XM/Sirius Merger: Shotgun Wedding?

For users, once the dust settles over the long-term, the merger of XM (XMSR)/Sirius (SIRI) should be great news.

For shareholders, however, the consideration should be whether this is really a move out of desperation. Satellite radio isn't going away, but the economics have proven difficult -- and I'm not talking about the $1.6 billion in net debt for the two. While one is clearly better than two, does it make sense to have Oprah [XM] and Howard Stern [Sirius] on the same team?! A key comment in the press release about competition shouldn't be lost on investors:

In addition to existing competition from free 'over-the-air' AM and FM radio as well as iPods and mobile phone streaming, satellite radio will face new challenges from the rapid growth of HD Radio, Internet radio and next generation wireless technologies.

All of that is obvious, but it's intriguing that it's in the press release as an argument in favor of the deal.

Something else that would seem obvious: How will they merge the satellite technologies, which are different? And once the dust settles, what will happen to existing satellite radios? Will they all need technological updates?

See: Sirius and XM Satellite to Merge - If They Can Clear Regulatory Hurdles