DoJ Finally Realizes Sirius/XM Radio Merger Isn't a Threat 3 comments
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Finally, more than a year after the deal was first announced, the Department of Justice approved the merger
of Sirius Satellite Radio and XM Satellite Radio. This deal took longer
to review than Google’s DoubleClick acquisition. And it is not over
yet. The FCC still has to put its stamp of approval on the paperwork.
Washington really needs to speed up the merger-review process. Deal, or
no deal: it should take no more than six months tops for Washington
regulators to render their verdict on an acquisition.
If this merger does go through, as it should, what will the result be? A struggling company with a combined $2 billion in 2007 revenues, $1.25 billion in combined net losses, 17 million total subscribers, and more than 1,500 employees (there’s your costs savings right there). The logic of the deal has always been about reaching critical mass. Satellite-based businesses have huge sunk costs and they need to reach a massive number of paying customers in order to compete.
Will this be enough? Satellite radio is a superior product to terrestrial radio, but it still faces two main challenges: it is not free, and you really only need it in your car. With the increasing diversity of music choices on the Web (both legal and not) and the ubiquity of iPods, terrestrial radio is the least of Sirius/XM’s worries. Maybe Apple should just buy the combined entity and put it out of its misery. I’ve always thought that an iPod/XM radio would be a killer product.
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This article has 3 comments:
Tell all your friends to send a msg to FCCINFO@FCC.GOV
A nice mwould be "If you are sick at home for 2 months now, send in the dog to make a decision!!"
I'll take 2 tumms now and call you in the morning.
Dauntless
On Apr 16 10:04 PM DoctorBob wrote:
> Besides the car, the other location that satellite radio really comes
> in handy is anytime you're outside a major city. The ability to have
> your favorite genre of music, talk, or sports instantly available
> when you're "in the woods" goes a long way in making that 13 bucks
> seem like a no-brainer.