Are You Serious?!?!? Sirius and XM Merger

Fred Mills

It may have sent shudders down the backs of music fans who already feel the industry is over-monopolized, but yesterday’s announcement that satellite radio stations XM and Sirius would be joining forces in what market analysts are calling a record $13 billion merger was reason to cheer for others—and we’re not talking about stockholders or investors.

Think about it: You’re pondering the purchase of a satellite radio set-up, and it would be ridiculous to buy two subscriptions. But on the one hand, while you’re way into the idea of, say, Little Steven’s must-hear “Underground Garage,” Marky Ramone’s “Punk Rock Blitzkrieg” and “Outlaw Country” which features segments from Mojo Nixon, Shooter Jennings and Cowboy Jack Clement (all on Sirius—which, oh yeah, also has Howard Stern and Martha Stewart), on the other hand, you’ve also been hankering to listen to Tom Petty’s “Buried Treasure,” Bob Dylan’s “Theme Time Radio Hour” and the members of Rancid’s “Rancid Radio” (all exclusively on XM).

Sob! What’s a poor, music-loving schmuck gonna do! (Well, there’s such a thing as making your own mixtapes… but we digress.) So a one-size-fits-all single subscription sounds like just the ticket.

In theory, then, the XM and Sirius merger would mean that with one sub, you’d get the best of both worlds, and talking heads are already predicting the expensive bidding wars for broadcast talent between the two companies will come to an end, yielding exactly that win-win scenario. Of course, the term “be careful what you wish for,” when applied to the entertainment industry, is always applicable, so only time will tell whether or not the consumer will truly be the winner here. With both XM and Sirius under one roof, and with no challengers to their broadcast-market hegemony, can ever-higher subscription rates be far behind?

All that aside, the point(s) may become moot if federal regulators don’t approve the merger. Currently, laws are in place prohibiting the two to combine, and a statement from the National Association of Broadcasters (NAB) was issued expressing shock if regulators did approve of the merger. Most experts agree that it will depend on how the FCC ultimately views the broadcast industry as a whole: if it’s deemed that the Internet (as well as digital music players such as the iPod) provides a reasonable amount of “competition” to the satellite broadcasters, the approval is likely; but if the prevailing view is that XM and Sirius are each other’s sole competition, then it probably won’t pass.

Both the Washington, DC-based XM and the New York City-based Sirius indicated they are confident that the merger will go through. No word yet on what the company would be called. Xirius, maybe?

Noted the NAB, "When the FCC authorized satellite radio, it specifically found that the public would be served best by two competitive, nationwide systems. Now, with their stock prices at rock bottom and their business model in disarray because of profligate spending practices, they seek a government bailout to avoid competing in the marketplace."

Government bailout? Hey, it’s the American way! Details at 11. Meanwhile, why not support your local NPR affiliate or community radio station with a donation. Tell ‘em HARP sent ya.