Speculation of a Satellite Radio merger is nothing new, but an increasing number of pundits are weighing in with scenarios of how the possible transaction would play out, and whether it’ll benefit anyone (aside from Mel Karmazin). From yesterday’s New York Times:
Today, thanks in part to the outsize radio personality, the Stern Effect has increased Sirius?s base to about six million subscribers, up 80 percent from one year ago. XM has increased its numbers by more than 30 percent, ending 2006 with 7.7 to 7.9 million customers.
?Satellite radio is growing faster than any consumer product except for the iPod.?
?When you have two companies in the same industry, we have a similar cost structure. Clearly, a merger makes sense from an investor?s point of view to reduce costs, and to have a better return,? said David Frear, the chief financial officer for Sirius.
In addition to Howard Stern, Sirius features personalities like Deepak Chopra, Judith Regan, Richard Simmons and Martha Stewart. Sports programming includes N.B.A., N.F.L., and N.H.L. games; Nascar programming begins this year.
XM has shows with hosts including Bob Dylan, Ellen Degeneres, ?Good Morning America? personalities, and Oprah Winfrey. XM broadcasts every Major League Baseball game as well as P.G.A. golf.
Yet the vast majority of programming remains duplicative.
Really? We’ve dabbled in Sirius, but never wrapped our ears around XM’s programming. Lefsetz (shockingly) sees it differently:
A merger would be terrible. For you?ve got two completely different cultures and Mel Karmazin would be in control when the deal was done, and all Mel knows is advertising, and that?s the one ace in the hole satellite has, its LACK of advertising.
Sirius has got the image and the mo.
XM has the better service, both musically and technologically.
The way this fucked up world works expect the two companies to get together and for the resulting company to be like Sirius. And, to paraphrase John Lennon, then the dream would be over.
Two different cultures. Two different incompatible technologies. Does this sound like fertile ground for getting together? But don?t ever forget, Wall Street is in control here, and what the Street wants will happen.
But the most legally sound wish and prediction comes from the Chicago Sun-Times:
Who knows? Maybe regulatory agencies will block the merger — not because there’s anything illegal about it, but because it makes satellite listening less fun.
We don’t expect many of you to have experience with both services, so a compare-and-contrast is asking too much. But would a single, monolithic satellite entity be better for music than two competing services? The danger is that both continue in their financial struggles and disappear completely — but in an age of internet radio and near-limitless access to all the music, like, ever, the real value in FCC-free radio is the programming, the content selection, the trustworthy filter. Or maybe we’ve got it twisted, and the ultimate end of the medium is uncensored fart-jokes, fuck noises, and requests to see Pam Anderson’s “lady lips.”