pretty good, too.
kastonie @ Jul 29th 2008 6:17PM
keep the station formats the same, but give them the sirius names...because wtf is ethel? and squizz....first time i got ahold of an xm radio i was like wtf channel is this based on the names...the sirius station names make more sense....
Andrew @ Jul 29th 2008 6:30PM
kastonie: I'm not sure what you mean, Sirius names channels the same way. Octane, Lithium, etc.
James Jones @ Jul 29th 2008 3:27PM
Sirius screwed themselves when they signed Howard to that $500 million contract
TopaZ @ Jul 29th 2008 3:38PM
Really? Because 1.2 million listeners of his show (a very low estimate) times $13/month times 5 years = over 1 BILLION dollars.
Pingmeister @ Jul 29th 2008 3:43PM
Check out their subscriber numbers before he joined and one year after. If I am not mistaken they made their money back in less than a year.
I am glad the merger is done so I can sign up. Once they get the new rates and technology all worked out I'm in.
sean @ Jul 29th 2008 3:46PM
@ToPaZ:
The next highest-rated satellite channel of any channel is XM's 20 on 20. They have 1.1 million listeners to Hoo Hoo's 1.2 million.
Let's see, which channel is more profitable.......
SteveH @ Jul 29th 2008 3:49PM
13*12*5*1,200,000 = 936 million.
just sayin.
kjb434 @ Jul 29th 2008 4:12PM
You can run that math, but they truly haven't made there money back. How much subscriber money is spent on maintaining and upgrading the radio towers?
Yes, radio towers, you didn't think you always got a signal from a satellite did you?
They have to spend millions a year to keep these towers going along with leases on the land these towers sit on. Not to mention filing papers with the FCC and paying them to allow the repeater towers to exist.
Also, the merger will have bandwidth issues they have to work out.
You will have to get a new receiver because each service will start dropping channels left and right. They may keep certain XM music channels and certain Sirius ones and no duplicates. I'm wondering if the new company will subsidized or pay for the receiver exchange? To me, a lot of pissed off customers finding out that their receiver may only get half the channels when they start consolidating channels. If they do subsidize, then that will be a massive cost.
In the end, this is an easy merger. Just look at Sprint/Nextel when they merged there two networks. That was a whole lot of fun!
TopaZ @ Jul 29th 2008 6:18PM
@Sean:
We were discussing the initial claim that "Sirius screwed themselves" by giving Howard the contract, which simply is not the case.
It's quite obvious that playing the same 20 songs all day is profitable -- it's how terrestrial radio has survived for decades. But on a paid service, you have to provide more than just that. They can't all be Top 40 stations! "Top 21 on 21", etc.
Jay Evans @ Jul 29th 2008 3:28PM
As a result of the merger, SIRIUS XM Radio will also be able to offer consumers new packages in audio entertainment, including the first-ever a la carte programming option in subscription media. In addition to two a la carte options, the new packages will include: "Best of Both," giving subscribers the option to access certain programming from the other network; discounted Family Friendly packages; and tailored packages including "Mostly Music" and "News, Talk and Sports." The first of the new packages will be available in the early Fall.
"One of the most exciting benefits of this transaction is the ability to offer subscribers the option of expanding their subscriptions to include the Best of Both services. Given the respective popularity of exclusive programming on both SIRIUS and XM, we expect many subscribers will upgrade their current subscription," said Karmazin.
Taylor @ Jul 29th 2008 3:37PM
I just hope i can get sirius stations in the new Saturn Sky i bought yesterday. It only has XM and i knew this merger was coming up but i wasn't going to wait to buy a car JUST for that, so i got it anyway... I miss Sirius already and it's only been one freakin day! I've had trials of XM before and i just don't like it...
-Taylor
offroadering @ Jul 29th 2008 4:04PM
you bought a saturn and you are woried about the radio?
phanbouy @ Jul 29th 2008 6:14PM
nothing says punk rock like a saturn
TopaZ @ Jul 29th 2008 7:14PM
Have you SEEN a Saturn Sky? It's sick! First time I saw one in real life (before I knew what it was) I thought it was a $60,000 roadster.
Jay @ Jul 30th 2008 7:12AM
Seriously, Saturn Sky is one hot car. I had a Saturn Ion when they first came out and it sucked bad. But Saturn has come a long way with their new lineup with the clean look and nice designs. (maybe not the Astra...) And personally, I was sad when Transformers had Pontiac's version than Saturns... And their build quality went up too.
But at any rate, I do enjoy some stations in XM - Ethel is def. one. I'm more pop/dance/trance guy so I listen to Beat 36 on Sirius a lot and it def fairs better than XM's BPM(?). It'll be cool to have some of both. I can't wait :)
pk1451 @ Jul 29th 2008 3:40PM
Sirius radio had 600,000 subscribers before Howard Stern. After he joined Sirius had over 4 million plus customers. How is it possible for Sirius to make no profit. Let's say 4 million customers at $8/month = $32 mill x 12 months = close to $400 mill/year. There major cost is payroll. Satellites already in space. It appears there making more than there spending so how can they be in the "red" still?
Pingmeister @ Jul 29th 2008 3:44PM
I think you would be amazed at what they have to pay for licensed material like the NFL and NASCAR.
JoeBoo @ Jul 29th 2008 3:53PM
Satellites already in space?, yes, Satellites paid for?, no, and very far from yes. Those things don't come from WalMart.
lukas88 @ Jul 29th 2008 3:48PM
Score one for monopolies
sonicwind @ Jul 29th 2008 3:49PM
The XM symbol behind the dog makes it look like the dog just made a huge fart cloud.
Nicky-Larson @ Jul 29th 2008 4:02PM
And let the Price Start Skyrocketing :)
blue43fan @ Jul 29th 2008 4:29PM
Can you explain to me exactly why you think the price will skyrocket? It's not as if there's a monopoly in place, satellite radio has more competitors than you could possibly imagine (iPods, terrestrial radio, ect) and you have to PAY for it unlike terrestrial (free) (crappy) radio which is in EVERY FREAKING CAR ON THE ROAD.
Some people, such as myself, are willing to pay for diverse, commercial free, uncensored content, but if they raise the prices not only will they have a hard time retaining the customers they already have, but it will be even tougher to convince new customers to sign up.
So, exactly why do you think the prices will skyrocket, again? :)
CaptCaveman @ Jul 29th 2008 7:12PM
Part of the agreement with the FCC and the DOJ for them to approve the merger was that they could *not* raise prices.
I wish the same agreements were made when oil companies merged...
Jay @ Jul 30th 2008 7:16AM
Simple.
Stop the subscription and go back to terra radio. Or iPod. Oh the works of free will....
Jason @ Jul 29th 2008 4:03PM
Mel Karmazin will be on the Howard Stern Show tomorrow morning to take questions and shed some more light on the changes.
From the press release it says you will not have to buy a new radio but it looks like you will have to upgrade your subscription to get the combined service.