Former FCC Chairman Fowler In Favor of Merger
It’s no secret that Sirius and XM have been getting a fairly impressive amount of support for the proposed merger with more the 4300 individuals and 30 organizations, and now they can add former FCC chairman Mark Fowler to the list. Fowler was FCC chairman during the Reagan administration and has the distinction of holding that post longer than any other person in history of the FCC. For this reason his opinion would naturally have more influence than the average supporter.
It’s starting to feel that some momentum is building in favor of the merger, and the stock has been rewarded by rising over 8% over the last 3 trading days. Sirius and XM expect the merger question to be settled by the end of the year.
Mr. Fowlers Opinion:
As chairman of the Federal Communications Commission in 1981, I was
visited by a lobbyist for the broadcast industry. Over-the-air
broadcasters vehemently opposed the FCC’s authorization of Direct
Broadcast Satellite television services, and the lobbyist quickly launched
into his preamble: “We are all for competition, Mr. Chairman, but… ”Meaning, “forget what I said up to the word ‘but,’ and now listen
carefully…”In observing the broadcasters’ intense negative reaction to the proposed
merger of the two satellite radio companies, XM and SIRIUS, it struck me
that little has changed in 26 years. Each year, the skies over Washington
darken as the Lear jets bring industry lobbyists to the latest battlefront
against competition and its offshoot — mergers that enhance competition.In 1981, we were only beginning to envision the possibilities of
satellite-delivered entertainment media services. Twenty-six years later,
we live in an entertainment media marketplace that features a striking –
and exciting — competitive dynamic beyond anything we could have
envisioned. Although traditional over-the-air radio remains the most
dominant audio entertainment platform, continued technological innovation
has forced broadcasters to confront that they must offer better service
and more choices to consumers if they are to compete and survive.Satellite radio offers a perfect example of the phenomenon. Although it is
a relatively nascent service, launched a little more than five years ago,
satellite radio today offers diverse programming targeted to many
audiences and tastes, largely on a commercial-free basis, using very
high-quality digital signals.And, in spite of the fact that satellite radio constitutes only 3.4% of
radio listening today, traditional over-the-air radio operators have
understood the potential threat and have had no choice but to compete, and
have been dragged, albeit kicking and screaming, into the digital age.Thus, the broadcast industry recently introduced and is pushing its own
“HD Radio” initiative to allow radio stations across the country to offer
multiple new, high-quality digital channels.This is all to consumers’ benefit. In the mean time, satellite and
terrestrial radio also have been besieged by a host of additional
competitors: iPods and other MP3 players, Internet radio services, and now
mobile phones. All offer exciting new means of providing audio
entertainment to consumers.That is how things should be. Indeed, it is the precise dynamic that
American communications and entertainment media policy should continue to
foment. If the two satellite radio companies, each only several years old,
need to combine to be more effective competitors in an audio entertainment
marketplace teeming with technological change and innovation, the
government should not stand in the way.In the end, satellite radio may or may not survive, but let that be
decided by the people through their electronic choices in the marketplace.Mark Fowler served as Chairman of the Federal Communications Commission
during the administration of President Ronald Reagan
And, in spite of the fact that satellite radio constitutes only 3.4% of
radio listening today, traditional over-the-air radio operators have
understood the potential threat and have had no choice but to compete, and
have been dragged, albeit kicking and screaming, into the digital age.
Thus, the broadcast industry recently introduced and is pushing its own
"HD Radio" initiative to allow radio stations across the country to offer
multiple new, high-quality digital channels.
Every form of audio entertainment will be forced to remain innovative and continue to evolve through the increase in quality competition. by MBrock1974
Every form of audio entertainment will be forced to remain innovative and continue to evolve through the increase in quality competition.
Anybody know more about a timetable for the merger. The other night my buddy asked me about it. I told him it wasnt done. He said "they still havent taken care of that yet".
Lets get this overwith already. by tgajr
SIRIUS and XM's real competition isn't each other... wake up and smell the coffee! by DAB
SIRIUS and XM's real competition isn't each other... wake up and smell the coffee!
I like the two services for what they are they way they are now. My concern is that after the merger they may end up picking one of the two vastly different musical programming philosophies, and not the right one or we as subs are going to stuck with something that is very middle of the road and mediocre. I like that now if Sirius changes I can listen to XM and is XM changes I can go to Sirius. That will be gone.
Maybe if they put out a detailed plan about what the service were going to be like after the approval it would ease my concerns. by Fergz99
See you've made my point perfectly about not thinking outside the box. In your mind the only competion is between XM and SIRIUS. But for many of us that aren't stuck in that box that have iPod's, Sansa Players with Wifi, we are far from being stuck.
In fact with the latter two items I become the programmer and it is all about my philosophy. In fact I can program it where I never hear the same song for 7 days or more. I can do mixes of genres, specific artist. I listen to full albums. You see I am not nearly as lazy as those SIRIUS and XM programmers. I get just what I want when I want it and I enjoy creating the content for myself. Because I rock! LOL
I have always enjoyed Sat Radio, but rather there are two or rather there is one... It will NEVER be my only source for digital music and entertainment. Competition in the digital music age is GREAT! XM and SIRIUS combined just makes more sense as we move forward.
I see a better than 50% chance of this merger being approved! If it is or if isn't will not change the fact that I love being in the middle of the new digital age of music and entertainment and I refuse to lock myself into just sat radio.
Now don't even get my started on AM/FM because that is SIRIUS and XM's biggest competition because many, they just can't see why anyone would be stupid enough to pay for something they already can get for free. So I also see a merged company as better being able to convince or market themselves in such a fashion as to be able to really draw in the millions and millions of subscribers necessary to be truly successful and make money for their stock holders. XM and SIRIUS right now currently have less than 4% of the radio market PERIOD! So the strategy going forward doesn't need to be XM competing with SIRIUS or vice versa. No it needs to be the new XM/SIRIUS kicking the shit out of FM! That is how they will survive and be a true viable player in the digital music/entertainment industry going forward! Satellite that is just the delivery method... Mel's play is that this combined company will be a player digital music/entertainment industry and if folks can't see that, they truly are stuck in a box and can't see beyond it.
Okay if you look at AM/FM and they are already financially declining and we can see that XM and SIRIUS has really only made a dent in overall radio market. What is going on? OH it must be all those darn digital music players out there (the stats for digital music is off the charts and steady growing) Anyone silly enough not to see that Apple, Microsoft, Yahoo, Napster, Rhapsody, Urge and eventually Slacker aren't after the same customers not only are stuck in the box, but they are totally freaking blind too. Yet folks like you Fergz keep saying we'll be stuck with no competition or variety? Oh Really? NOT ME! LOL
Anyway... there is little doubt I support this merger and I hope and pray these FCC chairman and commissioners will really look at this overall and see that XM and SIRIUS are mere players in a huge digital music/entertainment industry and that competition is GOOD! by DAB
I'll be happy when this is decided one way or the other which according to XM and Sirius should be by the end of the year. by Manco
See you've made my point perfectly about not thinking outside the box. In your mind the only competion is between XM and SIRIUS. But for many of us that aren't stuck in that box that have iPod's, Sansa Players with Wifi, we are far from being stuck.
Anyway... there is little doubt I support this merger and I hope and pray these FCC chairman and commissioners will really look at this overall and see that XM and SIRIUS are mere players in a huge digital music/entertainment industry and that competition is GOOD!
Saying that because mp3 players and wifi players are available so when the merger ruins these companies we can switch to one of those options to me is nonsense. I have a lot of money tied up in equipment, have multiple subs on both, and have family members that I have given the service to as gifts. I would rather not have to replace all of these items because an unnecessary merger killed the medium just so that Mel and Howard and people like that could make a few more million on their stock. by Fergz99
Saying that because mp3 players and wifi players are available so when the merger ruins these companies we can switch to one of those options to me is nonsense. I have a lot of money tied up in equipment, have multiple subs on both, and have family members that I have given the service to as gifts. I would rather not have to replace all of these items because an unnecessary merger killed the medium just so that Mel and Howard and people like that could make a few more million on their stock.
I understand you don't want anything to change, but you know what, you may just have to suck that up because if this merger goes through changes are coming. Both have said they don't need to merger, but that is what they have to say because they don't want the FCC to think they are doing it to survive, but I think in the long run that is exactly the case regardless of what either of them say.
One rock solid sat company vs two weaker ones just makes sense and I've just not seen anything in your arguement except you want what you want which is nothing more than a personal preference. I see this from the perspective of them competing and being around as a viable business in the digital age that we live in. You can say iPods and MP3 playes as an alternative is nonsense, but those guys are laughing all the way to the bank and they aren't struggling to survive. In fact I'd say many of them are taking it right to SIRIUS and XM and many potential subscribers are still opting to get those devices over sat radio. So argue all you want! by DAB
Damn you and your yahoo music !
This is all to consumers' benefit. In the mean time, satellite and terrestrial radio also have been besieged by a host of additional competitors: iPods and other MP3 players, Internet radio services, and now mobile phones. All offer exciting new means of providing audio entertainment to consumers.
In the end, satellite radio may or may not survive, but let that be decided by the people through their electronic choices in the marketplace.
It should be fairly obvious that the NAB is doing everything they can to squelch this merger. Why? Because they would be forced to compete a magnitude more than they already do. As a free service competing against a paid service, with near a century of governmental support and oversight, and having over 96 percent of the customer base, the outcome should be fairly predictable. Why are they worried?
Probably for the same reason the automobile giants were worried when Preston Tucker tried to show Americans what his ideal of an automobile could and would be. IMO, it wasn't really greed or financial concern that agitated the biggies. It was hubris. The David of satrad has challenged the Goliath of terrad. The damage they have done so far is minor, a pin prick, but, oh how mad they are!
Perhaps I underestimate the NAB, though. Perhaps they realize that by stomping satrad into the ground, they will have a precident for eliminating future competition. Perhaps they will become better at it, so that upstarts will be ruined so quickly no one will take a chance on new technology or innovative service.
If I find satrad's service unacceptable or too costly, I will cancel. That is true now and will be true if the merger happens. Based on many of Sirius' and XM's past decisions, I suspect it will happen, eventually. I predict some Harvard educated MBA will make it a point to charge as much as possible once the government mandated moratorium on prices expires. XM already did it. Sirius threatened to do so. I dropped XM. I was ready to drop Sirius. Satrad has a built-in governer for change. No one is forced to subscribe.
Fowler had it right. The NAB is protecting their own interests, not the consumer's. And satrad cannot afford to disaffect their subscribers. Not now. Not soon. Probably, not ever. by Capn Ramius
If a merger was going to "kill" SatRadio, then the NAB wouldn't be spending millions of dollars and thousands of manhours attempting to defeat it. They would be supporting it instead. by Serious_Sirius
If they merge and unify as one company, they would then be able to pool their financial resources and genuinely improve SatRadio. Which would make them better able to compete against iPods, terrestrial radio, cellphone providers that offer music etc.
If a merger is successful, hopefully they will be allotted the full spectrum of bandwidth, instead of just half. They would then be able to combine channels that are basically very similar, and add new niche channels for genres that are currently underrepresented or absent.
For example, they could combine the decades channels, and create new channels for swing, prog, funk etc. by Serious_Sirius
Some people prefer Sirius' programming of music better then XM's, and others like XM. YOu aren't going to be able to keep everyone happy. by Minqua
Without Stern there would be no Sirius. The end. by rustytrombone
Without Stern there would be no Sirius. The end.
If it was such a great deal why aren't they turning a profit with him yet ? Company is bleeding money but they can give him 100 million to work 1/3 of the year ? by Minqua
Since Stern came on board, Siri now controls at least 60% of the retail market, and they've made significant inroads into XM's OEM advantage. XM's subscriber lead has been cut from more than 3 million to less than 1 million.
Sirius has dominated at retail every quarter for the last two years, with no end in sight. Siri has steadily reduced their debt and subscriber acquisition costs.
Stern is the best thing that ever happened to Sirius, even at the substantial sum they paid for him. by Serious_Sirius
If it was such a great deal why aren't they turning a profit with him yet ? Company is bleeding money but they can give him 100 million to work 1/3 of the year ?
Since Stern came on board, Siri now controls at least 60% of the retail market, and they've made significant inroads into XM's OEM advantage. XM's subscriber lead has been cut from more than 3 million to less than 1 million.
Sirius has dominated at retail every quarter for the last two years, with no end in sight. Siri has steadily reduced their debt and subscriber acquisition costs.
Stern is the best thing that ever happened to Sirius, even at the substantial sum they paid for him.
Why would XM need to merge??? Because they're competing against FREE. Do you know how hard it is to compete against FREE?? That's why the RIAA is spending MILLIONS/year to combat online piracy. by badmotherfarker
If XM was offering $35 million, how is paying him over $100 million per year (3x as much) NOT overpaying him? I'm all for market-set pricing, but Sirius payed way over market value. by RoadRunner
Corporate acquistions/mergers happen on a virtual daily basis in the business world, because people who understand business know it's good for business. by Serious_Sirius
If XM was offering $35 million, how is paying him over $100 million per year (3x as much) NOT overpaying him? I'm all for market-set pricing, but Sirius payed way over market value.
(here's the Backstage thread with some quotes...http://www.siriusbackstage.com/forum...ad.php?t=71775)
and it looks like I was wrong, the XM offer was only (LOL) $30 million/year. by RoadRunner
If XM was offering $35 million, how is paying him over $100 million per year (3x as much) NOT overpaying him? I'm all for market-set pricing, but Sirius payed way over market value.
100 million a year is Stern's BUDGET for the show. Besides paying his own salary the money has to pay for ALL operating/programming expenses. We're talking about having to pay talent/guests for appearances, pay for a significant staff to come up with material, broadcast staff, expenses for promotional/publicity staff, etc. etc.
I don't think you understand just how much it costs per year to run an operation that size, and how many people it ultimately involves.
The Stern deal was one of the most massive undertakings in radio history. You can do it half-ass by working on a shoestring budget like CBS or XM would have given him, or you can give him the money to do it RIGHT. Which is what Sirius gave him!
If Sirius had given him a crappy budget like CBS and XM wanted to, the show wouldn't be near as popular as it has been, and Sirius would still be soundly losing the Sat Radio race with XM.
Instead, they're now poised to acquire their only SatRad competitor, and move into the future in complete control of the SatRad industry.
Stern has been worth EVERY cent they've given him, including the stock bonuses. by Serious_Sirius
I have NEVER listened to Stern on Sirius or terrestrial, and have no interest of starting.
The guy does nothing for me as an entertainer. However, I do understand enough about business to know that he's been DARN good for business at Sirius! by Serious_Sirius
Sirius gave Stern an operating budget of 100 mill a year, which has put them in the dominant position in the SatRad industry, when only about two short years ago they were firmly entrenched in last place. by Serious_Sirius
100 million a year is Stern's BUDGET for the show. Besides paying his own salary the money has to pay for ALL operating/programming expenses. We're talking about having to pay talent/guests for appearances, pay for a significant staff to come up with material, broadcast staff, expenses for promotional/publicity staff, etc. etc.
Or here's another question that makes all the others meaningless; Would Howard have signed with Sirius for $90 million/year? If the answer is yes, then Sirius overpaid by $10 million... by RoadRunner
The stock options were an incentive to get him to bring in subscribers. They are targeted, requiring certain subscriber growth to receive them. by Manco
Bingo! Howard was already set for life financially, a few million more would've meant nothing to him, especially since SatRadio was a big question mark to a lot of people at the time. A bird in hand is worth two in the bush, and he would've stayed right where he was at.
He wanted a HIGH BUDGET show, in order to produce a show the likes of had never been heard on radio, terrestrial or satellite. Free from the hindrance of FCC regulations.
Sirius gave him that chance, and he delivered in spades. Siri went from distant last place to the driver's seat in the SatRadio industry. Thanks to Howard, the Sirius name and logo are synonomous with sat radio in the minds of millions of Americans.
He virtually single-handedly brought XM to its knees. Now XM's management and stockholders are begging for Sirius to step in and rescue them via acquisition.
"The stock options were an incentive to get him to bring in subscribers. They are targeted, requiring certain subscriber growth to receive them."
Whoop, dey it is! All the stock options were up front in the original contract. Howard delivered the numbers he said he would, and he was appropriately and legally rewarded for doing so. That's how it works in the business world.
Money talks and BS walks, which can also be correctly phrased as "Howard talks and his critics walk".
The stock options were an incentive to get him to bring in subscribers. They are targeted, requiring certain subscriber growth to receive them.
And please remember I started my participation in this thread by recognizing Howard's value! I think Sirius was right to sign him. I just think they offered (far) more than they needed to in order to sign him.
I also have no argument with the stock options...he did what was required to earn them. My only point in raising them was to counter the argument that the money doesn't go into Howard's pocket, that it's primarily to provide for a show expenses. I rarely listen, but haven't seen any evidence (and this is wandering into Stern forum territory) that the show is, say, $50 million/year better produced than when it was on terrestrial. Besides, wouldn't it have looked better (from Sirius' POV) if they had announced that they signed him to a $50 million/year contract as talent (almost double XM's offer) and also hired him as a channel consultant with a budget authority of $50 million/year. Certainly could have deflected some of the stockholders concerns about overpaying talent, and would have acted as a brake on the spending spree.
Anyway, we've wandered far off topic, so I'll surrender. by RoadRunner
Sirius gave Stern an operating budget of 100 mill a year, which has put them in the dominant position in the SatRad industry, when only about two short years ago they were firmly entrenched in last place.
And please remember I started my participation in this thread by recognizing Howard's value! I think Sirius was right to sign him. I just think they offered (far) more than they needed to in order to sign him.
I also have no argument with the stock options...he did what was required to earn them. My only point in raising them was to counter the argument that the money doesn't go into Howard's pocket, that it's primarily to provide for a show expenses. I rarely listen, but haven't seen any evidence (and this is wandering into Stern forum territory) that the show is, say, $50 million/year better produced than when it was on terrestrial. Besides, wouldn't it have looked better (from Sirius' POV) if they had announced that they signed him to a $50 million/year contract as talent (almost double XM's offer) and also hired him as a channel consultant with a budget authority of $50 million/year. Certainly could have deflected some of the stockholders concerns about overpaying talent, and would have acted as a brake on the spending spree.
Anyway, we've wandered far off topic, so I'll surrender.
Gee, if that was true, why are XM management and stockholders pushing so hard for Sirius to acquire them?
I'll tell you why, because from a business/financial standpoint, Sirius is handing them their a$$.
XM needs more subscribers, LOTS more subscribers. Oprah has failed miserably to bring them in, and the advertising revenue she has brought in is a drop in the bucket, compared to what they need to stay afloat if the merger is rejected. by Serious_Sirius
Even if your phony claim was true, there are a LOT more expenses involved in running a radio operation of that size than employee salaries.
No offense, but you simply don't have a clue.
He virtually single-handedly brought XM to its knees. Now XM's management and stockholders are begging for Sirius to step in and rescue them via acquisition.
Even if your phony claim was true, there are a LOT more expenses involved in running a radio operation of that size than employee salaries.
No offense, but you simply don't have a clue.
There is no new programming on weekends. Where is he spending? by k9feces
There is no new programming on weekends. Where is he spending?