DoJ approves Merger
OK, technically, they didn’t approve it, they choose not to oppose it, but to subscribers this may be a difference without a distinction. Here’s the press release from Sirius. http://investor.sirius.com/ReleaseDetail.cfm?ReleaseID=301291
SIRIUS Satellite Radio (Nasdaq: SIRI) and XM Satellite Radio (Nasdaq: XMSR) today announced that the U.S. Department of Justice (DOJ) has informed the companies that it has ended its investigation into the pending merger of SIRIUS and XM without taking action to block the transaction. This decision means the DOJ has concluded that the merger is not anti-competitive and it will allow the transaction to proceed. SIRIUS and XM each obtained stockholder approval in November 2007. The pending merger is still subject to approval of the Federal Communications Commission.
Here’s the DoJ’s spin…http://www.usdoj.gov/opa/pr/2008/March/08_at_226.html
The Division’s investigation indicated that the parties are not likely to compete with respect to many segments of the satellite radio business even in the absence of the merger. Because customers must acquire equipment that is specialized to the satellite radio service to which they subscribe, and which cannot receive the other provider’s signal, there has never been significant competition for customers who have already subscribed to one or the other service. For potential new subscribers, past competition has resulted in XM and Sirius entering long-term, sole-source contracts that provide incentives to all of the major auto manufacturers to install their radios in new vehicles. The car manufacturer channel accounts for a large and growing share of all satellite radio sales; yet, as a result of these contracts, there is not likely to be significant further competition between the parties for satellite radio equipment and service sold through this channel for many years. In the retail channel, where the parties likely would continue to compete to attract new subscribers absent the merger, the Division found that the evidence did not support defining a market limited to the two satellite radio firms that would exclude various alternative sources for audio entertainment, and similarly did not establish that the combined firm could profitably sustain an increased price to satellite radio consumers. Substantial cost savings likely to flow from the transaction also undermined any inference of competitive harm. Finally, the likely evolution of technology in the future, including the expected introduction in the next several years of mobile broadband Internet devices, made it even more unlikely that the transaction would harm consumers in the longer term. Accordingly, the Division has closed its investigation of the proposed merger.
Justice Department approves XM-Sirius radio deal
Eds: APNewsNow. Moving on general news and financial services.
WASHINGTON (AP) - The Justice Department has approved Sirius
Satellite Radio's $5 billion buyout of rival XM Satellite Radio.
The merger was approved despite opposition from consumer groups
and an intense lobbying campaign by the land-based radio industry.
Regulators said the merger is not likely to substantially hurt
competition or consumers
.
(Copyright 2008 by The Associated Press. All Rights Reserved.) by Hofstra Handles
But I did figure the merger would pass, so bought SIRI shares 2 weeks ago. I'm kind of happy on the financial front
Note that we still have to see what the FCC decides. They can still say no to merging the two frequencies. by jwt873
<blockquote>SIRIUS Satellite Radio (Nasdaq: SIRI) and XM Satellite Radio (Nasdaq: XMSR) today announced that the U.S. Department of Justice (DOJ) has informed the companies that it has ended its investigation into the pending merger of SIRIUS and XM without taking action to block the transaction. This decision means the DOJ has concluded that the merger is not anti-competitive and it will allow the transaction to proceed. SIRIUS and XM each obtained stockholder approval in November 2007. The pending merger is still subject to approval of the Federal Communications Commission.</blockquote>
Here's the DoJ's spin...http://www.usdoj.gov/opa/pr/2008/March/08_at_226.html
<blockquote>The Division’s investigation indicated that the parties are <strong>not likely to compete</strong> with respect to many segments of the satellite radio business even in the absence of the merger. Because customers must acquire equipment that is specialized to the satellite radio service to which they subscribe, and which cannot receive the other provider’s signal, there <strong>has never been significant competition for customers</strong> who have already subscribed to one or the other service. For potential new subscribers, past competition has resulted in XM and Sirius entering long-term, sole-source contracts that provide incentives to all of the major auto manufacturers to install their radios in new vehicles. The car manufacturer channel accounts for a large and growing share of all satellite radio sales; yet, as a result of these contracts,<strong> there is not likely to be significant further competition between the parties for satellite radio equipment and service</strong> sold through this channel for many years. In the retail channel, where the parties likely would continue to compete to attract new subscribers absent the merger, the Division found that the evidence did not support defining a market limited to the two satellite radio firms that would exclude various alternative sources for audio entertainment, and similarly <strong>did not establish that the combined firm could profitably sustain an increased price</strong> to satellite radio consumers. Substantial cost savings likely to flow from the transaction also undermined any inference of competitive harm. Finally, the likely evolution of technology in the future, including the expected introduction in the next several years of mobile broadband Internet devices, made it even more unlikely that the transaction would harm consumers in the longer term. Accordingly, the Division has closed its investigation of the proposed merger.</blockquote> by RoadRunner
I got Sirius for Howard and was pleasantly surprised by everything else that came with it. XM was never and still isn't an alternative I need to look into so I'm not worried about losing that "option". by TheScionicMan
Keep in mind for you youngins...the government broke up AT&T in the early 80's so if Sirius/XM were to get to big they could always break them up.
Plus, as a HATER of commercial radio I think this will make them stronger if they take the correct approach. by eggbert52
Regards...JL by SRFast
In terms of radio programing,etc.,,, when will we see any differences? by SCJoe
In terms of radio programing,etc.,,, when will we see any differences?
I'm sure lots of people at both companies have spent a lot of time thinking about what to do about the programming post-merger, but it will still take time to make staffing decisions, and then actually decide which of those ideas to implement. Mel K. didn't become famous for driving programming; I think he doesn't really care one way or the other. So (IMHO) he'll allow that process to happen with others making the final calls. If Mel is convinced that he can cut costs quickly and easily by reducing "redundent" channels, it will happen more quickly. If he thinks the synergies and cost-saving come elsewhere, it will get back-burnered. by RoadRunner
From the DoJ release:
"Because customers must acquire equipment that is specialized to the satellite radio service to which they subscribe, and which cannot receive the other provider’s signal, there has never been significant competition for customers who have already subscribed to one or the other service."
I thought that the original FCC decree's for SDARS required the licensees to do something about interoperable radios. Now perhaps there was a fine line where the FCC said they had to develop one, but not release it (i.e. sell it). Then there was Mel's comment during the past year about him having one, but them not wanting to sell them because it invited owners of that kind of radio to change to the other service. So when reading the DoJ release, it seemed to me that by Sirius and XM dragging their feet on selling interoperable radios, they enhanced their argument at the DoJ about this deal not being anti-competitive.
I am also not convinced we've heard the end of this. Sure, the FCC can still deny the "merger" but I also believe that the DoJ decision can be appealed. Not sure if it will be, but given the high profile of this proposed "merger", I am also not sure an appeal is out of the question. In some ways it seems like the DoJ's release may have given some reasons and opened the door for anti-merger groups to argue other issues. For example, the DoJ release says:
" The Division’s investigation identified the mass-market retail channel as an arena in which XM and Sirius would compete with one another for the foreseeable future. Both XM and Sirius devote substantial effort and expense to attracting subscribers in this arena, with both companies offering discounts, most commonly in the form of equipment rebates, to attract consumers. Retail channel sales have dropped significantly since 2005, and the parties contended that the decline was accelerating. However, retail outlets still account for a large portion of the firms’ sales, and the Division was unable to determine with any certainty that this channel would not continue to be important in the future."
The DoJ appears here to recognize that XM and Sirius compete in the mass-market retail channel, and will continue to do so for the foreseeable future, even in light of accelerating decline in that area. They also recognized that it accounts for a large portion of their sales. It would be nice to see some quantification of "foreseeable future" and compare that to the real numbers for past "accelerating decline" and projections of that decline future. In other words, when does the competition in the retail space become something other than, well, competition?
Finally, I came away thinking that some of the DoJ's release was double-speak. Now as I said earlier, I still want to digest it some more.
I did have to laugh at DoJ stating "digital sound quality" like that meant something positive. I wish the FCC would order XM and Sirius to provide CD-like quality, or better yet, uncompressed-like quality. Now that would mean something good, heh, heh, heh! by HomieG
That's all I ask. by AlamoSpursFan
As BMF said there is also a lot of opportunity for consolidation at the corporate level and moving out of NYC would be a huge savings. It is also quite possible that there would be some other operational and technical savings. by dantodd
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It already has on this announcement.
Stock jumped up by .25 cents to $3.15 and should go higher when fcc approves.
CASTRO DIDN'T GET ANY ACTION FROM MARILYN MONROE, SO HE KILLED JFK.
DRILLBIT TAYLOR by Trap
And for the record it would take a quarter or so to see this really happen I only meant they could start the process immediately and it would likely be the first priority. by dantodd
1. SQ above all
2. Content
3. The FCC rules that they make the companies accept, i.e. censorship.
Homie I too would love that they forced CD quality or no compression hehehehe. At least put a cap on the max channels they can use per stream.
Interesting times ahead for sure. I put my billing to monthly so that I am not in any long term contract just in case. by D0TC0M
http://www.orbitcast.com/archives/sa...erger-faq.html
As far as when things get married together, there is no timeline:
No timeline has been set, however, we will seek to integrate the companies and technology platforms as quickly as possible, while supporting both Sirius and XM customers. We will be thoroughly evaluating all technology to ensure the best system for our customers is used going forward. Both companies are committed to ensuring the smoothest possible transition for customers who already have factory-installed satellite radio, and we do not anticipate any interruptions in service.
If the FCC puts conditions like making the Georgetown Assholes part of the deal, I hope both XM & Sirius have to balls to walk away. by IdRatherBeSkiing
IdRatherBeSkiing: Don't bet that you can put an XM radio on your Sirius sub as a FnF discount. by dantodd
No. I will have less. Right now I have all XM and all Sirius. Now 1/2 of the channels will be duplicated on each service. I lost 1/2 my choice. Oh they will squeeze 11 more channels on each (duplicates to dual subs of course) and either drop 11 current channels or cut the bandwidth. Its not like they have comatable services and they have said no radio will stop working. by IdRatherBeSkiing
Sports contracts will be premium with a-la-carte radios. The contracts would also need to be re-negotiated to make this possible. by IdRatherBeSkiing
I think that is almost 100% guarenteed not to happen. NASCAR would need to have its contract renegotiated (for more $). I think I also read that sports will not be included in the best of packages which is the only thing that would be made available on existing radios (for a price). by IdRatherBeSkiing
The FCC has no right to change the way the company runs..either you let them merge or you don't..... no stipulations!!! Apparently the DOJ has no problem with the way it is run...
SO F'OFF FCC!!!!
I like to know, can I get XM stuff on my Stiletto 2? Because I don't care, if I have to buy a new unit to get both! by WolfViper
If they do merge, the path to profitability is at least possible.
If you want satellite radio to continue beyond 2010, the merger is the only way. Without the merger, both Sirius and XM go broke and we all lose. by Skyline
I did not say they would not honour their existing agreements. But their existing agreements do not allow for broadcast of MLB on the Sirius side or NFL on the XM side as examples. To do that they would need to re-negotiate the sports contracts.
I am certainly not happy about the merger, but I think a lot of people are for the merger for reasons such as MLB on Sirius or NASCAR on XM which just will not happen in the short term. by IdRatherBeSkiing
I like to know, can I get XM stuff on my Stiletto 2? Because I don't care, if I have to buy a new unit to get both!
You will need a new unit with combined chipsets. by IdRatherBeSkiing
Skyline-
You make a fair enough point, however I have to disagree. Yes, perhaps one would have went out, leaving the other to quite possibly succeed. OR if one (or both) began to fail there could have been a larger company step in and buy Sirius or XM, which is what I think (in my non-professional business opinion) would have happened.
There is no doubt that profitability is possible now, but at what price to the consumers? Not just monetary, but the plans these carriers have presented will I believe be at the least slightly confusing to the average consumer, and could present a turn off. It will be interesting to see how XM and Sirius go about this, if they handle it wrong it could be a huge blow. by SISO
Get ready for a slow but steady introduction of commercials on the music channels now that one company has a stranglehold on sat radio. If you think it won't happen, you're living in a fantasy world. Mel Karmazin wanted more advertising on just Sirius alone (look at how bad the Howard channels are now, with a boatload of commercials) so now that they conned the DOJ into approving this, he will have free reign.
What an awful decision this will be. What are these lawmakers thinking? by jam master jay
How long before Stern gets another stock payout for "subscriber goals" ? by Minqua
If they do merge, the path to profitability is at least possible.
If you want satellite radio to continue beyond 2010, the merger is the only way. Without the merger, both Sirius and XM go broke and we all lose.
Get ready for a slow but steady introduction of commercials on the music channels now that one company has a stranglehold on sat radio. If you think it won't happen, you're living in a fantasy world. Mel Karmazin wanted more advertising on just Sirius alone (look at how bad the Howard channels are now, with a boatload of commercials) so now that they conned the DOJ into approving this, he will have free reign.
What an awful decision this will be. What are these lawmakers thinking?
How long before Stern gets another stock payout for "subscriber goals" ?
Wifi is limited to major cities, and is still shakey at best. iPod and other technology doesn't have any live content, so isn't applicable. HDRadio? don't they have commercials, censored music and no big names/sports?
There is NO competition here... by MixxMaster
I know change is coming, but I think the whole merger is the right thing for the health and survival of the industry. Money losing industries eventially make drastic changes to survive, and this is probably the best possible change of all the alternatives. by Manco
I can live with one of each platform's decade channels, but I really am looking for a way to get both platform's play-by-play programming on one subscription service. by speedy
1. Current receivers cannot receive the other's signal.
2. Current receivers cannot support a-la-carte
3. They will remove redundant channels.
So if I have 1 XM tuner and 1 Sirius tuner, I know the XM will only recieve XM choices, Sirius will only receive the Sirius. We can assume that, for example, the XM8 and Sirius 8 will be merged and duplicated on both services based upon #3. For an individual subscriber, there is no change to available content. You still get a channel 8. For a dual sub you had a choice of 2 80s channels (which do sound completely different) and have left a choice of 1. 1/2 of my choice has disappeared.
Should Mel come back and change his tune, then one can assume we would have 'more' choices with a dual mode radio. Until then .... dual subs have 1/2 the choice we have right now. by IdRatherBeSkiing
I can't believe they're letting this go through. The price for satellite radio will go up, the quality of the service will go down, and this is basically going to be the end of it right here. I never liked XM's selection of music and I can't bear to think I'm going to lose some of my stations for that crap.
I can't believe they're letting this go through. The price for satellite radio will go up, the quality of the service will go down, and this is basically going to be the end of it right here. I never liked XM's selection of music and I can't bear to think I'm going to lose some of my stations for that crap.
From a customer standpoint it's not as good, but from a business standpoint, one of the values of a merger is consolidating operations, which saves money. by metrofan
I think the opposite is true. The FCC chairman will use this merger as a way to try and force cable and sat TV to do a-la-carte type of offerings as they've tried to push in the past.
I think people are getting worked up a little prematurely. They have to maintain a viable product and most of the fears I've read so far wouldn't promote that.
Also, didn't Mel say something like he was leaving the programming decisions to the ones that make those decisions? by TheScionicMan
From a customer standpoint it's not as good, but from a business standpoint, one of the values of a merger is consolidating operations, which saves money.
I can't believe they're letting this go through. The price for satellite radio will go up, the quality of the service will go down, and this is basically going to be the end of it right here. I never liked XM's selection of music and I can't bear to think I'm going to lose some of my stations for that crap.
If you don't change anything, then nothing will change.
The end. by JoeTan
They have said that existing radios will continue to work. Existing radios will be able to receive select 'best of' of the other service (approx 10 channels) for a modest $4 extra / month. No mention of how they will fit those 10 into the bandwidth. NEW RADIOs will have the a-la-carte options NOT EXISTING RADIOS. If you have an existing Sirius radio, it will continue to receive Sirius content but NOT XM except the best of XM if you opt for the $4 more / month. by IdRatherBeSkiing
I've kind of leafed around siriusmerger.com and found their pricing model, but I'm not sure if that's out-of-date now or not. Can anyone more knowledgeable on this subject than I let me know how much I should expect to pay per month during baseball season for that additional programing package?
Thanks in advance. by TheMainMan
I think those that enjoy the non-duplicated niche channels on each service are probably the ones that should worry the least. Those who like rock, pop, and Alternative should worry the most. To me Alt Nation and Ethel are very different. But their genre on paper looks the same. by NHTracker
The only way they could make commercials on music channels fly is if they lowered people's monthly rates.
An area where I think the merged company could possibly see an increase in revenue is through getting more mainstream companies to advertise during the various sports & news talk channels. There's no reason they shouldn't have mainstream companies sponsoring mainstream sports broadcasts (NFL, MLB, NASCAR, College Sports, etc.) instead of the endless promos and radio-spam commercials we hear. Maybe the image of being a merged company well help along those lines. by ThunderRoad
plus the music catalog can be combind . by pbgr9
plus the music catalog can be combind .
if you listen to stern .he had the creator of sat radio on, and this person said we could have a better single ,if there was one company.right now the frequency they send out had to be split between the two companys witch cut the power of each sat in half. by pbgr9
While existing Sirius and XM radios will continue to work, there is no assurance that all the stations will remain on both services. In fact, to add the 11 channel "best of" service we will either lose channels or SQ will go down, it MUST be one of the two.
Additionally, even if you don't believe this to be the case merging of programming staff will almost certainly dramatically change the texture of some or many of the channels, this too, is a change.
If you don't change anything your service will change. by dantodd
if you listen to stern .he had the creator of sat radio on, and this person said we could have a better single ,if there was one company.right now the frequency they send out had to be split between the two companys witch cut the power of each sat in half.
if you listen to stern .he had the creator of sat radio on, and this person said we could have a better single ,if there was one company.right now the frequency they send out had to be split between the two companys witch cut the power of each sat in half.
Huh!?
plus the music catalog can be combind .
Nah . . . I'm pretty sure he's saying that a witch screwed up the tranny in his boat so now he gets no power to the stern and the sound quality of his room is cut down when he's trying to channel his combine.
Poor guy, those witches can be brutal.
If they combined the two, and made Squawctane, and this channel combined the playlists of Octane and Squizz, that playlist would be the sum of the parts, which is, at the very least, as deep as Squizz's, possibly deeper. And that is bad... why? by ClubSteeler
plus the music catalog can be combind .
if you listen to stern .he had the creator of sat radio on, and this person said we could have a better single ,if there was one company.right now the frequency they send out had to be split between the two companys witch cut the power of each sat in half.
2) Because then I'll not have the chance to listen to both channels when the mood hits. I will only have ONE option. by dantodd