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XM And SIRIUS Radio Merging

ScuttleMonkey posted more than 7 years ago | from the monopoly-is-such-a-fun-game dept.

Businesses 301

lenny6998 writes to tell us Yahoo! News is reporting that XM and Sirius Radio, the only two major players in the relatively new market of subscription satellite radio have announced a merger. "The two companies said in a statement that Mel Karmazin, the CEO of Sirius, would become chief executive of the new company while Gary Parsons, the chairman of XM, would remain in that role."

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Guess it was just a matter of time... (0)

dacarr (562277) | more than 7 years ago | (#18072280)

...before they decided to stop competing. I mean, are they really competition for each other?

Re:Guess it was just a matter of time... (4, Insightful)

HTTP Error 403 403.9 (628865) | more than 7 years ago | (#18072322)

Wonder when they will announce price increases?

Re:Guess it was just a matter of time... (2, Insightful)

holden caufield (111364) | more than 7 years ago | (#18072532)

Or the addition of commercials? I've never subscribed to either, but I thought one of the services still ran commercials (maybe it's Sirius because I think Stern reads them on-air) even though you were paying money for them.

It will be interesting to see if the non-commercial-running service stays that way.

Re:Guess it was just a matter of time... (1)

SatanicPuppy (611928) | more than 7 years ago | (#18072812)

XM definitely does commercials on some stations. Usually pretty lame ones...Highly amusing what they seem to think their demographic is.

Re:Guess it was just a matter of time... (3, Funny)

Spritzer (950539) | more than 7 years ago | (#18072954)

I love listening to Bill O'Reilly and hearing Viagra commercials every other break.

Re:Guess it was just a matter of time... (1)

edwdig (47888) | more than 7 years ago | (#18073300)

The talk stations on both brands have commercials. XM has four or five music stations which are run by ClearChannel and have commercials. Those stations pretty much just waste bandwidth, as XM has there own commercial free equivalents to the ClearChannel stations.

Re:Guess it was just a matter of time... (2, Insightful)

Egonis (155154) | more than 7 years ago | (#18072822)

Remember "PayTV"?

Back in the day here in Canada, the first cable companies called their service "PayTV", no commercials.

It was advertised that commercials were necessary for each network to pay for their broadcasting charges in maintaining towers and whatnot.

But soon enough, they saw money.

And the same will happen to Satellite Radio.

Re:Guess it was just a matter of time... (4, Informative)

Spritzer (950539) | more than 7 years ago | (#18072928)

Both services have commercial-free stations. With XM (my preferred service) the stations actually run by XM are commercial-free. There are plenty of other stations run by outside sources (News, Talk, some music) which have advertising in order to sync properly with their original broadcast source.

Re:Guess it was just a matter of time... (0)

Anonymous Coward | more than 7 years ago | (#18073104)

There are plenty of other stations run by outside sources (News, Talk, some music) which have advertising in order to sync properly with their original broadcast source.
Obviously, all of the profits associated with those "synchronization" commercials are given to respected charities. Right?

Re:Guess it was just a matter of time... (3, Interesting)

DevoPhl (702812) | more than 7 years ago | (#18073008)

Sirius went to commercial free music channels rather early on. XM still have a majority of its music channels with limited commericals but dropped them about 2 years ago.

Its clear that XM and Sirius were in competition for a limited market. The iPod in the end was what brought these two together. XM and Sirius had a small window before cars started installing adapters for iPods. Since almost everyone who listens to music has a iPod, it meant that the benefits of satellite radio where lost when you could just plug in your iPod.

Whereas the two radio networks were counting on subscriptions continuing to increase each year for the next 4 years, in reality, they started leveling off this year. And now they have a business model based on a subscription base neither is likely to meet.

As a result, I think we'll see one of two things out of the new company. Either a substantial rate increase or a substantial content decrease. At any rate, its unlikely that the new company will have the variety of content that we see on both today.

Re:Guess it was just a matter of time... (2, Informative)

JimDaGeek (983925) | more than 7 years ago | (#18072616)

That will happen as soon at the government OKs the deal. The OK happens when some politicians are given brib^H^H^H^H campaign contributions. Capitalism at its finest!!!

Re:Guess it was just a matter of time... (1)

meme lies (1050572) | more than 7 years ago | (#18073402)

Wonder when they will announce price increases?

Considering their combined install base is still a fraction of what it could be, I doubt the price of a subscription will go up any time soon. They're still trying to attract customers after all. They're also trying to hold on to the customers they do have, many of whom are somewhat lukewarm-- I couldn't quote the numbers but I know that a large perentage of new subscribers are new car buyers (meaning satellite comes with the car, and the buyer says "what the hell, I'll subscribe." ) That's not exactly a fanatical base who will stick by any price increase.

Additionally, their competition was never just "each other." They may now be the only satellite radio game in town, but they still have to compete with free AM and FM as well as those who would just listen to their iPod.

Re:Guess it was just a matter of time... (1)

silentounce (1004459) | more than 7 years ago | (#18072356)

I would say that yes, they were. Some of them had exclusive contracts with say the NFL, or MLB. And who is going to shell out the money for both? A lot of their stations services overlap just like say cable TV and satellite TV.

Re:Guess it was just a matter of time... (1)

tchuladdiass (174342) | more than 7 years ago | (#18073288)

But that also works in the opposite direction. Since they both wanted exclusive contracts, then the NFL was able to charge a premium. Now that they can't get the two companies into a bidding war, the price should go down.

AntiTrust (0)

Anonymous Coward | more than 7 years ago | (#18072744)

We have all these laws to punish monopolies, and yet we allow monopolies to form without a blink of the eye. It is absolutely retarded. And all Roosevelt's fault for his "good trust", "bad trust" bastardization of the antitrust laws. We give the regulating bodies so much leeway in deciding when mergers are allowed and when they are not that, that it completely defeats the purpose of preserving a competitive market. Instead, they just abuse the law by offering weak resistance to mergers in order to coerce to companies into doing things and then let the merger go ahead once they are secured.

You want real anti-trust laws? Stop punishing companies for attaining a position that our laws encourage, and have fair formulaic restrictions on mergers to begin with - like any merger which would make you largest competitor in any given field is barred. Then small companies would be able to merge to the point where they could compete with the big boys (increasing competition), but big companies couldn't stifle up-and-coming competition.

Companies actually earning their customers rather than buying out the competition - that is what I call a competitive market. Which is why it will never happen - our politicians would much rather have their their government supported monopolies and oligopolies and call it free market, then implement real pro-market laws.

Re:AntiTrust (1)

Volante3192 (953645) | more than 7 years ago | (#18072856)

There's no problem with some monopolies. Major league sports for one example. MLB is a monopoly. So what?

Apparently the same can be said with satellite radio: both companies are reporting losses. The market has spoken and the market has said "well, some of us want satellite radio, but not enough to warrant two seperate companies."

Re:AntiTrust (0)

InsaneProcessor (869563) | more than 7 years ago | (#18072952)

This is antitrust. There is no question of that issue. One is the only competition with the other and the customer is the public. If this goes through, there will be price increases and I still won't subscribe to the stupid idea of satelite radio. There appears to be enough stupid people that do subscribe that they will pay any price.

Oligopoly (0)

zymano (581466) | more than 7 years ago | (#18072314)

Now monopoly.

Re:Oligopoly (3, Informative)

SuperMario666 (588666) | more than 7 years ago | (#18072372)

Not really, as they will still face competition from traditional radio.

Re:Oligopoly (1, Funny)

jandrese (485) | more than 7 years ago | (#18072436)

I'm sorry, I just spit my coffee out across my screen.

Re:Oligopoly (2, Informative)

silentounce (1004459) | more than 7 years ago | (#18072400)

Not all monopolies [wikipedia.org] are bad. Some result in the best product, even considering price, for the consumer.

Re:Oligopoly (4, Insightful)

cdrudge (68377) | more than 7 years ago | (#18072504)

Exactly. Monopolies in and of themselves are not illegal. Antitrust laws make it unlawful to maintain or attempt to create a monopoly through tactics that either unreasonably exclude firms from the market, or significantly impair their ability to compete.

Radio is a coercive monopoly (4, Informative)

tepples (727027) | more than 7 years ago | (#18072618)

Not all monopolies are bad. Some result in the best product, even considering price, for the consumer.

You linked the word "monopolies" to the Wikipedia article "Natural monopoly". I dispute that broadcasting has to be a natural monopoly. In fact, the structure of broadcast licensing in the United States ensures that music radio broadcasting is a coercive monopoly. This is due to the FCC's foot-dragging on low-power FM station licensing, bought and paid for in part by XM investor Clear Channel Communications and by National Public Radio.

Re:Radio is a coercive monopoly (2, Interesting)

lc0h0lPr3p (1066128) | more than 7 years ago | (#18073346)

My town has a low power FM station and I wish it didn't. They play terrible soft jazz, don't provide any way to contact them and don't take requests. Low power FM is going to clutter up a limited spectrum with 1 man ego projects. At least with a commercial station I can request a change of songs or buy it. Low power FM is actually less responsive than the all evil Clearchannel!

Re:Oligopoly (4, Funny)

morgan_greywolf (835522) | more than 7 years ago | (#18072802)

Not all monopolies [wikipedia.org] are bad. Some result in the best product, even considering price, for the consumer.
Bill Gates? Is that you?

Finally (0)

Anonymous Coward | more than 7 years ago | (#18072360)

Art Bell and Howard Stern together.

Re:Finally (5, Funny)

kennygraham (894697) | more than 7 years ago | (#18072910)

Art Bell and Howard Stern together.

Art will introduce us to the shadow people, then Stern will ask them to show us their boobs.

Well (0, Redundant)

Sneakernets (1026296) | more than 7 years ago | (#18072362)

There goes the competition!

Satellite Radio is sooooo 2002. (1, Interesting)

dada21 (163177) | more than 7 years ago | (#18072386)

I had XM for a few months -- loved it for about 15 days. Then I was too lazy to extricate myself from the deal, so I turned it over to a friend who travels over the road a lot.

Since I had that subscription, I realized that satellite radio -- like all "one size fits all" radio, is dead. Honestly. It may not actually have died yet, but the days are numbered.

I have a great MP3 collection at home -- running on a (yes, lame) Windows Media Center PC with a ton of storage. I also have a bunch of my favorite movies encoded both for highdef and lowdef. Why? Because I can now access everything I "own" remotely.

My phone is an HTC Trinity P3600 -- currently unavailable in the States as far as I know. With the Dopod 810 ROM, I am able to utilize T-Mobile's EDGE network to my advantage. If I want to listen to my MP3s, I do so remotely using that EDGE network. Often times I am able to get a sustained 200kbps download rate, which drops to about 80kbps in more remote areas. For most of my travel (nationwide), I am able to listen to my entire playlist without having to carry with me anything more than my PDA phone. It works great -- and I can plug my phone into my car stereo and listen to my tracks at will. I even created a nice interface for picking songs, and it works great. I pay one flat rate for my EDGE connection, and for an additional $20 a month I also get unlimited use of Starbuck's WiFi network, which works great when I am really in the boonies.

Will most people do this right now? No, because the costs are a bit too high, and most people aren't technically adept enough to set it up. Yet those days are coming to a close as more people are buying cell phones that aren't locked by the vendor (T-Mobile loves to lock great features out of their cell phones, so I buy mine on the grey market). I've seen alpha versions of bittorrent-protocol software that runs on Windows Mobile, and I'm sure more is on its way for other phone/portable OSes. As this happens, we will soon see peer-to-peer "radio" stations taking over and giving the consumer what they REALLY want.

I'm sure that XM and SIRIUS will be watched closely by the "evil" FCC, but no matter what happens, their days/years ARE numbered. Regular radio is having a huge problem attracting advertisers, because the new generation now has iPods. The iPod is a great device, but it is limited to only what you brought from home.

If Microsoft wants to kill Apple, all they need to do is come up with an iPod-like player that has EDGE/GPRS connectivity, and offer people music-by-the-song or MP3-over-the-air accessibility. Imagine what will happen to the "broadcast" market when the unicast market can destroy it at any time?

Re:Satellite Radio is sooooo 2002. (5, Interesting)

WarlockD (623872) | more than 7 years ago | (#18072470)

Sorry, I use it ALL THE FREAKING TIME. Ask any trucker if they will part with their Satellite radio.

I drive close to 300 miles a week in the DFW area and local radio stations just don't have enough content to keep me intrested. Except for a few talk shows that I listen to, I need a sat radio to keep sane.

Yes, I do have an ipod loaded to the gills with music, but to be frank, without Satellite, I wouldn't have any NEW content to keep me awake.

Re:Satellite Radio is sooooo 2002. (1)

holden caufield (111364) | more than 7 years ago | (#18072576)

One word: Podcasts.

That is all.

Re:Satellite Radio is sooooo 2002. (1)

tepples (727027) | more than 7 years ago | (#18072830)

Except for a few talk shows that I listen to, I need a sat radio to keep sane.
One word: Podcasts.
Aren't those roughly the same thing as "talk shows"?

Re:Satellite Radio is sooooo 2002. (1)

SatanicPuppy (611928) | more than 7 years ago | (#18072852)

Meh. I want new music, and I don't want to have to lurk on the music nerd forums to find it. Admittedly I'm not terribly satisfied, but I'm not unsatisfied enough to kick the service...the ideal for any company. =P

Re:Satellite Radio is sooooo 2002. (2, Funny)

darkwing_bmf (178021) | more than 7 years ago | (#18072566)

"...for an additional $20 a month I also get unlimited use of Starbuck's WiFi network, which works great when I am really in the boonies."

Quote of the day.

Re:Satellite Radio is sooooo 2002. (0)

Anonymous Coward | more than 7 years ago | (#18072594)

When you can listen to live events like sports or pick up live news, maybe you'll be right. Until then, I'm keeping my XM. Go Hokies!

Re:Satellite Radio is sooooo 2002. (0)

Anonymous Coward | more than 7 years ago | (#18072634)

if there is a starbucks in your boonies, you clearly are not in THE boonies.

you will do better with evdo if you're away from civilization. the signals are better and the throughput is higher. I regularly get around 1Mbps in East Bumblefuck, Kansas.

commence evdo vs edge flamewar.

in all seriousness though, I thought that as a licensing requirement, the fcc mandated that xm and sirius could NOT merge...

Re:Satellite Radio is sooooo 2002. (2, Insightful)

failedlogic (627314) | more than 7 years ago | (#18072650)

While it seems like a nice solution, your limitation is of the music (content) you "own" and the space avilable on your server. Sirius and XM both offer different types of music, talk radio, sports radio, live music play, etc. I don't subscribe to either service -yet- but this definately appeals to me. I have a CD collection spanning 250+ CDs I've purchased. Its nice to listen to different music. And its cheaper than buying new CDs. Don'tcha think?

If Internet radio costs per kilobyte (1)

tepples (727027) | more than 7 years ago | (#18072680)

If Microsoft wants to kill Apple, all they need to do is come up with an iPod-like player that has EDGE/GPRS connectivity, and offer people music-by-the-song or MP3-over-the-air accessibility. Imagine what will happen to the "broadcast" market when the unicast market can destroy it at any time?
What will happen is that these mobile phone network operators will bill for music streams by the minute or kilobyte, and Clear Channel and other XM/Sirius investors will invest in the network operators who seek to skim coercive-oligopoly dollars off their user base. Look what happened with ring tone prices vs. prices for the same song on iTunes Store and the various PlaysForSure stores.

Re:Satellite Radio is sooooo 2002. (4, Insightful)

GrayCalx (597428) | more than 7 years ago | (#18072708)

Yeah I have to agree with your other replier. Thats great that you don't find a need for satellite radio (I mean it saves you money right?) but others of us have a good need for it. First off the truckers and professional drivers who are looking for consistent radio coverage no matter where they are driving. But ontop of that those of us looking for specific niche channels. Howard Stern fans, Opie and Anthony fans... general sports fans (for instance you can probably get all of your local sports team's games on your local radio, but what if you like a out-of-state team, or you like listening to any game possible). There are comedy channels (24/7 stand-up routines), news channels (CNN, CNN Headline, FoxNews, BBC WorldNews). Satellite really does offer up a lot of options for those not only interested in music.

In terms of music-only listening I think you make a great point, but satellite offers much more than just music.

what you brought from home = infinity (1)

maillemaker (924053) | more than 7 years ago | (#18072806)

>The iPod is a great device, but it is limited to only what you brought from home.

What happens when you have every song ever released digitally on your iPod?

Re:Satellite Radio is sooooo 2002. (1)

clf8 (93379) | more than 7 years ago | (#18072808)

Sure, if the only music you ever want to listen to is music you own, there's absolutely no need. However, of late I've found my collection growing stagnant, and the only real stuff being added is new albums from the same bands. Not to say that current music is always the best, but satellite radio is also a great way to find new things to listen to. Sure, there's plenty of other ways (filesharing, live shows, podcasts, or even myspace), but Sirius/XM isn't a bad way to go either. Plus Sirius you can stream online also. If I only knew how the hardware was going to shake out, I might consider getting one.

Re:Satellite Radio is sooooo 2002. (1)

markbt73 (1032962) | more than 7 years ago | (#18073044)

Wait, so when I got an XM radio in 2002 I was actually trendy for a few seconds? Cool!

Re:Satellite Radio is sooooo 2002. (1)

darjen (879890) | more than 7 years ago | (#18073416)

I feel about the same way about Sirius. I was a subscriber for a couple of years, until recently when I sold my car and purchased a newer one. Even with so many choices, I found the music to be rather hit and miss. I like stuff from many different genres, but I am picky within those genres. So I found myslef only really enjoying a portion of the content from each station. Even the opera and classical stations weren't that consistent for me, since I like some opera but not definitely not all. I do carry around an Ipod, but I can fit all of my music on it. So I don't have the problem you mention of leaving anything home. I listen to it at work and on the road. I create playlists from my own music of stuff I know I will like. And I have so much music that it will take me a long time to listen to it all. I usually glance at new releases for anything interesting coming out, so I don't need satellite radio to discover new stuff either. All in all, it's just not worth it.

Actually, it's kind of the same way how I feel about cable TV as well. Since I have been subscribing to netflix, I am really tempted to just cancel the cable and get my entertainment from DVDs. I usually don't watch TV enough to even surpass 2 or 3 DVDs a week. And for any interesting shows, I can be patient and wait for them to come out on DVD too. The only real reason I've been hanging onto it is for HD sports events. You can't really beat the superbowl and Cavs games in HD. But even that has limited entertainment value for me as well, so I guess the jury really is out.

Re:Satellite Radio is sooooo 2002. (3, Insightful)

tchdab1 (164848) | more than 7 years ago | (#18073426)

There will continue to be a market for Sat radio as there continues to be a market for local broadcast radio. Your Tb of home-stored mp3's and movies won't tell you why people are meeting in town to discuss tonight's city council meeting, who died today, the status of rain, or what those fire engines were at 2 in the morning. They won't show you things you don't already know. Sure, you can get those things from the 'net in other ways, but many people like it this way, and the media is flexible to find new folks who like it in a slightly different way that it can accomodate.

Things don't die out as much as they thin out because of increased choices.

Egos (4, Insightful)

teiresias (101481) | more than 7 years ago | (#18072390)

A more interesting merger than XM and SIRIUS, is really now Howard Stern and Opie & Anthony being on the same network.

Can one satellite network handle two (well three) giant egos.

Let's find out.

Re:Egos (3, Interesting)

airos4 (82561) | more than 7 years ago | (#18072466)

Well, it didn't work so well when one terrestrial company tried to contain the three of them. WNEW had them all at once, and O&A were treated as the little stepbrothers who were slapped with gag orders and so on regarding talking about Howard. I foresee tension in the Force.

On another note, how will this work hardware-wise? Can they in fact offer one united channel selection over any current hardware? Will they continue to offer two separate "branded" offerings that each go to the proprietary radios until new hardware can be rolled out?

Re:Egos (1)

acroyear (5882) | more than 7 years ago | (#18073036)

and more importantly, what will become of "duplicate" channel offerings. Both have a standard symphonic classical station, a vocals/opera station, and a "pops" station, and that's just within the classical genre, the smallest. Which of those 6 identities will survive?

For the larger genres like "rock" or "urban", what will survive?

Wall Street may like the certitude this brings financially, but the customer base on BOTH networks will have to deal with a LOT of uncertainty as to which of their favorite shows and djs may disappear in the coming months...

Didn't the FCC already say no? (4, Informative)

MSRedfox (1043112) | more than 7 years ago | (#18072396)

We already covered the FCC saying no. http://science.slashdot.org/article.pl?sid=07/01/2 2/2237249 [slashdot.org]

What does "no" really mean? (5, Insightful)

Infonaut (96956) | more than 7 years ago | (#18072556)

We already covered the FCC saying no. http://science.slashdot.org/article.pl?sid=07/01/2 [slashdot.org] 2/2237249

I was wondering about that too. They either are so desperate for a merger that they'll take their chances with the FCC, or they've already talked with Martin and convinced him that it won't be anticompetitive.

Who knows, they may succeed in framing the competition issue as one applying to the streamed audio market, which encompasses radio, Internet radio, and sat radio. When discussing broadband, the FCC frequently defines the market rather broadly, incorporating dish access into the discussion, as if it is a serious market participant. Given their generally broad interpretation of communications markets, they (or at least Martin, Tate, and McDowell) may buy the argument.

Re:Didn't the FCC already say no? (4, Insightful)

dr_dank (472072) | more than 7 years ago | (#18072572)

I guess the check finally cleared.

Look up... waaaaay up (5, Funny)

MarkRose (820682) | more than 7 years ago | (#18072398)

Methinks it's time to buy a telescope to watch them merge the satellite!

Re:Look up... waaaaay up (0)

Anonymous Coward | more than 7 years ago | (#18073448)

Ground Control: "Satellites successfully merged!"
NASA: "That was the International Space Station dufus!"

Huh? (3, Insightful)

rudy_wayne (414635) | more than 7 years ago | (#18072422)

XM and Sirius have never been profitable. They have both lost hundreds of millions of dollars since their inception. So what good is a merger?

Re:Huh? (0)

Anonymous Coward | more than 7 years ago | (#18072526)

It means that I can finally get Sirius content on my GM factory radio without some sort of ugly hack. Of course, I long since dropped XM service since the music appeared to be in some sort of neverending loop. I get irritated when the same song repeats ad infinum..and XM let some big media conglomerate manage a lot of their channels instead of hiring proper DJ's like Sirius.

Re:Huh? (1)

Radon360 (951529) | more than 7 years ago | (#18072558)

Now they can lose money together...

Re:Huh? (1)

Tablizer (95088) | more than 7 years ago | (#18073318)

Now they can lose money together...

It's called "marriage" in the domestic sector.
     

Re:Huh? (4, Interesting)

cdrudge (68377) | more than 7 years ago | (#18072622)

If you look at the combined content of the separate companies, there is a lot of duplication of effort. Each provider has some exclusive content, but the majority of content is duplicated. There is also 2x the infrastructure, 2x the personnel, 2x the billing systems, etc. Well, it may not be exactly 2x but you get the idea. By combining the two, you combine the customer base yet cut the overall operational budget. Thus the bottom line is improved. There could also conceivably be some added advantages of freeing up bandwidth. Or they could sell of the radio spectrum too.

Nothing will be decided probably until at least years end. Even if they get approval, it will take some time to also figure out the technical details as to who's equipment to go with, who gets laid off, etc. Actual savings probably won't be seen for several years, but if indeed they do merge, the cost of competition gets a lot cheaper in a hurry.

Re:Huh? (5, Informative)

Miamicanes (730264) | more than 7 years ago | (#18073038)

The majority of content is NOT duplicated. Sirius and XM sound NOTHING alike. Sirius channels sound like normal radio stations, but without commercials. XM channels sound like somebody took a random pile of CDs, shoved them in a changer, and hit the "shuffle" button.

They're about as equivalent as Tylenol, Ibuprofen, and Naproxen sodium. Yeah, they're technically all painkillers and reduce fever, but anyone who's ever had a headache or fever knows that they're definitely NOT all the same. Tylenol utterly sucks compared to the other two, but some people are forced to use it because they can't tolerate them. Ibuprofen rocks for headaches, but sucks for fevers (unless you enjoy having your fever come back every 4-6 hours). Naproxen sodium is a godsend for fevers (breaks once, stays that way), but a complete waste of time for headaches. The same is true of Sirius and XM. Both have slightly different audiences with different expectations -- all of whom are going to be FURIOUS if their network mutates into the other. Even slightly.

Talk to anyone who subscribes to either service. I guarantee that 99% of them will react to the news of a merger with absolute horror at the thought that ${their_network} will get turned into ${other_network}. I *guarantee* that if a merger happens and the music channels from one or the other get dropped to "streamline" and "eliminate redundancy", AT LEAST half of the losing service's carriers will leave in disgust. At the same time, the "winner" network will probably lose at least a quarter of its customers if it changes even slightly to be more like the loser's format was. Ultimately, we'll be stuck with one mediocre provider whose financial position is only slightly better than before, and now has hundreds of thousands of angry and pissed off former customers saying bad things about it and discouraging their friends from subscribing.

This is horrible news for the customers of BOTH services. I expect to see an outpouring of anger from customers of BOTH Sirius AND XM demanding that the FCC NOT allow a merged company to own both frequency bands in a desperate effort to derail the whole merger.

Re:Huh? (1)

RevMike (632002) | more than 7 years ago | (#18073376)

If you look at the combined content of the separate companies, there is a lot of duplication of effort. Each provider has some exclusive content, but the majority of content is duplicated. There is also 2x the infrastructure, 2x the personnel, 2x the billing systems, etc. Well, it may not be exactly 2x but you get the idea. By combining the two, you combine the customer base yet cut the overall operational budget. Thus the bottom line is improved. There could also conceivably be some added advantages of freeing up bandwidth. Or they could sell of the radio spectrum too.

The big deal is the satellite infrastructure. It is really really really expensive to maintain satellites.

Back when satellite radio first started to get some traction, I remember hearing that 11 million subscribers was the magic number where they could maintain the satellite cloud and break even. Over the long term they'll be migrating to a single platform with only a single set of satellites. Together they currently claim about 13 or 14 million subscribers, so it is reasonable to think that the combined entity has very good prospects of being sustainable.

Re:Huh? (1)

Dutch Gun (899105) | more than 7 years ago | (#18072704)

Now they don't have to waste dollars competing against each other. Instead, they can focus on competing against traditional radio and podcasts+mp3 players. And, this allows them to pool technology and resources. Economics of scale, and all that.

Re:Huh? (1)

supabeast! (84658) | more than 7 years ago | (#18072922)

XM and Sirius have never been profitable. ... So what good is a merger?
Merging will allows the companies to combine a lot of operating costs by eliminating redundant employees. It will also allow the new company to provide a better service to customers, as the two systems can be combined to provide new channels, at least to anyone interested in buying new hardware.

Most importantly, merging allows the companies to stop worrying so much about beating each other and start focusing on the new juggernaut in the audio industry--digital music players. Portable digital music players weren't even an idea when XM and Sirius were founded, now they're becoming ubiquitous. Podcasting has created a huge amount of talk-radio like content that's largely free. iTunes combined with iPods has created thousands of new competitors for satellite radio. Beating digital music players is going to be a tough battle, and it doesn't seem likely that the companies could do so if they're also trying to compete with each other.

Re:Huh? (1)

Jeff DeMaagd (2015) | more than 7 years ago | (#18073006)

If they can merge the user bases without too many subscribers defecting, cut the costs of operating competing satellites, cut out the duplication of royalties, and other duplicated overhead, I think they can make money. They bid heavily against each other to get "talents" like Howard Stern and others. They spent far too much money competing against each other when their main competition is really terrestrial radio, podcasts, audio books, mp3 players and such. That's the idea.

Whether or not they can do this without letting it get to their heads is a different matter. Users of one of the two services have been complaining about getting ads when they were sold a service that wasn't supposed to have ads.

FCC? (0)

Anonymous Coward | more than 7 years ago | (#18072474)

Every time this was rumored there were numerous posts stating this was not possible due to FCC restrictions on their licenses.

If true, it should be interesting to see how they work it out.

What changes? (1)

twostar (675002) | more than 7 years ago | (#18072476)

Are they going to consolidate the music stations? Offer identical options on both sets of hardware or keep things seperate but merge the overhead?

One of the reasons I picked Sirius was the music selection on the channels appealed to me more then on XM. Am I going to loose out now?

This has been talked about before but I've never heard what will actually change for the end user.

Re:What changes? (2, Interesting)

GrayCalx (597428) | more than 7 years ago | (#18072754)

I agree with you. I'm a XM subscriber (because I like Opie and Anthony) but having come FROM a Sirius subscription, I enjoy Sirius' music channels TONS more than what XM offers. Hopefully this is a chance for me to get the music of Sirius with the Talk programming of XM, but we'll see.

I read an article that stated they may be able to offer al la' carte programming where you pick and choose which channels you get. I hope that comes through as well. I'd pick 10 and hopefully pay less... but you know thats not going to happen.

Re:What changes? (1)

Symbha (679466) | more than 7 years ago | (#18073294)

I left XM for Sirius because as you point out, their music selection is better.
Their NPR selection is also lightyears ahead of XM. I'm hopeful that Sirius' CEO being at the helm is a good sign.

Although monopolies are bad... (1, Interesting)

Anonymous Coward | more than 7 years ago | (#18072478)

It might be nice to have some sort of Satellite Radio standard. So that you can buy a receiver then someday choose a provider, instead of everything being proprietary. Maybe it will lead to them offering some channels for free, and a subscription for others. I would listen to free satellite radio even if it had commercials. When you drive a couple hours in the same direction you're bound to lose signal and have to find another station, not so with satellite.

Lets hope (1)

zappepcs (820751) | more than 7 years ago | (#18072480)

that the name of the merged company isn't iSatellite radio....

More Bandwidth? (3, Insightful)

Rudy Rodarte (597418) | more than 7 years ago | (#18072494)

As a huge O&A/Ron & Fez fan, I hope that the new company gets rid of some of the redundant stations (do we need 4 Top 20 stations?) and allocate more bandwidth to new stations. Maybe the Hideout boys and Ron & Fez get their own station while The Virus goes 24/7 O&A. Every time Ron and Fez mention "big things" for their show, ELo (Eric Logan) mentions the bandwidth issue.
Also, as a Big XII Alumni (Baylor,) hopefully they'll give us an option to start listening to Sirius content on XM. Oh, and there is that little league called the NFL.
I'm also curious to see how Opie and Anthony live working umnder the same umbrella as Howard Stern. Time will tell.

Re:More Bandwidth? (1)

can'tthinkofagoodnic (866970) | more than 7 years ago | (#18072906)

The redundant stations are one of the things that makes the service great! Don't like a song? Switch stations without changing genres. Something you can't really do with FM. I have 6 presets set to the same genre and I shuffle through them constantly--they all play the same music but not at the same time.

Re:More Bandwidth? (2, Funny)

speedy1161 (47255) | more than 7 years ago | (#18073146)

Ramonnnne... mod this parent up and let him into the Big Ass Prize Closet.

L'il Conner gave his mommy an XM for christmas, too bad it don't work under water.

Re:More Bandwidth? (0)

Anonymous Coward | more than 7 years ago | (#18073162)

You do realize though that in order to take advantage of this extra bandwidth, you'll need a new receiver...

It is unlikely either company's receivers have capability to tune the competitor's frequency range, decrypt the competitor's conditional access system, nor decode the audio stream's codec.

So just like the much heralded DTV/Echostar merger (ultimately nixed by the FTC), there is a long, long way to go before the benefits of such a merger would really be available to the consumer.

Do you think Congress would just let XM/Sirus throw a switch next month which would render useless all of the receivers currently out there? If not, then how do they accommodate all of the old receivers and provide new "bandwidth" to new receivers? Answer: they can't. They either have to wait and phase all of the old receivers out, or pay an outrageous fee out of their own pockets to give all current subs new hardware. Not likely.

standards? (1)

TechyImmigrant (175943) | more than 7 years ago | (#18072528)

I bet they now regret cooking up their own incompatible proprietary broadcast protocols to lock their service to the equipment.

There is such a thing as open standards.

Re:standards? (2, Insightful)

jandrese (485) | more than 7 years ago | (#18073296)

Don't they operate on similar bands though? How hard would it be to build a dual-protocol receiver now that they're merged? I assume the reason it hasn't been done before is because neither company will license their stuff to anybody who builds a dual protocol box.

business model? (3, Interesting)

The Only Druid (587299) | more than 7 years ago | (#18072600)

The thing everyone forgets is that monopoly isn't the problem: it's the abuse of monopoly to unfairly control a market.

XM and Sirius have so far both struggled for customers for several reasons, not the least of which being problems of customer awareness. Many people simply don't know - and won't learn without extensive research - which network would be better for them (in terms of content, quality and price). People are used to having one radio "network", expecting competitors to just be different channels. The idea of two separate networks with non-interoperable hardware just isn't what people want.

The question is how this new hybrid company (I love the AT&T joke...) will shape its new business model: if no other satellite companies emerge, will they offer channels 'for rent' to other content providers? Will they continue to own all channels? Etc.

Re:Yes, Virgil, Monopolies ARE a Problem (0, Troll)

mpapet (761907) | more than 7 years ago | (#18073350)

Another post rightly points out that being a monopolist is not on its face illegal but specific behaviours are. This is different than what I believe you are implying. In short, monopolies do a number of very harmful things:

1. Raise prices. (inevitable with SXm)
2. Reduce quantity available at a given price.
3. Eliminate the benefits of competition which are supposed to be things like lower prices, greater selection.

Most people won't or don't understand the graph, but it's clear consumers are harmed. The little yellow triangle says so: http://en.wikipedia.org/wiki/Monopoly#Price_settin g_for_unregulated_monopolies [wikipedia.org] .

I urge you to examine the issue carefully.

Advertisements soon (0)

Anonymous Coward | more than 7 years ago | (#18072628)

I remember when cable TV came out and it didnt have any advertisements, (yes, I'm really THAT old) the reasoning was, since your paying for the broadcast, you shouldnt "pay" for adversisments also. Well that was until they realized they could do ad's and still people would pay! With XM and Sirius, I predict they will begin to have ad's to. In doing so, they will hang themselves. This isnt like TV where good reception is a big issue.

Re:Advertisements soon (1)

can'tthinkofagoodnic (866970) | more than 7 years ago | (#18072950)

XM has always had ads. The talk radio programs are sold to AM, FM, and XM stations, and as such have gaps for ads. There's no way around this other than pre-taping the shows (which I would actually prefer). As such, the talk stations have just as many ads as a regular station.

Clearchannel recently forced XM to put ads in their music stations as well, so some of the music stations have ads (although there are generally clone stations that do not).

Reminds me of the Onion article (2, Funny)

evwah (954864) | more than 7 years ago | (#18072700)

All Corporations Merge Into OmniCorp
Saturday, Jan 1, 2000

UNITED NATIONS - In a multimedia press conference held Friday at the U.N., top executives from the world's three remaining corporations announced a final merger, uniting the planet's financial resources under the newly created OmniCorp.

Under the terms of the record $9.2 quadrillion merger, the Global Tetrahedron Conglomerate gains controlling shares of its two final competitors, Time-WarTurABCDis-SonylumbiaAT&T and GM-LockheedZweibSKGBank, creating what company spokespersons called "an unstoppable juggernaut wielding unparalleled wealth and power."

As a cost-saving measure, dealmakers also negotiated the absorption of all world governments into OmniCorp, making the corporate behemoth the sole ruler of mankind.

"We stand at the close of a century of progress and at a dawn of a new millennium," said OmniCorp spokesperson Ed Rohl. "One hundred years ago, the average working Joe was at the mercy of the big corporate trusts. Now, as a new century looms, we can celebrate just how far we have come."

Key members of OmniCorp's board of directors, including Walt Disney, were cryogenically unfrozen and revived by a team of shadow-government technicians. They are expected to assume overlord duties as early as Thursday.

Re:Reminds me of the Onion article (1, Insightful)

Anonymous Coward | more than 7 years ago | (#18073010)

As a cost-saving measure, dealmakers also negotiated the absorption of all world governments into OmniCorp, making the corporate behemoth the sole ruler of mankind.

Communism: The Endgame of Capitalism

Where you use it most - in the car (2, Interesting)

Ethercircuit (1057996) | more than 7 years ago | (#18072838)

I've always liked XM better than Sirius for their indie and alternative channels. (I think sirius only has one named alt nation?) When I bought my 2007 BMW they wanted $600 to integrate Sirius. No XM was offered. I declined and instead opted for the $50 XM roady xt aftermarket. If this goes through how soon would auto makers offer the hybrid service? Right now GM and a few others offer XM while most imports offer Sirius. It would suck to buy a 2008 car and be locked into only one side's hardware.

Yeah Capitalism (2, Interesting)

eno2001 (527078) | more than 7 years ago | (#18072876)

We now have another monopoly with little chance of any kind of alternative as the barrier to entry is so high. I trust this means that there will be less content available than ever before. You'll only hear what's "popular" (ie. what they want you to buy this week). I'm just waiting for ClearChannel to buy the new company. Fortunately the only experience I've ever had with satellite radio is via DirecTV (another near monopoly that's hard to avoid if your local cable outlet sucks ass). Before they started touting their affiliation with XM, DirecTV used to have some "Digital Radio" channels. They were actually pretty good. Then the XP partnership happened and those channels were replaced with godawful crap.

My wife used to love the 80s music channel they had under the old system. But now they replaced that with "Ethel" or "Fred" or somesuch, and it sucks ass. The selection isn't as good as it used to be. And invariably they wind up throwing in stuff that doesn't even fit. The "80s" channel they have now has a "wider" definition (ie. only what they consider to be 80s instead of what was REALLY definitive 80s) of 80s in that it doesn't just feature punk and new wave stuff like the old one. Now they throw in all sorts of things (some of which aren't even 80s) that are vaguely "alternative" with the occasional crap country song thrown in. My guess is that since country is such a popular format (even though it sucks ass in my opinion) they are hoping that by dropping in an occasional tune, they might get some new buyers from people on the fence.

Yet another annoying factor is that the old system used to tell you on screen what was currently playing and which album it was from. It was very informative. The new system just gives you a little info and 90% of the time it's completely wrong. If that's what XM is like, then they can shove it. I hope they die a spectacular death because music lovers don't want satellite or subscription radio. Music lovers want a smörgåsbord of endless new and old music that is either thrown in as a "freebie" or totally free. And if the selection is varied enough, THEN and ONLY THEN will the music lover plunk down the cash for the goods. That's the way I roll. I listen to college radio and the BBC via the net (and I'm approaching 40) because in many markets it's the only place to hear good new music. If it's good enough, I check and see if eMusic has it and download it. If not, then I get it from Amazon on CD. Satellite radio is only for boring old people who still think Cadillacs are cool looking cars or who think they're being radical when they buy a modern Volkswagen Beetle. LastFM is about the only other option, but I fear that it will be pounced on by the big players and hence ruined once they reach a certain critical mass.

Re:Yeah Capitalism (-1, Flamebait)

Anonymous Coward | more than 7 years ago | (#18072968)

wow, i guess you never really did have an XM or Sirius subscription. I listen to both every day, at one point or another it's either XM or Sirius. What you described is not even remotely true. Artist & Title can be found on screen. What they play fits the channel description, and both of these statements hold true for both services. How about you quit dickin around with your DirectTV setup and get into a store with some actual equipment and get the real deal, instead of complaining over something that's not even truely the way you describe it.

Re:Yeah Capitalism (1)

MikeBabcock (65886) | more than 7 years ago | (#18073366)

Take the money you would've spent on satellite radio in the next 6 months (as well as the receiver) and purchase random recommended songs off iTunes (subscribe to last.fm [last.fm] for a good recommendation list based on your own tastes) or some other service instead, then bring them with you on random shuffle play.

I listen to CDs or other personal audio half the time (unless one of the shows I like on CBC radio [radio.cbc.ca] happens to be on the radio, or the news). Paying for music I might not want to listen to strikes me as odd, personally.

Satellights not (1)

Tablizer (95088) | more than 7 years ago | (#18073378)

We now have another monopoly with little chance of any kind of alternative as the barrier to entry is so high.

In both a literal and figurative sense.
       

A bit worried (4, Insightful)

m3gatr0nX (1066120) | more than 7 years ago | (#18072890)

As a Sirius subscriber, I'm a bit worried what a merger, if approved, might bring. They mention a more a la carte selection of channels. I read this as "tiered" pricing. If I had to guess, it sounds like it will be more modeled after the pay-for-tv pricing...i.e. you get a basic package for x dollars, a premium packages for y dollars, oh and you want the sports package? thats an extra z dollars. If it goes that route, I'm really going to have to reconsider if it is really worth it to me. Overall I've been happy with the Sirius service and choice of programming they've had. All for one price keeps it simple and affordable. Any changes to that, which are bound to happen in a merger like this, chances are the consumer loses.

Gettin' it free! (1, Flamebait)

decipher_saint (72686) | more than 7 years ago | (#18072924)

Turns on trusty shortwave radio...

Holy crap a revolution! I get my radio for FREEEEEE!

Re:Gettin' it free! (1)

Ethercircuit (1057996) | more than 7 years ago | (#18072964)

is it really 'free' if you are forced to listen to advertising? To me thats the whole point of paying 12 bucks a month for XM. (The same goes with paying for DVR on cable/sat tv, skipping the comercials is the best part)

Re:Gettin' it free! (1)

dahl_ag (415660) | more than 7 years ago | (#18073218)

It always amazes me that so many people don't understand / accept the idea of paying for radio. Is this really such a different idea from paying for cable tv? In both cases, you pay to be able to select from tens or hundreds of stations rather than being limited to a handful of 'free' broadcast radio / tv stations.

Re:Gettin' it free! (1)

GeeBee (104073) | more than 7 years ago | (#18073428)

Have you actually listened to shortwave lately? If you enjoy listening to religious stuff or the guys in the tinfoil hats, then it's for you.

I've been an XM subscriber since 2003. I see little to nothing good to come out of this merger for subscribers. I definitely see "a la carte" as "tiered" and it will definitely cost me more money to get what I have now. One thing that I've loved about the single, low, monthly price is that it was all there. If I choose to try something I don't normally listen to, it is there and I don't have to pay extra for so-called "premium" content. If the FCC approves of this, and that is a large "if", they stand to lose many of their current subscribers if they are not very careful with content, pricing, and any needed equipment swaps.

The big question: (1)

Upaut (670171) | more than 7 years ago | (#18072956)

Will this merger affect my Playboy Radio? I mean I signed up to XM in the first place for it, and when they cancelled it, I cancelled my subscription... Now Sirus has it, I worry about if it will be dropped again...
 
Got to love Playboy radio...

Start the death watch! (0)

8127972 (73495) | more than 7 years ago | (#18073004)

Face it. The satellite-radio business is one that won't last. The idea of paying for commercial-free radio service is NOT going to generate enough customers to cover the cost of operating the business. Period! How many customers of XM or Sirrus are trial customers who got satellite-radio free for a year when they bought a new car? Lots I would suspect. How many of these people are really going to re-new their contracts? Not many I suspect.

This is simply a last ditch effort to keep themselves afloat. Nothing more. They'll be dead shortly. But at least Howard Stern would have made a pile of money.

Re:Start the death watch! (2)

can'tthinkofagoodnic (866970) | more than 7 years ago | (#18073090)

Gotta disagree--the free 3 months of XM in my car got me hooked, and after I had it for a while my wife *had* to have it. We both have long commutes, and having the selection it offers is well worth the money to us. It's like cable tv--I'm not paying for commercial free so much as paying for selection.

Re:Start the death watch! (1)

Oswald (235719) | more than 7 years ago | (#18073168)

You've never had either service, have you? I don't know a single person who has tried satellite radio who has stopped subscribing. If it ever goes away, I will miss it forever.

Why would anyone pay for radio subscription? (0)

Anonymous Coward | more than 7 years ago | (#18073108)

It's dumb. Dumb people is their demographic.

Re:Why would anyone pay for radio subscription? (2)

SnapperHead (178050) | more than 7 years ago | (#18073348)

Its called, when I get in my car I want to listen to music ... not 47 car commercials, 2 ads for viagra, 6 plugs for the station I am already listening to, and 5 clips from songs that I would rather be listening to.

I have little patience for advertisements. I would rather pay for XM / Sirius then listen to that crap. Not to mention, look at how many more channels you get.

I am gonna take a guess that you either have no or only basic cable. I personally have full cable with 3 premium channels. (too expensive to have all 5) I don't see any difference between getting cable and getting satellite radio.

Yes, most cable channels have advertisements but I spend 80% of my time watching channels that are in HD. (For the most part, HBO, Showtime and Starz)

If I could pay more for cable that doesn't have advertisements, you better believe I would order it right away.

Something I've always wanted to do. (2, Funny)

pseudosero (1037784) | more than 7 years ago | (#18073114)

Ever since I was a small boy trying to get the FM reception just right, I've always wanted to pay for radio.
Not just listen to advertisements, That's not enough of a contribution.

Oh, and I wanted it to sound like it was in a box, with lots of neat clipping and compression artifacts, instead of free fuzzy fm frequencies.

Yahoo! News doesn't report anything (2, Informative)

Pap22 (1054324) | more than 7 years ago | (#18073166)

Yahoo! News is not a news agency. They have no reporters. They have a license to publish news reported by various news agencies, such as the AP, Reuters, NYT, etc.

This particular article was reported by AP Business (Seth Sutel). The page even has the Associated Press logo at the top right.

Not very difficult.

regarding monoply comments... (1)

spoonyfork (23307) | more than 7 years ago | (#18073192)

Being a monopoly does not necessarily mean all of its behavior is monopolistic. Uncompetitive behavior by a monopoly can sometimes be illegal and bad. Being a monopoly is not illegal or even necessarily bad.

XM/Sirius (1)

certel (849946) | more than 7 years ago | (#18073386)

I hope that they retain the XM name. It's fitting.
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