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XM and Sirius: Marrying the Only Available Partner

From the start, this was the merger everyone knew would happen someday. Perhaps it would come about as a result of technical necessity: If XM or Sirius satellite radio lost one or more of their incredibly expensive birds, surely the competing behemoths would go to federal regulators and ask for permission to marry. Or perhaps it would be a matter of economic distress: If Americans' fascination with the new programming and gadgetry of satellite radio went sour, the two big boys would find salvation in becoming one.

As it turned out today, it was a mix of forces that have compelled Washington-based XM and New York-based Sirius to propose a multi-billion dollar merger that promises to turn satellite radio into a more expensive commodity providing fewer choices in programming, all while giving the technology the time, funding and stability it needs to survive and thrive in a rapidly changing media world.

Sirius's Mel Karmazin was the public face and driving personality behind the merger talks, which started around the time it became clear that Sirius's late start in the satellite competition had left it at a big disadvantage to XM. But Sirius was not negotiating entirely from weakness; thanks to its enormous investment in Howard Stern and other big-name celebrities, and its high-quality programming, Sirius became the faster-growing of the two satellite choices in the past couple of years. And while XM was moving faster to gain some control over the wild spending that both companies engaged in to capture Americans' attention in this insanely-splintered catalogue of media choices that we all live in, the bottom line was that neither company was giving their big investors the return that they had once predicted.

And now that we are hurtling toward the day when some form of wireless internet will be available to drivers on a consistent enough basis to allow for cars to be equipped with web radio receivers, it's not entirely clear that satellite will be more than an interim technology. That interim could last a decade or two or even longer, but satellite's heyday could also turn out to be shorter, which makes it all the more imperative for XM and Sirius to turn themselves around soon, and to use their combined creative powers to establish themselves as reliable and alluring content providers across a whole slew of platforms.

That's why you're starting to hear XM and Sirius audio programming popping up not only at Starbucks and in restaurants and retail establishments, but on airplanes, on traditional broadcast radio and increasingly online too.

This merger is anything but a sure shot. The federal government's original deal granting licenses to XM and Sirius required the two companies to work together toward making their technologies compatible with one another, but expressly ruled out the idea of the two merging at any time. To overcome that original condition, XM and Sirius will now have to prove that they cannot make it on their own, which may be tough to do considering that satellite radio turned out to be the fastest-growing and most readily accepted new entertainment technology since the DVD.

Still, that success came at enormous expense, and both companies can show oceans of red ink on behalf of their hardship case. More impressive, satellite--despite its creative achievements, reviving the art of radio in so many musical genres that broadcast radio had long since given up on--probably cannot prevail against the competition of the iPod, digital downloading, and the ability of everyday listeners to create their own radio stations. Satellite, like the rest of radio, must instead carve out a niche as a supplement to the iPod, as a way to discover and learn about new music and a place to get programming that's not available anywhere else (out of town baseball games, out of town traffic and weather, full-length concerts, visits with recording artists, celebrity deejays, etc.)

The unresolved questions following hard on today's merger announcement include some very important ones for Washington:

-- Would the new company be headquartered here? XM's building at Florida and New York avenues NW is the heart of the emerging NoMa office and retail development sector. Certainly it would be more economical to use the DC headquarters rather than the midtown Manhattan home of Sirius. But for creative purposes, Sirius will likely argue that the talent is based in New York and the deejays and musical artists ought to be there. Yet XM has shown that it's easy in this digital age to put the physical headquarters anywhere and still be creatively vital.

--What would the surviving company's name be? XM is one of the best new brand names to come along in many years. The new management, even if it is dominated by Sirius folks under Karmazin, would be fools to discard such a stroke of genius.

--What would happen to the hundreds of deejays, talk hosts and other talent put together by XM and Sirius? The satellite companies, which became an employment service for three generations of radio talent that had been left to wander in the wilderness during broadcast radio's decade of cost cutting, would obviously cut back like crazy. The result would be that the best of the best would be retained, but hundreds of strong players in the radio biz would be cut loose.

What's next? Months and months of lobbying. Lots of money pouring into the coffers of lawyers and PR people. And probably a quick end to the bidding war for talent on both XM and Sirius.

As always, Howard Stern wins big--he got the big money before the big money went to the suits. More later.

By Marc Fisher |  February 19, 2007; 5:20 PM ET
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Comments

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I am heartbroken over news of this merger. With the exception of Sirius' lock on the NFL, XM had an amazing programming lineup. Its music channels exposed me to a universe of new music and artists, and helped sell a few CDs of music I discovered. Plus, I will never forget hooking up my XM unit, listening to the preview channel and hearing the voice of Bobby Bennett, the 1960s DJ for WOL radio who I gew up listening to in the 1960s. Hearing him spinning tunes as he did when I was growing up in Northeast made my day.
I loved the fact that XM was a successful home-grown product that proved, as you wrote, that D.C. can be an entertainment and communications center in its own right. I know that XM and Sirius have a lot of channels that either duplicate or mirror each other, but XM has some assets -- a jazz fusion channel, a channel dedicated to house music and one that plays a mellow and sometimes esoteric blend of electronic "chill" music -- that make it special and well worth $13 a month (less than the cost of most CDs). In recent years we've seen a lot of mergers in which consumers came out the poorer. We can only hope against hope that this one is an exception.

Posted by: I.J. Poole | February 19, 2007 6:04 PM

I thought that competition was good and monopolies were bad, but then Marc Fisher came along and explaiedn how competition forces companies to compete (ack!) and lower their margins (no!).

Thanks for enlightening me.

Posted by: I never thought about that way... | February 19, 2007 6:26 PM


I think the public is going to be fooled on the benefits of this merger.

Sirius and specifically Karmizan never really acted fiscally responsible, he spent and spent and never really gained in efficiency. Some mistakenly think Sirius growth was proof of his skills as a manager, however the only reason they were achieving growth rates that they did was because they were starting from a smaller base, spending sky high to aquire subs and the churn monster hadn't caught up with them yet. If you'd given Sirius another 6-12 months their churn rate would devour their net adds simply because churn of 4% is constant for both companies and with Sirius' large base, the churn monster would gobble them up just as it did XM.

Be very careful investing with Karmizan. He is unproven as a leader in Sat radio. He has only shown a talent for showmanship and spending money, not making money!

Posted by: XM lover | February 19, 2007 8:04 PM

Sorry, but the new headquarters are going to be in New York. It's a no-brainer. Maybe some of the channels not as dependent on being hip or current could be based in DC, but you're not going to get people to go out of their way to go to a DC studio for an interview or session.

Face it -- DC is just too "out of the way" for talent to come down to for an appearance on a struggling medium. If the choice is between New York City or New York Avenue, the latter would require a full day of travel, putting them out of commission to do anything else. There's nothing else for a performer in DC besides local stations, so why should they go out of their way?

No, New York is the only way to go for a new satellite HQ. But hey -- satellite still needs an original news operation. Maybe that important service could be based in DC...

Posted by: MB | February 19, 2007 8:25 PM

How anybody can think such a merger would benefit listeners of either XM or Sirius is beyond me. More variety? Please. Look what happened after 1996 when the government allowed terrestrial radio stations to own virtually unlimited shares of a given market -- slashed playlists, robo-DJs and 25 minutes of commercials an hour. It's very clear: competition is good for consumers, monopolies are bad.

As an XM subscriber since 2002, I pray the regulators block this farce.

Posted by: Markydeee | February 20, 2007 12:08 AM

How anybody can think such a merger would benefit listeners of either XM or Sirius is beyond me. More variety? Please. Look what happened after 1996 when the government allowed terrestrial radio stations to own virtually unlimited shares of a given market -- slashed playlists, robo-DJs and 25 minutes of commercials an hour. It's very clear: competition is good for consumers, monopolies are bad.

As an XM subscriber since 2002, I pray the regulators block this farce.

Posted by: Markydeee | February 20, 2007 12:09 AM

I think this merger is great news. Both services -- XM and Sirius -- have yet to make a profit, and it just doesn't make sense for them to compete against each other with such similar programming.

It's a new and unproven technology, and if, through this merger, they can show it can work and turn a profit, then you can bet that other companies will start sending up birds of their own.

I'd rather have a sure-footed monopoly for the present than two shaky competitors. I'm more interested in the success of the medium than of either of the two companies, and I think the merger is the best way to ensure that success.

Posted by: dablaze | February 20, 2007 12:48 AM

And prices will raise without any competition. $77 a year for Xm was tolerable. I refuse to pay anymore than that. $13 a month no way especially to support that punk Howard Stern who hasnt had any new material or an original idea since he left DC 101.1 in late 70's. Hope they keep Soul Street and its DJs since it the best along with Wynton Marsalias on the jazz channel. Radio Margaritaville will ne a nice addition. But what are the chances of this merger really happening?

Posted by: Vaherder | February 20, 2007 6:29 AM

I didn't hear, did montgomery county schools open on time today? All that melting ice is definitely a hazard that the children must be protected from! :)

Posted by: Anonymous | February 20, 2007 9:51 AM

Its nice to see the Post confirm what I had begun to suspect: that iPods and similar will be the death of satellite, not to mention FM and AM.

Posted by: ahp | February 20, 2007 10:37 AM

HOWARD SERN RULEZZZZZZZZZZZZZZZZZZZZZZ

Posted by: 5555 | February 20, 2007 10:54 AM

HOWARD STERN RULEZZZZZZZZZZZZZZZZZZZZZZ

Posted by: 5555 | February 20, 2007 10:54 AM

I pay my XM monthly for 4 channels. Thats it. If they drop 3 of them ok. I would still pay the rate for the 40's channel alone. That 1 channel is why I chose XM over sirius. I'd pay twice my current rate for that channel alone. And yes, I can play my MP3's. But the variety, the new (to me) artists I discover - those are priceless. I can't tell you how poor management in both services had to be to even consider paying the fee's they did for Oprah, Sterns, and Martha Stewart, etc... Some of us just want music, and the variety that satellite offers. Oh well.....

Posted by: Andy | February 20, 2007 10:56 AM

Merger, purger, who cares, the bottom line, what is it going to coast the subscriber?????

Posted by: Phil | February 20, 2007 10:56 AM

HOWARD STERN RULEZZZZZZZZZZZZZZZZZZZZZZ

Posted by: 5555 | February 20, 2007 10:56 AM

I have been a Sirius subscriber for over two years now, and love it. I don't listen to many different channels--mostly the Blues channel (at least an hour a day), Raw Dog comedy, English Premier League football (soccer), some NASCAR, some NFL if the Eagles aren't on local TV, and bits and pieces of other channels. I would pay the money just for the Blues channel alone.

Any sane person knew this merger was eventually coming, but I thought it would be later than sooner.

Posted by: Tim | February 20, 2007 11:03 AM

Any time ownership in any industry is concentrated to the degree that it will be in the event this merger is approved, consumers lose. We've seen it time and again in the telecommunications industry, and we'll see it again here as this nascent medium struggles to find its place in the evolving world of entertainment media.

This is a short-term play designed to give these two dominant - nay, only - players some breathing room while they figure out how they're going to survive. Their revenue hasn't ramped as fast as they'd like because people, as evidenced by some of the earlier comments in this thread, just aren't willing to pay yet again for something they've essentially gotten for free all along.

Sat radio's value proposition has long been high programming quality, no commercials, lots of choice. But after listening to it for a while, it dawns on you that it's the same music that you can hear on terrestrial stations. As it fades into the background, you begin to wonder why you're paying for the privilege.

Today's generation buys iPods. They program their own music. They're suffering from subscriber fatigue as service providers increasingly, and sometimes wrongly, assume that they'll say yes to yet another monthly bill.

Subscriber-based streaming media is a solution to yesterday's problem that no one ever really asked to be solved. This story isn't over yet, and it'll get uglier for both players before it gets better. If it ever gets better.

Carmi
http://writteninc.blogspot.com/

Posted by: Carmi | February 20, 2007 11:04 AM

I think this is great news. If the companies take the best content from each service it will incredible. Already satellite radio blows away regular radio.

Now we will have even more choices in music. Sports fans will have MLB, NFL and NASCAR. Fans of incensored comedy will have Howard Stern and O&A and more. For the person above who says Howard Stern hasn't had an original idea in years, you're out of your mind and obviously don't listen to him on a regular basis. I've been a fan since he was in DC in the early 80's and his show now is by far the best ever.

I also don't believe that the Ipod will be the end of satellite radio. Your Ipod only has content that you have already downloaded and listened to. Satellite radio allows me to hear tons of new content everyday. I enjoy it in addition to my Ipod. Both are part of my daily life.

Finally for the person who says Mel Karmazin has no past successful track record in making money, You're way off track! Karmazin is a legend in the entertainment industry who led Infinity Broadcasting to incredible growth and finally a merger with CBS. All Stern fans will eternally be grateful to Karmizan. When the idiots at NBC radio fired Howard Stern, it was Karmazin who hired him for the afternoon drive slot on his NY station. What followed in the years after is the biggest success story in the history of radio with never before seen ratings and coast to coast domination of major markets thanks to syndication. Karmazin knows what he's doing and if the bozos at the FCC will get out the way it's going to be happy days for all satellite radio lovers.

Posted by: Photomaniac | February 20, 2007 11:07 AM

I have been a Sirius subscriber for over two years now, and love it. We live way down in St. Mary's County, MD, where the radio is pretty dismal with few choices, so satellite radio is a Godsend. I don't listen to many different channels--mostly the Blues channel (at least an hour a day), Raw Dog comedy, English Premier League football (soccer), some NASCAR, some NFL if the Eagles aren't on local TV, and bits and pieces of other channels. I would pay the money just for the Blues channel alone.

My wife loves listening to the Blues channel at her office over the Internet.

Any sane person knew this merger was eventually coming, but I thought it would be later than sooner.

Posted by: Tim | February 20, 2007 11:08 AM

We all know this was inevitable, Sirius just jumped the gun to aquire XM. Its a bit premature, but Sirius was on its way to surpassing XM in subcribers. However, had XM aquired Howard Stern we would be reading how XM is buying out Sirius.

Posted by: Hacho | February 20, 2007 11:10 AM

I have XM and listen to two or three music channels and then the news. If I lose any one of the music channels or the news I leave. The big name celebrities are a waste of money to me. Less talk more music is my interest. Oh, Old Time Radio is pretty interesting as well.

Posted by: Jerry | February 20, 2007 11:16 AM

Just so my Playboy channel don't go away, I enjoy doing the morning drive and shifting my stick shift! lol

Someone make a darn device already that does it all, internet music, 10meg pixel camera, plays dvds, cd's, vhs, beta, 45/33 lps, cassette, dat, sd, mini sd, usb port firewire, cell, CB band, SSB, 40 meteres, HDTV I would pay $9.95 a month for that.

Posted by: Wayne G. | February 20, 2007 11:18 AM

Just so my Playboy channel don't go away, I enjoy doing the morning drive and shifting my stick shift! lol

Someone make a darn device already that does it all, internet music, 10meg pixel camera, plays dvds, cd's, vhs, beta, 45/33 lps, cassette, dat, sd, mini sd, usb port firewire, cell, CB band, SSB, 40 meteres, HDTV I would pay $9.95 a month for that.

Posted by: Wayne G. | February 20, 2007 11:19 AM

I am a 3 year subscriber to both services
and relish the idea of a merged company which would give me the opportunity to pick
my music and entertainment channels on an
ala carte basis.

I firmly believe that the FCC and DOJ should approve this merger in the interest of consumers and investors. The Sirius/XM proposed merger is not at all similar to the dish/direct tv attempted merger. The consumer currently has a vast number of choices for audio entertainment from Terrestial free radio, Ipods, MP3 players,
internet radio, and HD radio. The true competition for satellite radio is not each
other but all those other choices.

If the Satellite Radio companies are not allowed to merge they will both probably flounder and go bankrupt denying consumers
the fabulous content they both provide

I pray this merger is approved.

Posted by: Wayne | February 20, 2007 11:22 AM

and what about those of us who pre-paid for our XM service? When we did so in December, there was no hint of such merger.

Posted by: customer | February 20, 2007 11:28 AM

Carmi- I find it hard to believe that you've ever heard satellite radio! How can you possibly say that it's the same stuff as on regular radio? First of all regular radio has tons of commercials. Sirius Satellite radio has no commercials on it's music channels. Even in a major city like Washington DC it's just about impossible to turn on the radio and hear jazz, blues, and bluegrass. That's all on 24 hrs a day on satellite. The satellite rock channels play deep cuts that I never hear on regular radio. Sirius also has a channel for The Who that plays not only almost their entire catalogue but also live concerts from both the past and the current tour. Soon they will add a Sinatra channel as well. Choices, lot's of choices!

Then you have uncensored comedy. This is totally unavailable on regular radio. Again this is available on several Sirius channels 24 hrs a day!

For sports fans and NFL fans in particular you have multiple games to listen to. For NASCAR fans they will be providing not only coverage of the race but also separate channels for the top ten drivers so you can hear the drivers talking to their pit crew! I would think NASCAR fans would go nuts for this. Again this can't be found on regular radio.

How about traffic coverage nationwide? I'm planning a road trip to NYC next month. With Sirius Satellite Radio I can instantly check the traffic for DC, Baltimore, Philadelphia, and NYC and alter my route if needed. Can't do that with regular radio.

Get the idea Carmi? There is no comparison between regular radio and Satellite radio. It's very obvious that Satellite is by far the better product. If you had ever really listened to satellite you would know this already! It's certainly well worth a measly $13 a month unless you're a loser who can't afford it. But then you're probably at home adjusting the rabbit ears antennae on your B&W TV!

Posted by: Photomaniac | February 20, 2007 11:38 AM

I hope this merger doesn't go through. The Loft on XM is one of the best stations ever. They even program the songs in an order that makes musical sense. No one spends that kind of time putting a playlist together. I agree with one of the posters above--the ipod is for listening to songs you know, but how do you find out about new songs? Why, as our choices seem to become greater, are they so limited?

Posted by: Loft Lover | February 20, 2007 11:58 AM

Carmi is Canadian. Nuff said!

Posted by: He's Canadian | February 20, 2007 11:59 AM

It is possible that the merger could be a good thing. I have been a Sirius subscriber for near two years and I would be willing to pay my $13 a month just for four or five channels that I listen to. I listen to mainly the rock channels, and XM does not nearly have as good a lineup for the newer rock that is out there. Sirius by far kills XM as for the channel lineup goes, and I feel it would be a shame to see Sirius change their great lineup of channels just because of the merger. So, you could argue both ways about the merger I just hope they use their heads when finalizing the deal, if it makes it that far? Octane 20 and Kayla rules!!!!!!!!!!

Posted by: Charlotte NC | February 20, 2007 12:11 PM

Wow, Photomaniac, I admire your precise assessment of my background. You clearly are a wizard of media. We all bow in your general direction.

For the record, I'm a senior analyst for a major tech research firm. I'm a broadcast journalist who has produced radio for radio stations somewhat larger and more full-featured than the drivel you seem to content yourself with. Go ahead, Google me. You know you want to.

If satellite radio were as fantastic as you say it is, we'd all have converted by now. But we haven't. The service has stumbled in Canada for precisely the same reason: it isn't so much better than what's already available to justify the subscription cost. They could charge $3.95/month and it would be the same issue.

In this day and age, people download music and load it onto their media players. They like programming their own, and would rather not rely on the programming "choices" of some unseen, untrained musical moron in some faraway, disconnected office.

Enjoy your NASCAR, your traffic and your geriatric rock bands (you have such sophisticated taste in programming, I must say.) I'll be streaming it via a no-cost Internet pipe long after XM-Sirius has given up the ghost.

Carmi
http://writteninc.blogspot.com/

Posted by: Carmi | February 20, 2007 12:12 PM

It is possible that the merger could be a good thing. I have been a Sirius subscriber for near two years and I would be willing to pay my $13 a month just for four or five channels that I listen to. I listen to mainly the rock channels, and XM does not nearly have as good a lineup for the newer rock that is out there. Sirius by far kills XM as for the channel lineup goes, and I feel it would be a shame to see Sirius change their great lineup of channels just because of the merger. So, you could argue both ways about the merger I just hope they use their heads when finalizing the deal, if it makes it that far? Octane 20 and Kayla rules!!!!!!!!!!

Posted by: Charlotte NC | February 20, 2007 12:12 PM

It is possible that the merger could be a good thing. I have been a Sirius subscriber for near two years and I would be willing to pay my $13 a month just for four or five channels that I listen to. I listen to mainly the rock channels, and XM does not nearly have as good a lineup for the newer rock that is out there. Sirius by far kills XM as for the channel lineup goes, and I feel it would be a shame to see Sirius change their great lineup of channels just because of the merger. So, you could argue both ways about the merger I just hope they use their heads when finalizing the deal, if it makes it that far? Octane 20 and Kayla rules!!!!!!!!!!

Posted by: Charlotte NC | February 20, 2007 12:13 PM

Carmi must be employed by the NAB...there is no possible way he has listened to XM or Sirius. Plain and simple either service blows terrestrial radio clear out of the water. Carmi, try listening to one of these services for a trial it's obvious you have never listened! Once I tried XM I could not live without it, XM (or Sirius) is great!

Posted by: tonester | February 20, 2007 12:17 PM

we got a Sirius unit in Nov and are pretty unimpressed. We will only pay for service while doing long distance drives. As far as the traffic channels - what a joke. At least half the time, something else is on those channels (football game, etc.). We were thinking of buying an XM unit as well - seeing that service actually has what we were after (Sirius advertised Big10 coverage on the box and the truth of it is that it is one team only). So. A merger would be fine, all I really care about are the sports, anyway.

Posted by: star11 | February 20, 2007 12:22 PM

I've subscribed to both services since the beginning. GPS receivers for my plane and my sailboat bring complete forecasting and enroute weather reporting to my fingertips from XM Weather and music too. I also have Sirius receivers to listen to different music programming, like Radio Margaritaville, when I'm on the boat.

A merger was inevitable, neither company could survive much longer spending that kind of scratch. The writing was on the wall when Karmazin gave Sirius to Howard Stern, who turned around and sold $500M worth of his stock the first week on the job.

The only other option would be if the FCC blocked it, the last company standing would have total control but be in bad financial shape.

Either way, bad for consumers.

Posted by: The King | February 20, 2007 12:25 PM

Unbelievable amout of misleading info on here!

Carmi- Your lack of an intelligent argument is hilarious. Why not just fess up that you're clueless on this subject. I think I pretty clearly stated all the amazing options for every style of music new or old that can't be heard on regular radio. Your original post statement that there is no difference between the music on regular radio and satellite is so far from the truth that you should be embarrased. If you don't want to pay the monthly fee that's fine, but to stick by your current argument is laughable. It's a shame we can't sit side by side with a regular and satellite radio in front of us.In just a few minutes I could show you how truly foolish and uninformed your comments are. You don't work for the NAB do you?

Star11- What are you talking about? Sirius has designated channels for traffic that have nothing to do with football games. I have it as a preset and it works fine on a daily basis.Perhaps you were "confused"! Try reading the owners manual or maybe just pay attention! My kids can do it so I'm fairly sure you can handle it as well.

Posted by: Anonymous | February 20, 2007 1:39 PM

I just never was convinced about satelite radio. Yeah, you get more choices - but it's still radio. You still can't choose what you want, when you want. I just don't see the point in paying to "hopefully" hear something that intrigues me.

Posted by: John W. | February 20, 2007 1:52 PM

As someone who subscribed to Sirius well before Howard came along and also spent a lot of time listening to XM and Sirius on friends radios prior and after purchasing, I strongly believe Sirius to be the better content provider. I get stuck listening to XM on airplane flights and find it hard to enjoy after being exposed to the variety and higher quality Sirius offers.
Should they merge, XM will bring a lot to Sirius, but not as much as Sirius bring to radio.

Posted by: Steve | February 20, 2007 2:50 PM

John W- With satellite radio providing over a hundred music channels, if you can't find something you like then you really are a finicky listener! And if you can't find it on satellite radio then you must really hate regular radio! I have no problem being entertained by satellite radio and no longer do I dread a long road trip or traffic jam. I just smile and groove along with my Sirius Satellite Radio. The only thing I dread is being stuck in a car without satellite radio. Now that's a nightmare!

Posted by: Anonymous | February 20, 2007 3:40 PM

Ok folks... I couldn't resist after seeing the last attack on Carmi. From a pure music consumer perspective, sat radio does offer a consistent flow of uninterrupted music. However, the business model sucks. It offers very little incentive for content providers and is completely dependent on subscribers for revenue. So much for cross-sell and up-sell opportunities.

Obviously there is a small percentage of the global population that find sat radio useful but the numbers do not lie. A handful of people can't pay for the operating costs and its just a matter of time before the business model changes. Perhaps advertising might be the only plug to stop this titanic from sinking.

Either way, the consumers will suffer.

Posted by: Music Lover | February 20, 2007 3:55 PM

Ok folks... I couldn't resist after seeing the last attack on Carmi. From a pure music consumer perspective, sat radio does offer a consistent flow of uninterrupted music. However, the business model sucks. It offers very little incentive for content providers and is completely dependent on subscribers for revenue. So much for cross-sell and up-sell opportunities.

Obviously there is a small percentage of the global population that find sat radio useful but the numbers do not lie. A handful of people can't pay for the operating costs and its just a matter of time before the business model changes. Perhaps advertising might be the only plug to stop this titanic from sinking.

Either way, the consumers will suffer.

Posted by: MusicMan | February 20, 2007 3:56 PM

Ok folks... I couldn't resist after seeing the last attack on Carmi. From a pure music consumer perspective, sat radio does offer a consistent flow of uninterrupted music. However, the business model sucks. It offers very little incentive for content providers and is completely dependent on subscribers for revenue. So much for cross-sell and up-sell opportunities.

Obviously there is a small percentage of the global population that find sat radio useful but the numbers do not lie. A handful of people can't pay for the operating costs and its just a matter of time before the business model changes. Perhaps advertising might be the only plug to stop this titanic from sinking.

Either way, the consumers will suffer.

Posted by: MusicMan | February 20, 2007 3:57 PM

I was given a Sirius receiver as a gift. Paid for the service for a year and figured when the next year came around they'd send me a bill. INSTEAD they charged me for another year without even asking me if I wanted to continue the service. I think XM has better music when it comes to the R&B Channels. I'm a little sore with Eminem and his Shade 45. Anything beats being stuck listening to to the drivel on the local R&B stations (with the exception of Donnie Simpson in the morning).

This whole merger thing should prove to be very interesting. I have to agree with MusicMan - at the end of the day, it's the subscribers who are going to suffer.

Posted by: MizTeeJay | February 20, 2007 5:18 PM

I personally enjoy the uincensored comedy channel on XM, it's why I signed up. No public airwaves station could carry that station or Stern. I hope the deal is disallowed.

Posted by: RL | February 20, 2007 6:07 PM

Music Man- Your point has nothing to do with Carmi's comments. Carmi tried to claim that satellite radio would fail because it's basically the same songs as on regular radio. Anybody who has spent anytime at all listening to satellite radio knows that's a ridiculous statement.

There are many factors of satellite radio that can be debated, but the quality of the content as compared to regular radio is certainly not one of them. It's very clear that satellite radio offers by far the better product. It's up to the consumer to decide if it's worth $13 a month to them.

Posted by: Photomaniac | February 20, 2007 8:06 PM

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