In a somewhat surprising and sudden occurrence, the acquisition of satellite radio's XM by rival Sirius appears much closer to being a sure thing. Senators, members of congress and consumer advocates have, for the most part, been against the merger, saying it would create a monopoly of just one single satellite radio service, and of course they are right; the government slated room in radio frequencies for Sirius and XM and no more. But the chairman of the Federal Communications Commission, a Republican political appointee of George W. Bush, Kevin Martin, said in a statement released this past weekend that "I am recommending that with the voluntary commitments they've offered, on balance, this transaction (XM and Sirius merger) would be in the public interest". (Photo, above and below - Corvette and Corvette Z06 come from its Bowling Green, KY factory with XM satellite radio).
Politicos making pronouncements on weekends normally do so because TV, radio, print and Web news-gatherers are usually "off," and their words will receive less attention than if they held a weekday press conference.
Those "voluntary commitments," which apparently the companies could not be held liable for if they did not 
occur after the merger, include a pledge to make 24 radio channels available for noncommercial and minority programming, and the companies would agree to cap prices, provide interoperable radios (can pick up both sat radio "products") and offer programming on an "a la carte" basis (which, we guarantee, will only make buying, activating and using the systems more confusing ... and generate even more desperate e-mails asking us for help; after someone spends $42,000 on a pick up, for instance, they don't want to be jerked-around for another few hundred bucks they have to pay for a radio system they might not even understand).
Martin's decision could, though, remove the last regulatory hurdle in a lengthy and heavily criticized move to combine the companies. Antitrust authorities at the U.S. Department of Justice approved the merger in March after concluding it would not harm consumers, and you know how much the Bush Justice Department has been concerned with making certain there be no "harm to consumers".
We remember throughout most of 2007, after announcing the wished-for merger of the two sat radio
services, Sirius honcho Mel Karmazin made the rounds of all the talk shows, major, middling and minor. He talked-up the merger, but it seemed every time he (very) publicly promoted the idea, opposition to the proposal seemed stronger and more vocal from political types. So they came up with a better, more insidious plan: Lobbyists!
Interest in traditional commercial and public radio has cooled in the few months since the sat radio merger deal was publicly broached in February of 2007. Both XM and Sirius eventually muted their public marketing push while lobbying regulators, instead, who can approve the deal; which makes sense in the traditional, DC-style of "marketing" ... Paying big-time lobbying firms to "get to" the people who really matter, and that's certainly not we, the people. But as the number of cars with built-in satellite radio has increased (almost all GM cars and trucks come with it, as they use their OnStar service to also receive XM), both services are still adding subscribers, who pay about $13 a month for more than 100 channels of music, news and talk programming. XM ended the first quarter with about 9.3 million subscribers, vs. 8.6 million for Sirius.
And of that total, about half of them, it sometimes seems, have written to this website asking for help in buying satellite radio, activating satellite radio they've already purchased, wondering if their new car or truck is pre-wired for sat radio and whether they can receive XM on their Sirius radio, and vice versa.
Click below for more on satellite radio, the proposed merger between XM and Sirius and another new radio technology, free and already available, something called HD Radio.
As we've written too many times on this site, and as a journalist who was one of the very first to write 
about sat radio technology as long ago as 1986 for Popular Mechanics and other magazines, sat radio is breaking-down in the marketplace when it comes to car salespeople, F&I people and sales managers.
With retail prices between competitive vehicles within tens of dollars of each other (try putting a new Dodge Ram, Ford F-series and Chevy Silverado next to each other, equipped with exactly the same features and you'll see what we mean) and profit margins near non-existent on many new cars and trucks, salespeople and even the Finance and Insurance (F&I) salesmen and women at dealerships know that if they push sat radio, and its costs on buyers, that addition to the bottom line might be enough to void the entire sale and send that buyer to the dealer down the street.
Another major problem is that, as badly-treated as salespeople are at many dealerships, many of them 
feel that even if they do sell a sat radio package to a new-vehicle buyer, their "spiff," or commission, is not enough to have them go through the motions and expend the energy necessary to talk a buyer into spending even more, especially for radio, which they've been getting for free (commercial radio) for the past 80-or-so years. And while both sat systems have made strides in offering "local" news, sports, traffic and weather (all together!), ultimately nothing can replace local radio for those needs.
And in spite of the promises made by XM and Sirius to the FCC, which the FCC seems to have bought as if they were words from "on high," we all know what can happen to such "voluntary commitments" once the deal is made and approved. So everyone should keep a close eye on this one, and be sure to let your congress member and US senator know how you feel about this upcoming merger, which will create a massive, singular monopoly, and might happen, literally and figuratively, very quietly and in the middle of the night. Or on a weekend.
And there's another radio system which is already available to near 85% of the radio-listening public, and it's free, and its quality is every bit as good as that which satellite radio produces.
It's called HD radio, and is a secondary digital signal added to AM and FM radio stations. With this technology, local radio broadcasters can provide listeners with more audio content through FM multicasting, higher quality sound and new data services, while remaining in their traditional places on the radio dial. HD Radio broadcasts are available today to more than 83% of Americans, and it's subscription-free. For all these reasons and more, HD Radio has become an attractive alternative to sat radio, for buyers who at least know about HD Radio's existence.
Comments