Sirius and XM Merger?
I heard about it last night and it angers me.
I’m not sure what all of the hype is about since none of this is official (i.e. has not been approved). It still has to be approved, making it a huge monopoly if approved and making things interesting. So that doesn’t mean this will actually go through. It still needs to be approved by the FCC which I highly doubt will allow it. Currently, those are the ONLY two satellite radio companies in the U.S. (well Worldspace is broadcast from D.C., or they have a headquarters there, but they do only broadcast worldwide and not in the U.S.). That would mean that the two would merge and have total control over the prices. If it goes any higher than $15 a month, assuming it goes through, I think a lot of people will drop their subscriptions. And it better not screw with the lifetime promotion for the Sirius radio that’s already paid off.
Also, there are no radios out there that can receive both signals due to the altitude and angle of the satellites and different technology. So everyone that has service X and wants service XY will need to buy new equipment and, if they wanted to, they could phase out all old equipment and say “Oh well. Sorry, we’re a new company and don’t support your device that came out last year.” Then that means this winds up to be a big purchase for consumers, not some measly $12.95 of whatever the new price might be (they said they might lower or they might raise the price at their discretion but that it’s not confirmed yet).
If there is one thing I am happy about is that Sirius knows how to do music and can teach XM a lesson or twenty. At the same time, Clear Channel still owns a huge stake in XM and I assume they’ll want to get a bit greedy and say, “Well, hey…you have all of these channels now so we can make a few more” and there’s not a thing either company can do about it. Clear Channel does have its own allocated bandwidth so they couldn’t go over that, so technically they could do this anytime if they chose to do, I guess. Plus that comes with the issue of what channels will remain and what channels will drop? Will the bandwidth be combined among the two companies or is another satellite radio company going to pop up now that there is the potential slot available (assuming bandwidth stays as is and when XM and Sirius merge (read: a big old if), they have just as much bandwidth as a single company did, or as they did before merging, in other words)?
I think the whole deal is ludicrous and I hope it’s never approved.
Posted: February 20th, 2007 under General News, Music, Sirius Satellite Radio, XM Radio.
Comments: 1
Comments
Comment from John
Time: February 21, 2007, 12:05 pm
Actually, Clear Channel’s stake in XM is now under 2 percent, so their stake in the company is minimal compared with 6-7 years ago. But they do own that chunk of XM’s satellite bandwidth — but only until late next year. CC also won the arbitration hearing last year that allowed them to put commercials on the four XM music channels they operate (Chs. 11, 20, 22 and 24), as well as forcing them to put Cincinnati’s news-tale WLW and Nashville country FMer WSIX on their service as part of a make-good for the alleged ad revenue CC had lost since 2004.
XM responded by creating four ‘mirror” music channels to duplicate the CC stations, minus commercials. But the bandwidth allocation means the four CC signals have much more space than the non-commercial XM music stations and sound better as a result. But after the deal expires, the CC bandwidth goes back to XM.
Those four stations, along with WLW and WSIX, will probably be yanked from the ‘bird when the CC-XM contract expires. How the merged company will reallocate the bandwith remains to be seen (and I’m also not a fan of the merger, since my guess is they will end up with a their payment system like cable TV — you get X number of channels for your basic rate, and if you want certain other channels, you’re going to have to fork over a few extra dollars a month for it).
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