Sirius and XMSR's Six Year Prison Sentence

We have a potential deciding vote on the marriage of Sirius (SIRI) and XM (XMSR). Adelstein says he would vote in favor of the deal as long as the company would agree to a six-year cap on subscription rates as well as relinquish 25 percent of all channels to public or minority-focused stations.

While they are at it, how about a ruling that 99% of all profits they do manage to squeak out be used for confetti during high school football games in climates under 72 degrees on the last Friday of each month while hopping on one foot singing Ring Around the Rosie?

Essentially what this means is that Sirius cannot increase revenue the old fashioned way and will have to be a volume dealer to make up for six years of rising costs of labor, technology, and content, not to mention the lackluster sales hurdle it will be facing from new automobile revenue.

Unfortunately the poor folks at Sirius may take the offer just to be done with this circus. For all I know they may have already agreed on it by the time this article is published.

Six years is an entirely unreasonable, insulting request and I truly hope that commissioner Adelstein is proud of the "For Sale" sign on his forehead.

Comments

[Sirius Fan]

The only disagreement I have with this article involves the placement and wording of Adelstein's sign.

[ARI D K]

Adelstein what a hypocrite ! Is this what they tought you in scoool ?
How do these commis get the Job? I guess an inside job. Maybe he can get a 6 year pay freeze. Hmmm ?

[ITS A SIRIUS XM WORLD]

I think it should be mandated that all traditional radios should be able to receive the new merged satellite radio companies signals and that traditional radio should pay for this new mandate!! While were at it...how about lowering and freezing oil and gas prices for six years!!!

[ruthoer]

Obvious this Commissioner too closely tied to celestrial radio. The condition as to 6 years outrageous. Can they increase prices due to inflation. People like this do not belong in public ;life, He is obviously in someone's pocket.

[4play2]

Let me ask this. Does Ms. Tate see what is going on here. Her delay is allowing Adelstein to attempt this backdoor tactic. His motives are obvious and borderline criminal. If Ms. Tate offers her vote as soon as possible, Mr. Adelstein can be and will be completely ignored. Unfortunatley he will still get his reward from the lobbist(s) since he has already did their bidding, regardless of the outcome.

[the little guy]

Does anyone know how much it would cost to post his demands on the front page of the investors daily, the wall-street journal and post hand bills in his neighborhood..

[Jim42wmass]

What a joke! This is one of the most competetive businesses out there. THeir major competitors are a free service! While as a satellite susbcriber , these conditions will benefit me (other than the ridiculous minority set-asides), they are anti-business and anti-free market. The reason I went to satellite immediately when it became avalaible in my area is that terr. radio sucks so bad, and continues to. A great alternative that I'm wiling to pay for - what could be more American than that. The gov will kill this business in the end and we'll be stuck with "Dingo and the baby" programming.

[Oscar BullFrog]

with extreme difficulty i could see a 2 year (gag! barf!) hold on subscription prices as the fcc tries to drive a demand economy into a command economy. i can approve the need to have a single radio that receives both channels though. that only makes sense since the cos would also be single then. as far as 'reserved bandwidth' for air america or other unprofitable or undesirable broadcasts 10% is the max vigorish that would be tolerable, as untolerable as vigorish is. making sausage and laws seems *so* sanitary compared to the fcc's torture - oh, wait, america doesn't torture; nevermind.

[MiMi]

I see your upset about the possible restraints as a precondition to the merger. Let me see if I too can play Ring Around the Rosie with some last Friday of the month thoughts of my own. These companies are about to be granted a monopoly, a monopoly, as in no-competition-I- can-do-what-ever-I-ple... monopoly. That's right, just me, without any fear of a competitor undercutting me in quality, cost or selection. I don't know, I'd love to be the only beer vendor at the football game, or the only newspaper in the country. Unrestrained, of course, by any conditions of how I conduct my business. Oh, I promise I will print nothing but the truth and never raise the prices of my brew unless..well, unless I want to. I will be the most benevolent of monopolies--you can be sure. My only care will be how well I serve my clientèle. Just like public schools and the post office.

[omagod500]

get the merger approved and then seek judicial relief from the conditions imposed....

[Edster]

Gino you are right. The whole merger matter is a circus. Both Sirius and XM have been held hostage too long. No doubt an abusive comment from a frusted minor stock holder.

[it ain't right]

Where were these requirments when negotiations were being done? The team is on the one yard line and all of a sudden an extra 30 yards has been added to the field. Does Adelstein expect Sirus to expand services and develope new technology with their hands tied behind their backs for 6 years. It's time for much of government to take a look at what they are doing to free enterprise. Maybe Sirus and XM should just work together behind closed doors and offer a combined radio service that could be profitable and let the crooked politicians find another cow to milk.

[Gregg]

Here's Adelstein's strategy -
> Merger about to be approved so he's looking to his career. By putting out the 6yr/25% spectrum offer, he looks like he's willing to compromise and takes care of the NAB and democrats like Markey, who literally sent the exact same thing just this week.

Tate is going to go with something much more reasonable and this thing will be done by the end of the month - finally. Then, Adelstein gets something for himself out of it. Plain and simple.

Very very sad how this thing has gone.

I've scrolled thru dozens and dozens of comments on the FCC website from everyday people all over the country and it's very clear that only the NAB/Georgetown Partners/Clear Channel/Ibiquity are against this merger.

We can cancel anytime and any day we want!!! Why do I need 'protection'??

[it ain't right]

OK, Sirus bows to the FCC and gets the merger done. Then they can screw around for a couple years attemppting to comply to the FCC's demands and keep telling them that the solution is just around the corner, maybe the end of this month or next month at the latest. If the FCC has a problem with that.......well they set the guidlines for prcrastination.

[RReagan]

Michael L. - You need to get into today's world! Drink soda (for which there is a monopoly at games by the way between either coke or pepsi - there goes your theory) and read off the Internet or watch TV instead of reading the only paper in town. You also fail to understand the enormous complexities and costs associated with Sat Radio and that these 2 companies might not exist without a merger. How then will that be good for consumers who love the product? Who will then compete with AM/FM and the Ipod? Competition is good, right? We have already been way past the point of XM and Sirius competing with each other, the Dept of Justice took care of that. You must not be following what is going on in today's world.

[gekko13]

One needs to look no further than the pending merger between XM and Sirius Satellite to see cronyism, corruption, and bureaucratic ignorance at its best. And the guilty party is the FCC and congress, who are being paid off by lobbyists who are against the merger. This, after the Department of Justice ruled back in March that the merger was not monopolistic and would benefit consumers. This after the DOJ gave the green light WITHOUT the companies having to give concessions. The proposed merger is a mouse compared to other mergers in history, with the combined market cap of the companies hovering near 5.6 billion dollars. Yet it is the longest running merger proposal in history, surpassing 400 days! Meanwhile, Exxon and Mobil, two oil behemoths were allowed to merge relatively smoothly, considering the monopolistic concerns involved in that one. (How do you like gas prices today?) And now Anheiser Busch is going to be gobbled up by a foreign entity in three shakes of a lamb's tail. The actions, or rather, INACTIONS by the FCC concerning XM/Sirius wreak of BLATANT POLITICAL CORRUPTION. And people wonder why our country is so screwed up?

[Oscar BullFrog]

michael l (Jul 18 11:17 AM) : monopoly? only in outer space and only until it becomes profitable to launch more saddle-lights. (it's a horse race ...) there are SOOOO many other stations/private schools and SOOOO many other stations/delivery companies that receiving entertainment/educatio... is *totally* competitive. no myopia in my eyes/ears; but yours?

[Oscar BullFrog]

michael l (Jul 18 11:17 AM) : monopoly? only in outer space and only until it becomes profitable to launch more saddle-lights. (it's a horse race ...) there are SOOOO many other stations/private schools and SOOOO many other stations/delivery companies that receiving entertainment/ education/ packages is *totally* competitive. no myopia in my eyes/ears; but yours? (earlier post got chewed methinkx - sorry)

[oregonduck]

New News:

FCC Commissioner Calls For Negotiations On XM, Sirius Deal

Jul 18, 2008 12:05:04 (ET)



WASHINGTON (Dow Jones)--A Federal Communications Commission commissioner who could be the deciding vote on a pending merger between XM Satellite Radio Holdings Inc. (XMSR) and Sirius Satellite Radio Inc. (SIRI) wants to negotiate with the companies on additional concessions and enforcement mechanisms, according to an FCC person familiar with the offer.

Commissioner Jonathan Adelstein has requested that the merged entity set aside 25% of its airwaves for minority-run and public service programming, more than three times the 8% the two satellite companies have already agreed to.

But Adelstein may be willing to sign off on the deal with a lower set-aside, as long as it's higher than the current offer and represented as a percent of spectrum rather than a set number of channels, the person said.

High definition, or HD, radio could be a critical factor in this calculation. In his offer, Adelstein joined with several lawmakers in asking that the new satellite radios be equipped to receive HD radio.

Adelstein's HD radio proposal would only apply if the new radios were being subsidized by the merged company through customer rebates or other cost-lowering mechanisms.

Minnesota Democrats and House Energy and Commerce Telecommunication Subcommittee Chairman Edward Markey, D-Mass., have said the satellite radios should be equipped with HD radio in all circumstances.

If at least some satellite radios were able to receive HD radio, that could go a long way toward appeasing lawmakers who are concerned about preserving public service channels.

Adelstein also wants the merged entity to make available the technical specifications of its new radios within 60 days after the merger, as opposed to the one-year time frame they agreed to with FCC Chairman Kevin Martin.

Adelstein's offer also calls for the new company to be monitored by an independent agency to ensure that it is allowing manufacturers easy access to information needed to make their own radios.

If Adelstein signs off, he would be the third commissioner on the five-member body to agree to the merger, which was approved by the Justice Department in March. Martin and Commissioner Robert McDowell have already voted in favor of the merger with certain conditions, including a three-year price freeze for subscribers.

Adelstein and Markey both are asking for a six-year price freeze.

XM and Sirius didn't respond for comment.

Shares of XM were up 16 cents at $8.60 and Sirius was up 14 cents at $2.24 in recent trading.

[oregonduck]

Tate is letting Adelstein be her cover while she looks pretty. What a coward. She will just vote with the guys. What a RINO.

[oregonduck]

See article above--this is a trap! Sirius cant go along with it becuase it will lead to endless litigation and enforcement actions. Also, these "negotiations&quo... will take forever. They have been "negtiating" for months. Look at all of the ex parte communications. What do you think they have been talking about? Adelsteins hair products?! I think that Tate needs to get her ass off the pot!!

[Scot's Slant]

Scotty here with a couple thoughts: A six- year price cap is no big deal. As it was in the past when some T.V cable channels were commercial free, they slowly but surely slipped commercial advertising into their lineup for an added revenue stream -- it's fair to suggest that Sirius/Xm will do the same on some channels with sports, news and talk-radio (Martha, Howard, Oprah), leading that lineup.

Also, as it was in the beginning with free television, free radio will become obsolete where everybody will pay. That's almost a given -- when was the last time anybody gave anything away for nothing?

By the way, there is one more thing: As I said before, Big Mel is still licking his chops from all the free advertising that the media-buzz has generated with the entire merger process -- that guy must be a fisherman as the bait of merger news has hooked world-wide attention for Sirius and XM. And oh, I almost forgot, there's one other teeny tiny thing: Forget price per share -- I'm in it for the long haul and want DIVIDENDS. Come on Mel, oh wise one, give me a clue as to when I can expect my palm to be greased; I've been a faithful and honorable servant for holding onto my shares for as long as I have!

Scot's Slant.

[4play2]

Michael L. You forget a few little things. It cannot be a monopoly if you have the choice not to subscribe at all. No one is forcing people to listen to satrad. Their quality of life will not be jeapordized without satrad. Also, your Federal Government (DOJ) has said, ruled, prescribed and ordained that this merger IS NOT a monopoly. So, who the hell are you to declare differently. Now finally, why in the hell are you on this site?

[olesage]

Bad idea. There's one more Republican on the panel who will most likely go for the merger. Adelstein is grasping at straws here because he knows that soon his vote won't matter at all.
Last ditch effort to appease his lobbyists.
He can tell them he tried til the bitter end.

[SPR]

Adelstein obviously has no understanding of the technology the FCC is charged with overseeing. In view of his head-up-a@@ demand the NAB should be equally required to convert all existing radios to be able to receive sat-rad broadcasts. Come on guys, it's been 18 months, Sirius/XM have offered concessions that are more than generous and the FCC still cannot get of their rears!! And you wonder why Americans are disgusted and disgruntled with how our federal govenment is being run, and I mean legislature, executive and the judiciary, all inclusive!! One other thought, I thought the window closed for input to the FCC months ago, why is Markey only now speaking up, and why are his comments being given any merit?

[Jim42wmass]

Michael L,
Are you serious? How many different brands of bottled waters are there at sporting event? or hot dogs? or ice cream? Usually one. So this happens all the time. You can choose not to buy. Let's take this further. you have one brand of beer at the game that sells for let's say, $5.00 - we'll call that satellite - another brand of beer sells for $0.00 - free, we'll call that terrestrial radio. You think that's an unfair advantage for satellite?

[SPR]

If the FCC were really concerned about leveling the playing field they would get terrestrial broadcasters and the NAB under control and force them to make concessions, and allow satellite radio to merge without any concessions.

[Scot's Slant]

Scotty here. You tell 'em 4play2. No whiners on the XM/Sirius page who oppose a merger. When will the opposing knuckleheads begin to understand that a monopoly cannot exist in a climate where so many other similar products are available for free?

And there is one more thing: All knuckleheads listen up: Saddle up and head on over to Bill O'Reilly's camp -- he thrives on people like the scarecrow on the Wizard of Oz, who sings, "If I only had a brain...."

Scot's Slant.

[SPR]

Why has the US Attorney General's office not yet begun an investigation on terrestrial radio and the NAB for violations of the RICO Act?

[tradeking13]

There should have been a six-year price cap on gasoline when Exxon and Mobil merged.

[Sirius Fan]

Forget Michael L. He already showed himself to be an NAB shill with that POS article he posted a week or so ago.

We closed up .18 today...the finish line is in sight!

[muley101]

None of Adlestein's demands can be accepted. This is just a further attempt to kill sat radio, which he knows would happen if any of this BS were agreed to. The most outrageous demand is the inclusion of HD radio in Sirius' sets. He is asking ((XS)) to build the HD market which is all but nonexistant today, and to do it for free, without getting any of the future income resulting from their advertising. I personally do not even want AM/FM in my radio. Why should I have to pay for HD too? This drives up the cost and shortens the MTF due to more components. The only good thng Adlestein did was to tip his hand so that Tate can now get on with it and vote for the merger without further concessions.

[omagod500]

Are there any minority FCC commissioners? Maybe Adelstein should step down and give his position to Al Sharpton. Thats 20% of their "spectrum".....

(disclaimer: they all might be minority for all I know, just an attempt at some light humor on a friday afternoon)

[cos1000]

omagod500.....Commissi... Tate is a Women.....and she is a minority.

[Roxieanne]

Since I am a minority----a woman----I can't speak for Tate but can give a woman's viewpoint----perspecti...

First, if you read my other posts you will see thIat I consider the demand by Georgetown Partners and now Edelstein as a shakedown by the good ole boys.

They didn't create this state of the art satellite system, but now want to stipulate the conditions under which it can operate and abscond with a portion of the company in the name of public interest and diversity.

This is nonsense.

What is in the public interest? The public interest is getting this merger approved without the conditions being demanded by Edelstein and others..

If Tate is as smart as I believe, she is not going to vote no on the merger that will give us, America, this premier system.

I would encourage Commissioner Tate to approve the merger and let the shakedown artist stew.

[siriusly pissed]

GOD DAMN!!!! This is a PAY SERVICE!!! If the FCC believes that SIRIUS will raise Prices after the Merger, Well, LET IT BE!!! People don't need Satellite Radio to survive and it will be SIRIUS who will go under if people dont subscribe. MONOPOLY My ASS! there's plenty of competition in every media.

[Plowboy]

A woman's place is in the home based on Tate's performance.

Ties to Brownback, Markey, Broadcasters and the NAB while being alienated by things like the Stern program leaves her in her usual "I want everyone to like me" state. Exactly why women don't work in Business or government.

In her own words she's "undecided" after 490 days. Lady, you're not undecided after 18 months, you're simply ball-less

[onesuperguy]

She is undecided after 18 months !

And they say men have commitment issues !!

[163888]

Some of you people amaze me. Why are you so upset with a commissioner who most thought would never approve anyway. For those that know my post, know I am a conservative. So this will not come as a shock, but is most likely true. For most that are upset by what Adelstein wants you must be a democrat or a republican that is showing what morons the democrat commissioners are. The reason is simple most reasonable people (republicans) knew already, that he was a NO vote. The people that are upset are not upset with what Adelstein wants but are upset that they are starting to realize that it is, as I have always said their own party and ideology, that are trying to stop this merger. This Adelstein comment was the last straw, in the proof, and that most needed to see that. I will say I have been a little worried about the future of this country. This should have been a democratic year but between the 20 to 25 million (subscribers/investors... people this merger has pissed off, along with the price of oil that the democrats have caused, due to the fact they have held up almost everytime, drilling for oil in our own country. This just may be a republican year. I am an American first, a republican second, a investor third, then maybe a SIRI/XMSR investor somewhere down the line. So while I would like to have seen the merger have gone through as soon as possible, I am clad it maybe one of the reasons, that many democrats may switch their vote this year.


Just remember democrats if the democrats were in charge at the FCC, you would have had your answer by now, but that answer would have been NO. If republicans would have stayed in control of congress, you would also have had an answer on this a long time ago, that would have been YES. It still will be YES, but would not have taken even as close to as long as it has. You democrats caused this delay you have only yourselves to blame. You put democrats in charge. So remember that the next time you vote. If you still have trouble believeing me take a look at which party most of the state AGs are in, take a look at which party most of the congress/senate are from that have made anti-merger comments/letters, and finally which party the 2 commissioners are from that have ether have not voted or are now asking for things that would kill the merger.

[cos10000]

User 228 your e-mail cascade is an exercise in impotence. Commissioners don't care about the words of "little people" such as yourselves. It's the money, right?